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These seven reasons show why you should stand by your decision to not engage in Ponzi schemes
Promise of big money consistently with little work:
Entrepreneurs know that there are of course things that you can do to make money without having to work all that hard. But, it’s just not possible for everyone who joins a business to be able to make so much return without working. Making money takes work. Entrepreneurs also know that NO business on earth can consistently provide such returns. Businesses have ups and downs simple.
The Principle of value:
Real entrepreneurs understand that real wealth is generated from the creation of value and not from instantaneous windfalls resulting from concocted trade-offs. They understand the paradox of the lottery winner…money minus value does not equal wealth.
Understanding Money:
Real entrepreneurs understand that money is really not valuable in itself. It is valuable because people agree to make it a medium of exchange for REAL value. Its utility lies in its use as current (hence currency) for the movement of value thereby obviating the need for barter. A system running merely on the exchange of money for profit is nothing but a SCAM. Participating in such a system like that only lends credence to the scam.
Not an investment:
I have heard people liken the Ponzi system to investing in shares. The comparison is laughable. When an investor buys shares, he is taking real risks to contribute into an entity that undertakes in the creation of some sort of value. Investing in shares takes careful thought, analysis, and assessment. He does not expect consistent returns. By buying shares, the investor expresses faith in the vision of the company and faith in the management to execute the vision. It takes knowledge to avoid serious burns. So NO; Ponzi schemes are not comparable to investing in shares.
The issue of focus:
Entrepreneurs are busy trying to create and perfect systems, solve problems, devise innovative answers to challenges. They are bound to look at a get rich quick scheme as a mere distraction in terms of the time and resources to be expended into chasing a venture that provides no ultimate value addition to themselves or the society.
The moral question:
If you are sure that a system is a scam propped up by the resources of naïve but trusting participants being manipulated by experienced “confidence men” with an uncanny understanding of human greed and a history of taking advantage of it, would you still support it with your money?
The understanding of risk:
Proponents of the scheme tout the cliché; “Nothing ventured, nothing gained” because it paints the contrarian picture of a daring risk taker. Entrepreneurs however understand the difference between gambling and enlightened risk taking. A gamble is taken without the understanding or control of the variables which determine the desired outcome. Investing involves enlightened risk taking premised on an understanding of key variables and a reasonable grasp of possible eventualities. If I commit to give my money to a scheme over which I have no control, because of returns of which I have no sight, I am not investing, I am gambling.
The times are hard. Nigerians are seeing Ponzi schemes as some sort of savior from the harsh realities of the current recession despite the obvious signs that it is not. To all those who cannot resist the temptation of quick easy cash, please proceed with extreme caution. To all those who do not participate in the scheme as a matter of principle, know that you are not alone.
Very nicely said!