They all sound the same to me!
In: Other
Ponzi schemes, I believe, are specifically for investments. So new investors pay to get in to the investment, and you take this money to pay people who were already invested. So it looks like the investment is paying off, and have a solid return, but it’s not from the stocks performing well just form new people buying. And people think it’s returning well so they are more likely to more money in, and you give this to other investors. But if enough people pull their money out, or you can’t get enough investors, it all comes crumbling down.
MLMs and Pyramid Schemes I think are the same thing, just different names. Pyramid schemes have a negative connotation, so they rebranded them as MLMs. A “supplier” gets desperate people to sign a contract to pay back product. So if they manage to sell the product, both get paid. But if they don’t the supplier can seek reimbursement legally. They rope people in with “be your own boss” or “set your own hours” or “you can earn up to $100,000 a year”.
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