The Ponzi Factor – The Simple Truth About Investment Profits

The Simple Truth

$34 trillion of stock value = $0 in real money

Investors want money, not value.

The Ponzi Factor is the most comprehensive research ever compiled on the negative-sum nature of capital gains (non-dividend stocks). The book is not a perspective or an opinion. It is a proof that is based on definition, logic, and it is supported by observable facts and history.

The simple truth is profits from buying and selling stocks come from other investors who are buying and selling stocks. When someone buys low and sells high, another sucker is also buying high and needs to sell for even higher. Companies like Google, Amazon, and Tesla never pay their shareholders. Their investors profits are dependent on the inflow of money from new investors, which by definition, is how a Ponzi scheme works.

About the Book

Fundamental ideas are easy to understand and influence many beliefs.

The legitimacy of the stock market rests on two fundamental assumptions. One is the idea that stocks are “equity” instruments that represent ownership. The other is the perception that stocks are “positive-sum” investment instruments, and investors win more than they lose. However, these assumptions have never been properly investigated, and it can be shown that neither are true.

The Ponzi Factor does not criticize the investment system. It proves why the features of the current stock market system meet the definition of a Ponzi scheme, and explains why even in the absence of insider trading, high-frequency trading, and highly improbable market crashes; the stock market is simply not designed for investors to prosper.

A stock without dividends is a Ponzi asset. It’s not how ownership instruments were designed to work historically or logically. This is not another story that will disappear after another market crash, it is an idea that will remain relevant for as long as the stock market exists.

What’s Inside

About the Author

Tan Liu was born in Beijing, China. He moved to the U.S. when he was six and was raised outside Washington D.C. Unlike his sister who finished high school and got a scholarship to MIT, Tan took a less traditional path and went straight into the working world. He was employed as a bike courier after high school and later supported himself through college as a freelance photojournalist for networks such as CNN, MSNBC, and Fox. In addition to his professional life, Tan also spent many years volunteering as a youth mentor in D.C. and Inglewood, California.

In 2006, he completed his undergraduate degrees in economics and finance from the American University. He has worked for two hedge funds and a trading firm in Shanghai, but spent most of his career managing distressed assets for a bank. He officially exited the finance industry in 2015 and is now finishing a master’s degree in applied statistics.

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The Ponzi Factor

6 days ago

I'm going to share what I've been telling people close to me. I think the coronavirus situation is going to get worse before it gets better and it would be wise to make some preparations until there are signs of improvement. This means:

1) Get some extra toilet paper and essentials. (Please don't panic buy and cause a shortage for others.)

2) I believe there will be a crash within two months. This is not an indefinite black swan call. It's a foreseeable event that will reveal itself (or not) within two months, not later this year or next year, but two months. Therefore, I told my family and friends to liquidate whatever investments they might have (if possible) and hold out for two months.

This what I've done. This is what I've told my friends and family. I consider you all family too. ... See MoreSee Less

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The Ponzi Factor

2 weeks ago

💪🏻 Off topic...People in #Wuhan shouting from their apartments saying “Wuhan add oil,” a Chinese phrase of encouragement like, Wuhan be strong 💪🏻 ❤️ #staystrong #coronavirus #china ... See MoreSee Less

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The Ponzi Factor

2 weeks ago

📚 Over the past year, I started suspecting something that I can now conclude: The SEC is knowingly supporting what they understand are active Ponzi schemes. The SEC are dirty cops who actively support Ponzi schemes.

SEC Office of Investor Education and Advocacycebook.com/2168510806535474">#ponziasset #SEC #stocks SEC Office of Investor Education and Advocacy #TSLA ... See MoreSee Less

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The Ponzi Factor

2 weeks ago

📚 A friend asked me if the ascension of TSLA hurts my thesis. I said, "Of course not. My research is a proof that shows there’s no monetary connection between Tesla and the shareholders. The price doesn't affect the proof, it only affects the visibility of the proof."

Ponzi schemes show themselves when they crash, but also when the price ascends completely out of control! ... See MoreSee Less

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The Ponzi Factor

3 weeks ago

Google has two kinds of #Ponziassets:
GOOG: NO voting rights
GOOGL: HAS voting rights.
Sometimes GOOG cost more than GOOGL because investors will pay more for a Ponzi asset without voting rights. 😂
Why?
Ponzi assets my friends..Ponzi assets.. #stocks ... See MoreSee Less

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