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High interest rate clubs
published: Wednesday | February 7, 2007 <DIV class=KonaBody PgAjQ="true">
Delroy Chuck
The current rage is to earn huge fortunes around town. High interest rate clubs have emerged, giving an average of 10 per cent per month, and sometimes as much as 18 per cent. Are you not an active member? </DIV>
Many of my friends and colleagues boast of their monthly income and wonder how I am not investing. Well, fools rush in where angels fear to tread. Blind faith and vain hope are the usual downfall of reckless investors and perennial gamblers.
Only time will tell if these high interest rate clubs are sustainable. One colleague informs that he has $10 million dollars invested and collects $1 million per month. Another informs that he leaves his money to turn over and every eight months the money doubles, which is correct, as a million dollars becomes $2 million when compounded over eight months.
Others boast of collecting enough interest equivalent to their original investment and leaving the principal to earn even more, as money just keeps rolling in. At some of these high interest rate outlets, the operators do not have enough hands to collect from clients who are investing every dollar they can garner to increase their fortune.
Well, I do not grudge anyone. Neither do I intend to stop people from believing what they want to believe. Actually, I cannot stop anyone from putting their money where they hope to earn huge returns. However, I am a cautious man, and if anything is too good to be true, it is probably not true. I doubt if what I consider to be high interest rate gambling clubs can continue indefinitely. At some time, they must crash - the only question is when. But while the going is good, as some argue, why not take advantage and earn well.
Balance sheets
Have any of these 'investors' ever asked for the balance sheets or the audited accounts of these operators? In fact, do any exist? For me, if there are no balance sheets or audited accounts, the operations are mere shams, con games, inducing the innocent, greedy and reckless to gamble their money in what are generally known as Ponzi schemes, in which, eventually, there are few winners and many losers.
Gambling operations do not produce goods and provide very little new service, which means no new wealth is created. Gambling gives thrills and temporary hope to many while providing fortunes to a few. It allows money to circulate faster than any other activity but in the end, there is no new money. If there are winners, there must be many losers. Moreover, it is just impossible to win every time. Thus, if one gambles on foreign exchange operations, there must be times when one loses. If every time, the foreign exchange operator wins, then somewhere, somehow, others are always losing and, logically and prudently, why should they continue? Of course, it is possible to earn 10 per cent per month for a few months but it is impossible to do so continuously.
Interestingly, if these high interest rate gambling clubs can provide 10 per cent average per month, how much are they earning for themselves? If they give 10 per cent per month, they must be earning at least 12 per cent to pay staff and meet overheads. I can think of no legitimate operations in which these returns are possible.
In fact, if these operators have found a pot of gold from which they can earn such huge returns, why share it with so many others? In essence, if an investment strategy has been developed to earn huge profits steadily, I rather doubt the strategist would share the strategy or the benefits with all and sundry.
Yet, at the end of th
published: Wednesday | February 7, 2007 <DIV class=KonaBody PgAjQ="true">
Delroy Chuck
The current rage is to earn huge fortunes around town. High interest rate clubs have emerged, giving an average of 10 per cent per month, and sometimes as much as 18 per cent. Are you not an active member? </DIV>
Many of my friends and colleagues boast of their monthly income and wonder how I am not investing. Well, fools rush in where angels fear to tread. Blind faith and vain hope are the usual downfall of reckless investors and perennial gamblers.
Only time will tell if these high interest rate clubs are sustainable. One colleague informs that he has $10 million dollars invested and collects $1 million per month. Another informs that he leaves his money to turn over and every eight months the money doubles, which is correct, as a million dollars becomes $2 million when compounded over eight months.
Others boast of collecting enough interest equivalent to their original investment and leaving the principal to earn even more, as money just keeps rolling in. At some of these high interest rate outlets, the operators do not have enough hands to collect from clients who are investing every dollar they can garner to increase their fortune.
Well, I do not grudge anyone. Neither do I intend to stop people from believing what they want to believe. Actually, I cannot stop anyone from putting their money where they hope to earn huge returns. However, I am a cautious man, and if anything is too good to be true, it is probably not true. I doubt if what I consider to be high interest rate gambling clubs can continue indefinitely. At some time, they must crash - the only question is when. But while the going is good, as some argue, why not take advantage and earn well.
Balance sheets
Have any of these 'investors' ever asked for the balance sheets or the audited accounts of these operators? In fact, do any exist? For me, if there are no balance sheets or audited accounts, the operations are mere shams, con games, inducing the innocent, greedy and reckless to gamble their money in what are generally known as Ponzi schemes, in which, eventually, there are few winners and many losers.
Gambling operations do not produce goods and provide very little new service, which means no new wealth is created. Gambling gives thrills and temporary hope to many while providing fortunes to a few. It allows money to circulate faster than any other activity but in the end, there is no new money. If there are winners, there must be many losers. Moreover, it is just impossible to win every time. Thus, if one gambles on foreign exchange operations, there must be times when one loses. If every time, the foreign exchange operator wins, then somewhere, somehow, others are always losing and, logically and prudently, why should they continue? Of course, it is possible to earn 10 per cent per month for a few months but it is impossible to do so continuously.
Interestingly, if these high interest rate gambling clubs can provide 10 per cent average per month, how much are they earning for themselves? If they give 10 per cent per month, they must be earning at least 12 per cent to pay staff and meet overheads. I can think of no legitimate operations in which these returns are possible.
In fact, if these operators have found a pot of gold from which they can earn such huge returns, why share it with so many others? In essence, if an investment strategy has been developed to earn huge profits steadily, I rather doubt the strategist would share the strategy or the benefits with all and sundry.
Yet, at the end of th
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