Ginko Has Not Allowed Withdraws For Over A Day Now...

I wonder how offering an 85% loss on people's money is benefiting you...

oh yeah dont go anywhere near the ginko main bank unless you like getting spammed with other banks notecards i put like 5 people on mute ..

I'm done with this forum.

I guess you scared him off with math, rocketman

We can only estimate, but I can do a rough breakdown on the last six months b/c I have been tracking numbers that long. From Feb to the end of July, "total deposits" increased about 60m. About 33m of that was pretend interest (4m in Feb and March, 5m in April, 6m in May, and about 7m in June and July). These are rough numbers, but ballpark-accurate. You can figure this out b/c they were paying 250k a day at the end on 192m in deposits, and work it backward, taking into account the interest rate changes.

So that leaves about 27m. How much did they take in cash during this time? Portocarrero said US 1-2k per month for him and US 1-2k per month for the employees. We can say US 3k average, but I bet it was more, b/c people tend to underestimate their own bad acts.

But at US $3k a month average, that's around $18,000 pulled out since February by their admission, or a little under 5m Linden. That means that of the 60m in increase that we saw, only about 22m was real, new money coming in that was available for "investments" -- which thus had to perform way, way better than even 60% a year, since that's what they were telling people they'd pay *after* taking their cut. That's probably not the worst of it; if I was a betting man, I'd bet they took a lot more than 3k per month.

Oh, do tell us, Nicholas. What exactly is a Ponzi scheme?

Mr. P. won't be replying. After three days of insightful and candid responses designed to instill confidence in prospective investors, he has left the forum to tend to some other pressing business. And perhaps to pack a suitcase and see how the fake mustache and forged passport are coming along...

and when you do realise that their have been real estate scams that were described as Ponzi.

Sorry he said he was done with these forums

Then he's chicken. Are you chicken, Nicky? Tell me what a ponzi scheme is. I just made popcorn.

You might notice on Ginko website that the total balance of saving accounts is regularly decreasing (abt 1.5 million today), corresponding to the "queued" withdrawals, when the total balance of term deposits is NOT increasing. So, unless you think the numbers on that page are totally fake, there MUST be some asset selling in some way. Payments to old investors are not made with the money taken from new ones. If total liabilities are decreasing, total assets have to do the same, or did I miss anything?

Nicely said.

Unless the Que withdrawls count even before they are actually paid off.

And those who buy the Bonds at 100$L would reduce the balance.

I would think that new accounts are partially covering the withdrawals. What that percentage is anyone's guess. For the life of me I can't comprehend anyone putting new money in...

Perhaps all the "outside" investments is a money market account with all the money in it and he is leaking a little money back at a time in hopes of quelling the run. As he takes his "salary" every month, it would be to his great benefit to keep this thing going for as long as possible. I'm sure there is a number in his head where he will say "screw it, time to cut and run" and bye bye Ginko. And bye bye to everyone's money.

It is hard to tell exactly how that number on the top of the website is calculated.

The decrease could be the sale of his junk bonds. Some folks might be gullible enough to buy them in some overly optimistic hope that they will actually see some of their money.. maybe.. someday.. over the rainbow... oh, sorry, got carried away by the high finance fairies for a moment.

Anyway, When someone converts some or all of their balance into those junk bonds, the money goes out of their accounts, since the bonds are not being held by Ginko, but are Avix instruments. Thus, the reduction in that statistic. Of course, he could also be deleting accounts of folks who are so irate that he's doing it out of spite or something. Who knows?

He may also be finding some little bit of money here and there to throw at it, but it is like trying to put out a bonfire by peeing on it.

Its not Monday morning yet he has time before the passport is ready lots more time to loiter on forums

for thoes who dont know, the original pozni scam that created the term involved a real object, a International reply coupon (bascialy a way to buy postage stamps in another country, that could then be resold for a profit based on the diference in value in the exchange rate) that had real value. Ironicaly (or perhaps not) Ponzi aparently never had more than a handfull of them, and worse, at the peak of his fraud the only posible way his scheem could have worked was if their literaly hundreds of thousands of thoes coupons to be in exhange at a level wich would have resulted in a literal flood of stamps being sold by his "buisness" to the point that theoreticaly Ponzies buisness should have been the only posible way to get stamps!

his defence is that hes not engaged in a classic ponzi however in comon useage a ponzi sceem is anything that seems to take a reall profit potential as its base mechanism for turning a profit, but the real funding mechanism of said profits is little more than taking new money to not only cover withdrawals but as the actual profit. Part of Enrons downfall was they bascialy too the whole sale price of an asset and clamed that as profit for example.

Bascialy from a pure accounting point of view you can legaly convert capital for capital. the easyest way to do this is via stocks and bonds. Its actualy a lot more complicated (legaly) to convert interest in deposit type accounts

In fact theirs Specific laws on the books that deal with interest payments on investments and deposits. bascialy what it boils down to is you cant reinvest interest payed into an account untill certain conditions are met. (which is why when you look into it you tend to see some fairly hard divisions in financial insitutions between the branches that handle bond type investments Vs the ones that handle deposit type investments.)

What you can NEVER do is convert an investment to profit. that is the basis of any and all ponzie sceems. Unfortunatly with Withdrawls caped to 5k and still promising high rates of return what he was defacto doing was useing incomeing funds to pay off his obligations, includeing interest payments.

I have made the point that his abrupt droping of the interest rate of his "Checking" deposits to a fraction was a good first move. In reality its not unusual for banks in trouble to suspend interest on saveings and checking. Its also not unusual for banks to borrow short term to finance a temporary shortage in their required minimum cash holdings, but thoes are subject to some fairly extreem rules reguarding accountability, (for example depending on the country and type of account you have to keep interest earned seperatly and not reinvested for as mutch as a year(even with accounts that "compound daily"(think about it for a second, when on a car credit card or house loan have you ever had to make daily payments?)

There is always the possibility its a Ponzi scheme through ignorance rather than intent.

It wouldnt surprize me from the way things seem.

Though the paying himself and his boddies salaries in the thousands of USD monthly really makes that a shaky theory - since he was not showing any profit anyone knows about, the money most likely came directly from Deposits.

a Pyramid (and some multi level marketing frauds) all rely on one person being the recipient, and funds being payed "uphill" from older investers to newer investers, thies tend to fall apart a bit faster than a classic ponzi in that its harder to fool people as to whats going on, most participats know from the start that they are in a scam in that its obvious that theirs a finite number of people who can come into the base. A Ponzi scheme on the other hand needs as its basis what either is (in the case of Enron and their asset churning, or in the case of "High risk loan" real estate fraud where you sell a 300k morage on a property with a real value of 150k, pocket 50k, and bank 100k for paying off the loan to make it look like your getting the propertys payed off in a timely manor) Bascialy what quicly happens is that between the actual payments made by the property buyer (who thinks they have a 150k morage) payments drawn from money set aside, and new morgages taken under simular fraudulent circumstances, (only in second life the "real estate" is literaly as fictional as Ponzis International reply coupons, they only exist as bits of data that can be deleted any time LL decides to pull the plug on everything)

..which was actually worth a fraction of a cent each, even in 1920 dollars.

However, his postal reply coupon investment contracts paid out 50% interest in 45 days, or 100% in 90 days, and were renewable.

Actually, you have that a bit reversed. Ponzi schemes all rely on one person (or one group) being the recipient and organizer(s) of the scheme; pyramids rely on exponentially-increasing waves of people who pay a fixed number of tiers above them in the pyramid.

I tend to feel he got in over his head, or somewhere allong the way he realised that most of his profit was comeing from taking in more money from other players than he was actualy paying out.

Unfortunatly his behavior seems to be way to defensive for someone who has had that happen.

Given how long he was in the game I feel what realy happend is he got lucky that the game continued to expand around him faster than people needed to take funds out. but somewhere along the way he had to know what was realy going on, and that he had to keep money in the bank and in order to do that he had to somehow show that his was the more profitable investment.

For example he probably realised somewhere along the way that he had some deposits from people who had cancled accounts long ago and knew that thoes were safe to keep on the books because thoes at least would never be taken back, and he could put any ammount of pretend interest on thoes because it was realy part of current customers base.

Yeah this is kind of what I mean by Ponzi through Ignorance

With the added idea that he still hasnt realized it yet - and instead thinks the potential of his investments will come to fruition and will pull him out of the mountain of debt he has.

Remember his statement "the investments have already been made, there is no need to reinvest" ..

sorry ment to be a bit clearer on that, ment for that to say " one person as the ultimate recipient" but bascialy theirs no real investment, just income seeming to flow uphill from an ever growing base without the participants never realy putting any new money in apart from their initial investment, some of the Multi level marketing frauds tend to involve the idea that you can infinitly expand a buisness under you and keep spliting the proceeds between you and the person above you.(in reality you eventualy end up with too many people trying to sell the same Items in a given market and while that benifits the suplier of the Item in that the efforts of the people who try to sell the crap will tend to sell a market to its maximum saturation faster, the problem is that offten when you max out saturation in demand for an item that tends to cause the individual retailers to implode)

From the Ginko Forums (and man is that a sad place -- about one in ten gets it now, and says something, and is roundly beaten by everyone else for "making the problem".

Anyway, this question gets some light shed on it in the third paragraph.

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Posted: Sat Aug 04, 2007 11:18 am

Post subject: Stern Warning for All Potential Investors

As my latest comments on the “lost” transactions from this new withdrawl system, I’ll post this to see how long it takes for the people at Ginko to remove it.

Ginko Financial was set up as a bank, and institution designed to store money and invest that money to return a dividend to it’s investors. As the reserves of Ginko have been depleted, for what ever reason, they are now telling us that our money will be returned to us after more money is deposited. Well let’s see, that doesn’t mean that someone at Ginko is going to deposit it, it means that people who are unsuspecting of what’s going on are expected to deposit money into an institution that’s bankrupt. Once someone deposits their hard earned lindens into their account, someone in the “CUE” will automatically get that persons money. Money that’ll never be invested as the “bank” owes money to other people who have done the same thing.

Now the latest trick, con, swindle or what ever you want to call it. Let’s say your number comes up in the “cue”, you account balance is lowered by that amount but guess what, NO MONEY IS SENT TO THE AVATAR!! This makes the transactions history for the institution look like something is still working within, yet all it does it prove that the institution is truely stealing our lindens for whatever reason.

If you want to restore confidence, which I highly doubt you really care as you’ve lost nothing, is to use YOUR lindens to pay people what they are trying to withdraw. I highly doubt that this will occur as it’s been explained, “Is only a game”.

Well I have to say, you’ve played the game well and screwed hundreds of people out of their lindens. You should feel confident that you’ve added one more nail in the coffin of Second Life. With them adding more and more restrictions to the “game” I believe the end is near for the whole virtual experience know as “Second Life”

But rest assured that the owners of Ginko and all other “banks” won’t lose any of their real life money as they’ve already gotten theirs out of the institution.

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