Yep. It's amazing how many people don't know that.
Ponzi scheme (pòn´zê) noun
An investment swindle in which high profits are promised from fictitious sources and early investors are paid off with funds raised from later ones.
[After Charles Ponzi (1882?-1949), Italian-born speculator who organized such a scheme (1919-1920).]
The American Heritage® Dictionary of the English Language, Third Edition copyright © 1992 by Houghton Mifflin Company. Electronic version licensed from InfoSoft International, Inc. All rights reserved.
1. How does this differ from pyramid schemes in marketing?
2. Where is the money from Social Security?