How To Nip A Ponzi In The Bud

Mirror Mirror on the wall…

Who’s most prone of them all?

As in, most prone to Ponzis…

Frankly, I think it is us gullible Indians.

Everyday, there’s some report of a Ponzi scheme being busted, with thousands already duped.

Charles Ponzi’s is a case of the tip of the iceberg – maximum recognition came posthumously. If Charlie would have received a cut every time his scheme was used by mankind, he would probably have become the richest man in the world. Unfortunately for him, he popped it before reaping the full rewards of his crookedness.

What Charlie did leave behind was a legacy. Yeah, Charlie did an Elvis, meaning that many have tried to emulate Charles Ponzi since he departed. Maybe I’ve gotten the chronology wrong, but you know what I mean…

Chances are, a Ponzi will eventually cross your path sooner or later. More sooner than later.

How do you recognize a Ponzi? Yeah, that’s the first step here – identification.

A Ponzi will talk big – he or she will flash. There will be a small track record to back up what is being said, and this will almost be blown into your face, after you’ve been dazzled by the Ponzi’s fancy car, expensive clothes and gold pen. The Ponzi will be a good orator, and his words will have a hypnotic effect on you (ward this off with full strength). The Ponzi will show off, making you feel awkward. You will feel like being “as successful” as what is being projected before you, right there, right then. When all these symptoms match, and such feelings well up inside of you, you are, with very high probability, talking to a Ponzi, who is trying to suck you in with a promise of stupendously high returns.

After you have identified the Ponzi, the next step is to not get sucked in. This is going to take all your self-control. Remember, the grass is not greener elsewhere. Take charge of your emotions. You’ve identified a Ponzi, man, that’s big. Now you need to follow through and see to it that a minimum number of people come to harm.

Hear the Ponzi out. Don’t react. In fact, don’t say a word. Don‚Äôt commit a penny. Keep reminding yourself, that you have it in you to succeed. You don’t need the Ponzi’s help to get good returns on your money. You certainly don’t want to lose all your money. With that thought in mind, block the Ponzi and his promises out. Leave politely and inconspicuously.

After you’ve left securely, without having committed a penny and without having left your details with the Ponzi, you now need to sound the alarm. Tell all your friends of the lurking danger. Forewarn them, so that no one you know gets sucked in. Ask everyone to spread the word. The whole town needs to know within no time.

Identify – Control – Alarm – this is a three step programme to nip the Ponzi In the bud – try it out, it works!

Cheers! ūüôā


What U Gonna Do When They Come For U?

“Bad Boys Bad Boys, what u gonna do…

what u gonna do…

… when they come for you?”

Lots of bad boys floating around.

They make a beeline for an underlying, for example Gold. Hike up its price. Entice you to enter at a peak. They cash out. You, the slow poke, are left high and dry.

Then the bad boys gang up and short the underlying simultaneously. Price tanks. From one day to the next, you are sitting on a large loss. You get out, disgusted.

Don’t make yourself vulnerable to such bad boys. Get your strategy right.

Buy at strategic points. If you are buying at dips, do so at pinpointed levels, like Fibonacci ones. You can also buy when a resistance is broken. Or, you can buy when a high is taken out with volume. Don’t buy above that. Meaning to say, that’s the vulnerability cut off. After that, you expose yourself to the bad boys, because you don’t have any margin of safety after that point. Through your actions, you activate bad boy zone.

On the short side, go short at strategic points in a rally. That’s where margin of safety is maximum. You can also short when a support is broken. Or, you may go short when a low is taken out with volume. Below that is bad boy zone.

At times, the human being likes the thrill of being in bad boy zone. Got me there, I like it too. Only sometimes. In bad boy territory, you need to be light. Don’t carry too much cash in your pockets when they come for you. In bad boy territory, do options. Options are your best friends here.

The advantage of operating in bad boy territory is that every now and then, there’s a jackpot for the taking. There’s no telling how far bad boys take an underlying in a particular direction. Where there’s risk, there’s reward. Out of ten option trades you put on, at least two or three should hit the pot if your research is good. That’s all you need.

In bad boy territory, the only position you want to be in is about showing the jackpot in the one hand and the finger from the other. By default, your losses must be small here, and they are, because you are doing options. Period. With that, you’ve shown the necessary aggression that is required in this territory, and you’ve also shown proper backfoot (defence) strategy. That is winning behaviour in bad boy territory. That’s the language understood by bad boys, telling them to lay off. Now, even if they try to come for you, they’ll not get you. Ever.