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What isn't wrong with this logic? Any scam calling itself a bank that went badly now parallels real life?

There is no parallel whatsoever; the crisis and these scams have no commonality.




Agreed. From the sound of it, this Ginko "bank" was just a poorly disguised Ponzi scheme. This type of scam is already regulated in the real world, for the good reason that it always blows up if allowed.

The article is somewhat interesting but the points it makes are all dangerously, fatally flawed.


Poorly disguised Ponzi scheme... That reminds me of another certain banking system...


Iceland?


I was thinking fractional reserve banking in general, but that is certainly true.


When the cry is "less regulation" at some point you end up with zero regulation. I think looking at eve-online is a great example of zero regulation at work. There are high returns on investment but high risk and the lack of trusted institutions slows the economy.


I asked a few people in Second Life how Ginko worked about a year ago and no one had any idea. Between that and the fact that there is no kind of deposit insurance mechanism, I wasn't going to touch one of those terminals.




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