Are You Playing The Ponzi Scheme? The History Of The Biggest Ponzi Scheme In History, LFG Daily - November 11, 2025

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The History Of The Biggest Ponzi Scheme In History, The Government

If you think the market is rigged, you’re right — but not the way you think.

We’re living in the biggest Ponzi scheme in human history. Not a scam run by Madoff, Enron, or some shady crypto exchange — but one built into the foundation of our monetary system itself. It’s a game of inflation, credit, and control — designed for asset prices to rise and the rich to get richer.

The Long War Over Money

America’s story has always been a fight over who controls the money — the people, or the powerful.

• 1791: The First Bank of the United States was created after fierce debate. Alexander Hamilton saw it as essential for a young nation’s credit; Thomas Jefferson warned it would enrich elites at the expense of ordinary citizens.

• 1816: The Second Bank of the United States replaced it — and once again became a tool for political and financial insiders. President Andrew Jackson saw through it. He called it “a den of vipers and thieves” and shut it down in 1836, vowing to return power to the people.

But the bankers never stay gone for long.

• 1913: On a quiet December night, Congress passed the Federal Reserve Act, creating a central bank controlled by unelected officials and deeply tied to Wall Street. It was sold as a stabilizer — but what it really created was a mechanism to inflate, bail out, and manipulate.

From that moment, America’s financial destiny shifted from Main Street to the Fed’s balance sheet.

1971: The Turning Point

Fast forward to 1971. President Richard Nixon ended the convertibility of the U.S. dollar to gold — the final link between our money and real value. From that point forward, the dollar became pure fiat — a currency backed only by faith and debt.

That’s when the Ponzi really began.

Without gold limiting spending, the government could print, borrow, and promise endlessly. Each time the system cracked — from the dot-com bubble, to the Great Financial Crisis, to COVID — the solution was the same: print more money and bail everyone out.

The Game Plan: Inflate, Bail Out, Repeat

Since 1971, every economic crisis has played out on a loop:

1. The system gets overleveraged.

2. Asset prices crash.

3. The Fed floods the market with liquidity.

4. Asset prices inflate again — but the rich own the assets.

   
   

Sound familiar? That’s not capitalism — it’s monetary manipulation. The government and Fed reward debt, speculation, and financial engineering — not productivity, innovation, or savings.

It’s why the wealth gap keeps widening. The rich own stocks, real estate, and businesses — all things that inflate with every bailout. The middle class owns wages and cash — both of which lose value with every dollar printed.

How the Modern Ponzi Works

Let’s break down the mechanics:

• The U.S. government spends more than it earns through taxes.

• To cover the gap, it issues Treasury bonds — IOUs backed by future taxes.

• The Federal Reserve buys those bonds, creating money out of thin air.

• That money flows into the banking system, inflating financial assets and debt-driven growth.

It’s a self-reinforcing cycle — new money props up old promises. And like any Ponzi, it only works as long as confidence remains.

The Illusion of Prosperity

Since leaving the gold standard, the U.S. dollar has lost over 85% of its purchasing power. But the stock market? Up thousands of percent. Home prices? Skyrocketing.

We call that “growth,” but it’s really inflation disguised as wealth.

The average American feels richer in dollar terms but poorer in reality — working more hours for less purchasing power while the cost of living climbs. The illusion of prosperity hides the truth: our system requires constant inflation to survive.

How to Protect Yourself in a Rigged Game

You can’t control the system, but you can learn how to navigate it.

1. Own Assets, Don’t Just Earn Income.The system rewards ownership — stocks, real estate, and productive businesses.

2. Hedge with Real Value.Gold, commodities, and other finite assets serve as insurance against currency debasement.

3. Reduce Dependency.Live below your means, avoid excessive debt, and maintain flexibility for when the system cracks again.

   
   

The Bottom Line

The biggest Ponzi scheme in history isn’t hidden — it’s printed on every dollar bill.

The Federal Reserve inflates it. Congress funds it. And the political class depends on it.

But you don’t have to. The rules of the game are clear: The system makes asset prices go up, so you must own assets.

Because the moment you stop playing defense and start thinking like an owner — you stop being a victim of the system, and start using it to your advantage.

Don’t leave your financial future up to chance. Let’s build a plan that gives you confidence today and peace of mind for tomorrow. Click here to schedule a meeting — I’m here to help you take the next step toward financial freedom.

Colin Symons, CIO Lloyd Financial Group

The Senate advanced a government funding bill, causing stock market happiness. The final bill includes yearlong funding for several agencies. The hope is the House can vote on it on today or Wednesday and send it on to Trump.

Switzerland is nearing a deal to cut tariffs from 39% to 15%.

Japan’s Economy Minister says they aim to get wage growth exceeding inflation.

Japanese 30Y bonds got hit after drawing weak demand, as concerns mount over government spending plans.

Softbank sold their remaining $5.8B NVDA stake in October to help bankroll AI investments. Seems to me they’ve had consistently poor timing on sales but the news seems to be driving NVDA down a bit, this morning.

CRWV, a data center darling, cut guidance after delaying a customer project and was down -9%.

ISM Services and ADP Employment, today.

Downside isn’t much fun, but that’s the price you pay for equity returns. After long periods of low volatility, that price can be forgotten. That’s why, if you want to survive over the long-haul, it’s good to have a plan and a system for dealing with the ups and downs of the market. Of course, having a plan doesn’t make you invulnerable. It just forces you to decide ahead of time what you’ll do when something happens.

For instance, in early October, I said that if you were nervous about your holdings, that was a good time to trim or sell. The basic reason was that we were heading into risk events, and you could start to see the market buy protection. At the time, there wasn’t anything fundamentally wrong, but positioning risk was there.

I view positioning risk, in isolation, as short-term in nature. Thus, if you were worried about holdings and weren’t willing to hold on through potential volatility, you should’ve trimmed or sold. As it turns out, we got that positioning-based risk selling. In fact, it was worse than expected, as the mix of low liquidity from a longer-lasting shutdown turned out to be a toxic mix with AI disappointment.

That AI concern, by the way, is why I’ve been telling people that I reduced my AI exposure. The expectations were so high that I was worried they could sell off. Now that a selloff happened, owning AI-based stocks isn’t quite so concerning.

Over the weekend, Congress made good progress on reopening the government, so chances are that the early move towards fundamental risk, in the form of rate stress, is largely over. If that wasn’t the case, our plan would have prevented us from adding risk and if it got worse, we may even have had to reduce risk.

As it happens, with the move towards reopening, chances are that we’re going to expand our risky positions in short order, moving from low-duration, high cashflow names to the opposite, which is a somewhat fancy way of largely saying we’ll take a bit of a move away from value and towards growth.

Whatever happened, though, there was a plan. In this case, I think things worked out pretty well for us. With big positioning risk and little fundamental stress, we should be able to use the opportunity to improve the portfolio. As the positioning stress happened, we got some stress in the portfolio, but nothing particularly out of the expected range.

I do want to emphasize it didn’t have to happen that way. The nearer-term signals like volatility and moving averages are there for a reason. If there were a longer-lasting problem, usually those break first. If you are a shorter-term trader involved in shorter-term positions, early October was still the time to sell. I’d claim now is around the time you’d want to be buying new positions.

What if this did turn into a bigger problem? What if the market kept going down and fundamental problems started to assert? Then the early-warning positioning risk would have been the best time to sell. That can definitely happen and is a reason to be aware of them, whatever your style.

My basic point is that real life is messy. It seems to me like this round will work out well for us, but it didn’t have to. It was entirely possible that we’d have had to sell after positions had already gone down 10% or more. Markets and life are random, and you never know just what will happen.

However, having a solid system can swing the odds in your favor. That’s the point of having a system, really. What do you want to react to and how strongly do you want to react to it? There’s no right answer, really, and different systems can work well for different people with different risk tolerances.

For my part, I prefer to have longer-term positions based on macro and fundamental conditions. If those positions are hard to find or unclear, it doesn’t bother me to have shorter-term positions, if they’re better than holding cash. And sometimes cash is the best position available. The point is, my system works for me, and I’ve spent a lot of time and energy developing it and getting comfortable with it. Hopefully, however your money is invested, it’s also from a source of a well-developed, thoughtful system.

Don’t leave your financial future up to chance. Let’s build a plan that gives you confidence today and peace of mind for tomorrow. Click here to schedule a meeting — I’m here to help you take the next step toward financial freedom.

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