The Post Newspapers Zambia
By Rev Walter Mwambazi on Sunday 13 March 2011, 04:00:00 CAT (2650 Reads)
Allow me to digress a little today and address what I think is one of the greatest strategies used to keep the poor poverty stricken. The method is simple, use the age old trick of getting people to reap where they have not sown!
How? By promising that they will make lots of money for doing virtually nothing! (That is why lotteries are popular!)
If it is too good to be true, then it probably is!
There are many cons today that are floating around purporting to bring about your long sought key to riches and wealth, pouring in from heaven literally filling your baskets to overflowing! Unfortunately, these cons assume that you will not be privy to the knowledge concerning the law of reciprocity which states, "You reap whatever you sow".
There is nothing for nothing; value must precede income or wealth in all instances without exception. You must bring in value into any endeavour in order to earn back the equivalent income or be recompensed or remunerated. If you do not bring this "value", you cannot gain genuine wealth.
Let me set the record straight: all organisations, governments and corporations are pyramids. The only difference is that they are legal pyramids. This means that they all have a base and the top. The top has its leader - CEO, president, etc - and the bottom has the people whom this structure serves.
In a typical pyramid, the power is always at the bottom and is given to the top. The value comes from the top to the bottom, For instance, a government's power is not at the top but it's at the bottom with the people, and value is at the top with the leaders. If value does not come from the top to the bottom and people are disillusioned, then power does not go up. The power in this case is the vote.
The above example shows you that any legitimate pyramid must always have a balance between power and value, value comes down in the form of goods or service, power goes up in the form of votes, reverence, dollars etc. If this balance is not maintained, then the pyramid will collapse, no matter how much force, manipulation or trickery one may use.
Good examples of collapsing pyramids are the current turmoil and revolutions going on in Egypt and Libya. When the pyramid top stays for too long and value is not being perceived to trickle down to the base, then sooner or later the power will no longer go up because the base collapses, bringing down the entire system with it.
In business this is no different. All businesses are essentially pyramids, albeit legal ones. If a company does not provide great value in terms of their service or goods to their customers or staff, they become disillusioned and collapse become imminent.
Remember, if your service is second grade, for instance if you sell defective or counterfeit goods, not only will you be robbing the true owners of the goods through piracy and lost revenue, but you will disappoint the end user who will ensure that they never ever come back to buy anything valuable from you again.
That translates to lost income, a bad reputation and lost power. It is very difficult to gain back this once it's gone.
This now brings me to illegal pyramids.
These are business plans or ideas that sound legitimate but violate the rules of a sustainable pyramid structure because there isn't any value in this kind of business. They are usually based on money games where you invest money into some kind of club and then wait your turn to get paid. It is usually a structure that may work in two's or three's but seldom going beyond four.
The idea is simple enough. You are usually invited by a friend to purchase "certificates" or space in a succession ladder. When you buy these "certificates", you will be given two account numbers to deposit your money into. The first is to the "administrators" of the said business in some remote location too far to ever follow up.
The second account is of the individual who has reached the top of the ladder and is now the recipient of the moneys you deposit. When you pay the moneys required (equal amounts and can range from as little as $10 each or as much a $100 each), you will be sent three "certificates" with your name appearing at the seventh slot of the ladder list. You will then be required to find three people to sell these "certificates" to at the same price and repeat your process, except this time, there is a new name on the list due to receive money.
When your three clients have bought their "certificates", your name will appear at number six on theirs! If they sell theirs, the third generation will receive "certificates" with your name at number five. This goes on until your name is number one. That will be seven generations later and you start receiving money in your account for that entire generation of people.
Here's the arithmetic: you sell to three people, they sell to three and that goes on for seven generations by which time you have 2,187 people each depositing X amount of dollars in your account. Comes to a lot of money!
But it is illegal!
Why? This is because it violates all the rules of fair trade. And such schemes are known as ponzis and have had people arrested and locked up for years! Bernard Maddof is a good example of the same. This is because this model is not sustainable and always collapses in the end.
Join me next week when I break it down as well as name one big pyramid scheme in the country today currently posing itself as legitimate yet is conning and robbing citizens of their hard-earned income!
Don't say I didn't warn you!