Quote from: JoelKatz on August 23, 2012, 03:49:05 PM

Read over the statement. I don't think it does. I'm not saying all investments are equal. I'm saying we've seen obviously absurdly bad investments that people have taken seriously and been willing to invest in. I believe that indicates a serious problem in the community.

My bad, I read it as if you were speaking about all offers. Then again whether or not there are some terribly unappealing investment offers doesn't seem too relevant to the case of vescudero and the like, which I was talking about regarding the notion of being too dismissive.

Since you haven't touched the subject of how vescudero's guarantee is worse than, say, CPA's guarantee, I'll go ahead and assume it's the fixed interest, which to me isn't very convincing. A better metric would be risk/reward ratio of running with the money, and I would more likely look at the deposited amounts. It fits perfectly to BTCS&T, MyBitcoin, Bitcoinica, bitscalper, REBATE and the like and excludes vescudero and CPA (for now of course).

Since no one is actually signing anything and almost all identities have almost perfect deniability, I would go a step further and suggest we usually include personality assessment when calculating the risk. This explains borrowers paying up after shutting down operation much better than "luck".

I think we both agree that these measures aren't good enough and we have to find a way to weed out scams. What we don't agree on is the hope that people will stop depositing money to fixed interest offers.

Quote from: JoelKatz on August 23, 2012, 03:49:05 PM

There is nothing inherently different in those two. Either of them could be perfectly legitimate if there's transparency. Both of them are bad investments if there's not. Investors should be careful with both such business plans.

Transparency is no absolute, and it can be very misleading for gullible investors. For those who can assess the risk, this is already not a black and white thing.

Quote from: JoelKatz on August 23, 2012, 03:49:05 PM

What exceptions are there to the rule that an investment with no transparency or that promises suspicious return relative to risk is almost certainly a scam? (Or, in the rare case where there really does seem to be an unusually good business plan, must at least be evaluated with extremely heightened suspicion to ensure it's not a scam.)

Even if there aren't any exceptions, you've successfully excluded everyone who claims (truthfully or untruthfully) to be even a little transparent, which almost all do. Also how do you measure suspicious returns? I remember my bank offering more than 100% "overnight" interest for extended periods, even when the inflation rate wasn't as high as Bitcoin's.

If we add some tolerance to the claim, then the ones that have paid up all debt before shutting down operation so far become exceptions, which are AFAIK all of the offers so far (hopefully pirate will be the first one to successfully complete a Bitcoin based HYIP scam). Should we do a generalization based on this sample? The same goes for other sorts of extreme generalizations.

So in summary, when you say that a well known person who gives a guarantee for deposits, who is limiting the total deposits to an amount that's not worth stealing, and who is mostly transparent with his investments is a Ponzi scheme because he's paying out interest more than banks do (but well within range of what can be done in the market), the argument seems to me to lose credibility. He might still steal my money, but the reasoning behind why the risk is supposed to be higher than any other investment option (available currently in the greater Bitcoin market) isn't clear at all.