<description>&lt;p&gt;Sam Israel had a problem. The investors in his hedge fund, Bayou Capital, were expecting spectacular returns. Sam himself had spent years proclaiming the fund's brilliant results. In reality, Sam had been marking his own homework, publishing fraudulent accounts and using these to lure in new investors. &lt;br&gt;&lt;br&gt;What to do? Well, the logical thing of course: wait around for an extraordinary profitable streak, and in the meantime keep up the ruse...&lt;br&gt;&lt;br&gt;We're bringing you an episode of &lt;a href="https://podcasts.apple.com/us/podcast/cautionary-tales-with-tim-harford/id1484511465"&gt;Cautionary Tales with Tim Harford&lt;/a&gt;. This episode was recorded live at the Bristol Festival of Economics and studies three incredible investment scams. How do pyramid and ponzi schemes snowball out of control, flattening victim and fraudster alike?&lt;br&gt;&lt;br&gt;For a full list of sources, see the show notes at &lt;a href="https://timharford.com/"&gt;timharford.com&lt;/a&gt;.&lt;/p&gt;&lt;p&gt;See &lt;a href="https://omnystudio.com/listener"&gt;omnystudio.com/listener&lt;/a&gt; for privacy information.&lt;/p&gt;</description>

The Dream

Little Everywhere

From Cautionary Tales: The Fraudster's Guide to Magic Money

APR 26, 202442 MIN
The Dream

From Cautionary Tales: The Fraudster's Guide to Magic Money

APR 26, 202442 MIN

Description

Sam Israel had a problem. The investors in his hedge fund, Bayou Capital, were expecting spectacular returns. Sam himself had spent years proclaiming the fund's brilliant results. In reality, Sam had been marking his own homework, publishing fraudulent accounts and using these to lure in new investors.

What to do? Well, the logical thing of course: wait around for an extraordinary profitable streak, and in the meantime keep up the ruse...

We're bringing you an episode of Cautionary Tales with Tim Harford. This episode was recorded live at the Bristol Festival of Economics and studies three incredible investment scams. How do pyramid and ponzi schemes snowball out of control, flattening victim and fraudster alike?

For a full list of sources, see the show notes at timharford.com.

See omnystudio.com/listener for privacy information.