It's a very simple concept, i.e. Ponzi Scheme.

People generally believe that gold is valuable and buying gold is believed to be a safer investment. Genneva uses selling gold as a mask. It's indeed a very good marketing trick; it wouldn't be so convincing selling things other than gold.

So, what is Ponzi Scheme?

A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from profit earned by the individual or organization running the operation. -- Ponzi Scheme, Wikipedia


-- extracted from http://www.ericgarland.co/2012/09/03/more-...s-ponzi-scheme/ without permission

Genneva operates in the aforementioned operation.

Let
x = market price of 10g gold
y = genneva price of 10g gold, y > x
z = y - x (so-called investment)

Similarly, Genneva pays returns to its "investors" from their own money (z) or the money paid (z) by subsequent "investors", rather than from profit earned by individual or organization running the operation.

Get it?

This post has been edited by Y-shapedTwig: Oct 4 2012, 03:25 PM

*ROLLING MONEY*

It isn't sustainable if no one buys gold from them (a.k.a invests in their company).

GOLD is just a tool they use to convince their customer to *invest* z into their company.