Its just Genneva very lucky that Gold Price appreciate. But for the past 1 year, gold price stagnant. So how does Genneva
get money to pay hibah, commission and running cost of company?

I would say Genneva at best is gold betting company. Genneva bet the gold rise exponentially. And Genneva customer loan
money to Genneva to make the bet.

i would class Genneva as a gold DERIvative company....its using gold to Derive its trades or sales.

i once said "IT COULD BE TULIPS FOR ALL PIPO CARE. AS LONG AS THEY GET THEIR HEEEE BAH!"

If like that, Genneva might be legal? Genneva really trade gold with its customer. And gold trading is not regulated. Genneva
might have found a loop hole in the law.

Legal here but illegal elsewhere.........such deposit taking. What i am saying here is they have NO actual tangible PRODUCT
cept what they call a trading PLATFORM.

They dont mind gold or do they even have a factory to mint their bars? Anyone CONsultant seen that?

Thye could have Tulip plantations and still trade such derivative...
Depends on the sentiment of the moment. At the mo, GOLD IS HOT. So ride on IT!

ehh.. like some MLM companies.. well Amway and Cosway thos established ones really got their good and bad products la..

those like Lampburger, simply take some Lamp ppl sold online and retail in Europe, asking for ppl join and pay Rm32k to manyzer.

Well, trading company no need to mine gold or mint bars. Trading can buy gold at current price, bet it will rise 40% every year so that it can pay 24% hibah to customer every year.

Voila, you can trading company and betting company in one place.

Hahaha.

Actually definition of trading company is first buy low, then sell high.

In the Genneva case, it sell high first (gold is sold higher price) then buy low (betting that gold price will be higher than buy back price). (does this also fits your description of futures derivative trading?)

Anyway, I agree with you about deposit taking is illegal in Genneva. Some said Genneva get deposit from customer but didn't deliver gold more than a few months which fits deposit taking charges. This is already contradict syariah law which that say gold must be deliver within 3 days.

This post has been edited by gogo2: Nov 2 2012, 08:41 AM

Amway actually manufactures some of their original products. They are not a sales man company per se.
They have a research dept in Nutrition and detergents.

Genneva hibah model is at 24% pa + commision to their consultants/agents at around 12% pa. That's a hefty 36% pa and we have yet to also include their overhead cost. So, gold will probably have to rise at about 40-50% pa just for their operation to be viable/profitable. We're also assuming that they will be able to sell their internally minted gold buillion to the open market at a price very close to the spot price (in the very unlikely event that the gold indeed does rise so substantially). Also, in the long run, what are the chances of this suceeding? Finally, this is a very stupid way to raise capital if indeed you do project gold to raise so substantially.

So yeah, Genneva's business is really nothing but a ponzi scheme.

If it is true that if GM sold a piece of gold over and over again to the same customer, gold value up didn't really help GM in generating profit. Simply because that GM has to fork out more to pay the same amount of customer.

So in order to be sustainable, GM has to be able to attract new customer even faster than before! Being unable to do so, or the gold price simply jumped too much, would lead to hard crash.

Frankly speaking GM make money via gold trading only by selling overpriced gold to their customer, nothing much about taking the trouble to hedge gold and wait for their rise - that would be risky, too slow to generate profit, and troublesome as compare to sit at home money pours in.

Just my crude view, I don't know their trade secret anyway.

This post has been edited by rexis: Nov 2 2012, 08:51 AM

Yeah, agree. But can they say they are trading gold with business plan of getting profit of 40-50%?

Example, I wanna do a trading company. Let's say I wanna do hardisk trading company. My business plan is to getting profit 20% only can survive. If getting lower than 20% profit, then I lose money and chaplap.

Isn't Genneva do the same thing? Genneva want to get 50% profit only can survive. So if lower profit, it'll chaplap. So its just a normal trading company. But with the illegal deposit taking, BNM can close it down.

Oh i didnt know syariah syas 3 days.....but we know ALL these are to hook up the muslims

Assuming gold price increase 50% per year

You mean:-
1 customer

2008
gold price = RM2000
buy genneva gold price = RM2500

2009
get Hibah = RM500
gold price = RM3000
sell back to genneva = RM2000
buy genneva gold price = RM3500

At this time, customer earn RM500 hibah
At this time, Genneva earn RM1000 (gold price increase) - RM500 (hibah) = RM500 (50%)

But of course, if we see the gold price today, its 0% gold increase in price from 2011 to 2012

yea they r a company with normal production, R&D et al, and using MLM as marketing strategy.

not a company with no product but adapt MLM strategy cum Pyramid and then just take some lamp, perfume or Rm8k per pcs pendant

Actually they just put a modern Flavour to the old Chinese way of borrowing money

As everyone agreed, only 50% increase year over year can make Genneva profitable or else, Genneva become ponzi scheme that depend on new victim to put in money to survive.

But from 2007 until 2012, only 117% increase. If we forget about compounding, for 5 years, Genneva need the gold price to increase 250%.

whats the old Chinese way?

i think the indian call it "Kutu"?

i only got chinese explaination, it's said to be the most ancient loan/financial aid of chinese

标会
http://baike.baidu.com/view/2095763.htm

he take Genneva Gold Buyer as equal as Property buyer... if developer mati half way the development then every buyer would cry and go on tv too..
--------------------------------------------------------

if a property developer mati pucuk half way mostly will not being hail as hero and surround by supporter as well having fan page

Something that I've forgotten to add on in my previous post, since the buyback clause is an option to be exercised at the discretion of the customer, if indeed gold do rise by 50% in that ever year, customer will have keep the gold instead selling it back to Genneva. So really, there is really no way Genneva to profit under this scenario either.

No comprehend Choinese.....