Ponzi's Scheme_ The True Story of a Financial Legend - Mitchell Zuckoff [43]
Best of all, Ponzi was certain it was legal. The coupons were, in effect, legal tender used to buy stamps anywhere in the developed world. If a coupon bought more stamps in Romania than Rhode Island, that was not his fault. He was merely the first person smart enough to figure out how to take advantage of it. On the other hand, he acknowledged, some people might say exploiting exchange rates by trafficking in postal coupons might not be entirely ethical. But his experiences during the sixteen years since he’d arrived in America made that a secondary consideration: “Environment had made me rather callous on the subject of ethics. . . . Then, as now, nobody gave a rap for ethics. The almighty dollar was the only goal. And its possession placed a person beyond criticism for any breach of ethics incidental to the acquisition of it.”
In the weeks after devising his plan, Ponzi appealed to anyone he thought might have significant amounts of available cash. But everyone he knew in that position declined his offer, at least in part because Ponzi refused to provide many details about his idea, lest would-be investors try it themselves. Also working against him was his lack of a track record to justify being entrusted with serious sums. He was close enough to touch success, but with one rejection after another he began worrying that once again wealth would escape his grasp.
With his debts rising along with his frustration, on December 1, 1919, Ponzi swallowed his pride and walked across town to Northampton Street, in Boston’s South End. There he found a little storefront with a sign displaying a cluster of three gilded balls—the universal symbol for a pawnshop. Ponzi stepped inside Uncle Ned’s Loan Company and fished four items from his pocket: three diamond rings that belonged to Rose and his own gold, open-faced pocket watch. If ever Ponzi were looking for confirmation of Rose’s devotion, he needed to look no further than her willingness to let him pawn her rings.
Ponzi placed the valuables on the counter and told the pawnbroker, a Russian immigrant named Max Rosenberg, that he was hocking them to start a business. He outlined his coupon idea in the hope of enticing Rosenberg to invest. Rosenberg listened to his pitch, but pawnbrokers as a rule do not invest with men who hock their family jewels. Rosenberg appraised Ponzi’s belongings and handed him five hundred dollars for the rings and twenty for the watch. Ponzi stuffed the cash into his wallet and left.
His debts approached three thousand dollars and, as Ponzi liked to say, his only assets were his hopes. So the money from Uncle Ned’s did not last long. Just over a week later, Ponzi’s wallet was empty again when furniture dealer Joseph Daniels walked through the narrow, glass-paneled door of Room 227 in the Niles Building. Ponzi was behind on his five-dollars-a-month payments, and Daniels was threatening to haul the desks and chairs back to his store in the North End. Seeing the angry look on Daniels’s face, Ponzi was glad he and Daniels were the same height.
“For the love of Mike, sit down,” Ponzi told him. “That chair is still yours, and [sitting in it] won’t place you under any obligations.”
Ponzi had no money for Daniels—“I did not have it, and that settled it,