A Ponzi scheme is a type of pyramid scheme where investors are paid returns from the enlistment of new investors, instead of from profits.  Bernard Madoff, former chairman of the NASDAQ, just got in trouble for this.  Neatorama makes the case that Social Security is essentially a Ponzi scheme as well because it provides investors (retirees) returns from the enlistment of new investors (taxpayers).  But those returns also include a little bit of profit because they're invested in government bonds.  However, the number of retirees will likely eventually outgrow the number of taxpayers, which will make the whole system implode.  Don't worry; I'm sure somebody will fix it eventually.