At 10:10 PM 12/17/2009, OrionWorks - Steven Vincent Johnson wrote:
Abd remarks,
[...]
> What I do claim is that the Steorn situation bears very strong marks
> of being a con, a fairly sophisticated one, where they are
> deliberately setting up demonstrations with obvious flaws, which they
> can then remedy, setting up the rebound effect.
You may recall that I also recently voiced similar speculation. I also
speculated that STEORN is deliberately attempting to lead all the skeptics
and debunkers down to the slaughter house where at the right moment they
will all get wacked on the head. Very calculated... Very dramatic.
Yes. Noted.
However,
in my scenario, I seem to have come to a different conclusion. It seems more
plausible for me to speculate that Steorn actually believes that their ORBO
device is for real. IOW, I don't yet buy the premise that it's a con job.
I don't think you are considering the implications of that apparent
set-up sufficiently. The premise isn't an assumption, it's a
conclusion, from the consistency of the smoke-screen. Instead of
looking for the fire, look for smoke! Why is so much smoke being
generated? Demonstrations that don't demonstrate? That don't even
attempt to demonstrate, at least at first. It's a show, not a demonstration.
OF course, under my scenario it's quite possible that the Steorn engineers
have deluded themselves.
Sure. Or some of them are deluded and some are not, some are in. But
I have another hypothesis.
Please understand, I remain highly skeptical of Steorn's claims. Like
everyone here, I demand definitive evidence and am disappointed that Steorn
has not yet delivered on that point. Nevertheless I'm having a difficult
time perceiving how this "con" game you have described could possibly
benefit Steorn. If this is all nothing more than a deliberate (albeit
sophisticated) con game then it's all a house of cards and they will
eventually get caught. There's no way around the fact that they would
eventually get caught. The village will rise up in arms with pitchforks they
and torches in hand and run them all out of town, that is after they are
tarred and feathered and sent to the slammer. Granted, I could be wrong but
I really, REALLY have a difficult time believing they could be that stupid
as to believe they could pull off such a con job on the public, not with the
amount of constant scrutiny they are receiving.
Yet it appears to be working, Steven. You are making assumptions
about how they will proceed, and, also, assumptions about what is
involved in the NDAs.
When do they get to eat their cake? More to the point, how can they get to
the cake without getting the heads cut off?
They are already eating the cake, for some years now, and the cake
continues to be baked and served to them as long as there is positive
cash flow, which there may be. And when the cash flow goes negative,
the corporation goes bust, and those who collected salaries keep the
money. And the directors may be on the hook if there are burned
creditors, but they could easily arrange that the corporation closes
down without doing that. They pay their bills, it's that simple, the
directors make sure that this happens, but they are not required
legally to ensure success, and, I'm quite sure that the investors,
who will be the real losers, are themselves involved in agreements
that protect the personal property of Steorn officers and employees.
The Developer agreement is quite well-laced with clauses that
disclaim any claims of functionality.
You imagine that they would be tarred and feathered and jailed. Okay,
"jailed." What would be the charge? Deceiving the public? But that is
not generally a crime, and magicians do it all the time. Deceiving
people who purchase the right to see the technology? Without knowing
the NDA contents, it's difficult to know that there has been any
deception of these people at all. As one extreme, what you get when
you sign the NDA is a disclosure that there is this idea that might
result in over unity power, but that they haven't proven it yet, they
are working on it. Or perhaps there is a disclosure that it's all for
show, and if you reveal that, well, you will be sued. They gave you
what you paid for, the "secret."
Perhaps they offer your money back. Why wouldn't you go for that?
Well, there is a kicker: if you don't ask for your money back, you
will get a cut of all the new sales of disclosure agreements. They
can refund the money, they can keep it for long enough that the
interest on it will cover their expenses of refund. The agreement the
person signed allows them delay in refund. And they perform on the
agreement until they can't. When they can't, the thing will collapse,
and so their game is to see how long they can keep it going. When it
collapses, sorry, you have an agreement with a defunct corporation,
and you are last in line. Employees get paid first, you know. As I
mentioned, the board may act to ensure that you don't actually get
burned. You'd get your actual investment back, I'm pretty sure. If
you decide to keep the "investment," which they make it become, you
may not have any right to continued payments, even if you haven't
gotten your money back. You have become one of the investors, and for
all we know, those investors are happy. Do we know Steorn's income
from paid disclosures compared to what's been invested and spent?
Steorn is also selling products. Those products get attention because
of all the flap about Orbo. My guess is that those products will expand.
Sure, it's relatively short-term. But I've seen corporations act that
way. The officers get their salaries, and that, for them, is the
goal. Fat salaries, sometimes.
It's a business, and as far as I can tell, it may be running in the
black. If they are playing it right, they could be completely
deceptive, but as long as the aren't deceiving people who invest, I
doubt there is a crime here. We may be outraged, we may scream and
yell "con men!"
So? Will that make their vacations in the Bahamas less enjoyable?
Will people refuse to take their money?
Consider Hoyt's response. I presume he paid to join the club, or
maybe not. But he signed the NDA. Does he have some income from
Steorn? He hasn't told us, and the NDA apparently would forbid his telling us.
Really, it could be quite well-designed and quite sophisticated to be
legally bullet-proof. And those who fork over the developer fee and
are admitted may be perfectly happy with the outcome, if they have
arranged it properly. For a mere $400, they get an income stream. Or
they get their money back if they ask for it immediately. It only
takes a certain number of people accepting this deal to make it work,
and it's like a chain letter or Ponzi scheme, some investors know
exactly what is happening and that it can't be sustained, but they
also know that if they get in soon enough, they will profit handsomely.
My ex-wife knew someone who joined the Circle of Gold, something like
1978 or so. Cost her $100, net, as I recall, and she got back on the
order of $50,000. But her friends (or friend's friends, etc.) lost
$100, the very reason this person made so much money was that she had
many friends who bought the idea, some of them made some money, some
lost some money, and the balance, eventually, was negative. Slightly.
A method of transferring wealth from many to few, minus postage
costs. How to Turn your Circle of Friends into a Circle of Gold. It
worked. Was it illegal? Yeah, I think so, because there was some
phoney legal advice given in the letter. But by the time you realized
the problem, you'd already sent that letter to someone else, you had
become part of the scheme. So are you going to report this to the
authorities, file a complaint? I never heard of a prosecution. People
just accepted the $50 loss.
After all, they knew that was the risk, people aren't entirely
stupid. They simply overestimated their ability to sell the letters,
they didn't realize how many of their friends had already bought in,
they came in too late.
(As I recall, the way it worked, you'd buy the letter from someone,
who was supposed to walk with you to the mailbox where you mail $50
to the top name on the list, and also receive from you $50. So you
have paid the person back $50 of their $100 investment, and all they
have to do is sell one more letter and they break even. People are
distracted by the possibilities! How many of them thought to consider
how the letter got started? The first letter had to have a series of
names on it. All those names would be either the originator, or
perhaps friends of the originator. In other words, the foundation was
actually a kind of fraud. But by the time that this thing spread
widely, those people had all been fully paid, lots of money. I forget
how many names were on the list, but it was large enough that with
doubling as a mininum, they received a lot of $50 payments.)
> And remember, it doesn't have to convince everyone. Just a few. They could
keep this up for a long time!
I disagree. I think Steorn would have to convince a LOT of people in order
to pull it off, but in the end it would still fail - they will still be
tarred and feathered. It's my understanding that most con jobs are done with
as little publicity as possible since con artists typically go after the
ignorant and uneducated, and the best way to accomplish that is to operate
as discretely as possible - preferably from Nigeria! ;-) I realize some
might point to Madoff as an example of a high profile successful con job.
But again I disagree. I realize many people got bilked out of billions of
dollars, but eventually, Madoff didn't succeed, and where is he now.
Madoff was defrauding investors. Is Steorn? What makes you think that
they are? Do you know the content of the agreements? What they say in
public is legally irrelevant, in fact, if they don't defraud the
investors. I don't see any signs of defrauded investors suing.
I suspect that many are assuming that this means Orbo works. That's naive.
> Here is what I'd say: anyone considering investing in Steorn should get
together with
> others considering the same. If the possible investors were to cooperate
with each other,
> they could be protected. Steorn may try to defend against this, but the
very defense would
> be visible
Sounds sensible. I personally would demand that before I would be willing to
open up my check book that I be personally shown the device running. The
contraption had better be powering a light bulb with NO batteries in sight!
I would also demand that I be allowed to bring in anyone of my choosing whom
I knew to be competent in engineering principals, preferably electrical
engineering who could advise me.
And Steorn would simply say, No. We don't need people like you. Or
they would say Yes, and let you figure it out, at your own expense,
and the agreement would completely protect them. Whatever is most
likely to line their pockets. That is their goal, isn't it? They are
a for-profit corporation. Unfortunately, there are no laws actually
requiring that such corporations not lie. They can, and do, lie all
the time, and if it is mere puffery, and if no customer or investment
is actually defrauded, in the end, it's all moot. Note that puffery
isn't fraud. Caveat emptor. Some state consumer protection laws do
protect against material puffery, but I think it's the exception, but
what customers does Steorn have? They have customers for their Hall
effect sensors and torque measurement technology. They will sell you
some of the equipment that you would use to evaluate Orbo.... Is the
equipment fraudulent? Probably not! Good, worth the price? I'd say,
maybe, inclined toward probably not.
Yes, it is fun to watch, especially when one has no financial involvement!
It might be even more fun for those who do! And for those who did buy
in and received a refund. Both of these can pat themselves on the
back for their smart decision.
I'm still waiting for them to screw in the light bulb and get rid of the
battery. That might pique my interest.
Absent full disclosure and access, it will mean nothing. It could be
a total show, hidden batteries, and so what? It's not a crime to put
on a show! Only if they are actually defrauding investors would they
have a legal problem, and my guess is that they aren't. Investors who
actually buy in know what they are buying into, and would not be able
to sue if the thing collapses too soon for them to make a profit.
Brilliant, I'd say, I'm full of awe. And that's just at my own idea
of what they are doing! What if it is even smarter than that?
It could be both, you know. They might believe they have a technology
and they just need to perfect this last detail.... and they know and
have seen other efforts fail because of the difficulty of that, so
they have set it up so that it won't actually fail completely, it may
peter out, the income stream, but they hope that they find the magic
wave of the wand before then....
But I don't see any evidence that they actually have something.
