IMAGINE HOW BRIGHT YOU HAVE TO BE...:

Trail of risky investments in China: As many as 1 million people lost money farming ants for a health products company; critics say the bugs were bait for a pyramid scheme. (Mark Magnier, 1/12/08, Los Angeles Times)

The illiterate farmer has hardly slept for weeks, and when he does he has nightmares. His breathing is irregular; his brow heavy.

The source of his anxiety? A tower of cardboard boxes in the next room.

Filled with ants.

After more than four decades of backbreaking work tilling the soil, Li Fanghai, 62, and his wife had managed to save $11,000, which they invested in ant farming.

These ants were far more than uninvited picnic guests, the couple were told. When ground into a powder, they become an aphrodisiac, a kidney purifier and general cure-all, the Yilishen Tianxi Group declared. The ants would earn them a 30% annual return.

In reality, critics say, the ants apparently were little more than the bait for a vast pyramid scheme. Over an eight-year period, the company recruited as many as 1 million would-be ant farmers, collecting about $1.2 billion. In mid-December, it filed for bankruptcy.

The story of Yilishen illustrates the get-rich-now mentality here, the constant search for a new angle by those struggling to make a go of it with the communist economy having all but given way to private enterprise, and the frequent collusion of government officials in shady dealings.

...to not understand why American debt is so attractive to the Chinese and vital to the world economy?

Posted by Orrin Judd at January 12, 2008 9:24 AM