Regarding the disastrous state of the finances of Thames Water and other water companies in the UK, how does taking on debt against assets to meet the demand of investors for a financial return differ from a Ponzi scheme, where new investors pay for the rewards to old investors without any meaningful investment by the broker in real assets (Thames Water in crisis talks over potential £10bn black hole, 28 June)?
When the music stops, as has happened with Thames Water, there are no liquid assets – especially funds in a bank account – to pay off the largest debtors, in this case the banks. I honestly think even Bernie Madoff couldn’t have pulled off a better deception.
Louis Berk
London
