"Ponzi schemes can generally be thought of as a lagging economic indicator – in prosperous times, the usually-outsized gains promised by the fraudsters are more easily accepted as possible with the backdrop of a booming economy, and investors are generally content to let their money work for them. As long as these times continue, and new investor funds continue rolling in, the scheme stays afloat and is able to meet its obligations to existing investors. Indeed, from October 2002 to October 2007, the S&P 500 Index gained over 100% – nearly 2% per month. Unsurprisingly, very few Ponzi schemes were uncovered during that period."
From Jordan Maglich's Forbes article:
A Ponzi Pandemic: 500+ Ponzi Schemes Totaling $50+ Billion in 'Madoff Era'