Corpus from Corpses

I first came across the notion of a tontine (TON-teen) trust in an Agatha Christie murder mystery. The structure of a tontine ("an organization of individuals who enter into an agreement to pool sums of money or something of value other than money, permitting the last survivor of the group to take everything") was a magnet for mischief, as members received increasing shares of distributions---and ultimately the corpus itself--as other members died. Tontine arrangements are now outlawed in most jurisdictions.

Professor Moshe Milevsky suggests that it is time to resurrect tontines as a retirement planning device. Not only is it impossible to outlive the funds, a tontine is one of the rare investments whose returns are guaranteed to increase over time. The good professor is not blind to the drawbacks.

the objections include: moral hazard ("Do you want a bunch of old people running around killing each other?") regulatory concerns ("The insurance commissioner will never go for it.") and sale concerns ("People hate giving up principal. It wouldn't be profitable.")

He need not be so pessimistic about tontine's prospects. It's a fair bet that the financial wizards of Wall Street are transforming this 19th-century device to make it palatable to 21st-century suckers investors. After all, Ponzi schemes pop up every 20 years or so under different guises. There's a new generation to educate!