Korean Job Discussion Forums

[RufusW]

The whole point of the industry is that is lends below 'market price' and more importantly it doesn't require any collateral - this is the fundamental/crucial part of micro-finance. If they can't repay it doesn't matter! 'Some' may charge more, but they're abusing micro-financing name - Yunnas does not do this - remember 98% repayment rate.

You argue Yunnas doesn't deserve a Nobel Prize - I'm amazed that if you read his book you don't believe this. His organisation, and banks such as BRAC have a huge following - millions. Maybe they're predatory, but if they were, would so many sign up for them?

Grameen average about 20% interest - far lower than someone without collateral could get.

What's the downside exactly?

[mises]

[RufusW]

No no no, if a poor person doesn't pay back their loan it's just lost - there's no collateral! Let me remind you - 90%+ repayment rate! The genius of micro-finance was lending without collateral - not putting the poor into a cycle of debt. This is why I don't think you understand what it was all about.

Grameen and BRAC have grown because it works. There are millions in Bangladesh who have gained from the idea.... there are now millions in Africa who have as well. Maybe the nobel prize shouldn't exist, but because it does, Yunus derserves it!

[mises]

I know how the system works. That they don't have collateral is why they and their country is permanantly, totally poor. It is also why any development scheme will completely fail to achieve anything lasting.

The microfinance industry has been around since the 1970s, mostly concentrated in Bangladesh, though it is branching out. So, in 40 years South Korea, Singapore, Taiwan went from third world to first. What has microfinance, with "millions of followers" accomplished in Bangladesh?

See, you can argue about the structure of this particular type of development scheme all you want. Over 40 years the country where it has been used the most is still among the most poor states on earth. A Nobel Prize in economics, if deserved by anybody, should go to Lee Kuan Yew or Park Chung-hee. They actually accomplished something big. A small time banker doesn't come close.

[RufusW]

So if a country doesn't have any collateral they're useless? Who made your shoes?

Mises, you're missing the whole point. Grameen structured it so collateral is unnecessary - a nation's collateral doesn't matter!

Did you really think micro-finance was going to lift the whole nation of Bangladesh/Africa out of poverty? You're seriously mis-guided. Micro-finance helps individuals, and in the long run - 20+years, will help the nation. You're crazy to think it'd have an effect after less than 10 years. Again, I doubt you understand the core principles.

Lee Kuan Yew or Park Chung-hee deserve it? What's their case? At least provide a link.

"a small time banker" - OMG, you misunderestimate Grameen and BRAC's reach, as I said before - millions of people. Grameen/BRAC - small timebanker, wow, it's probably one of the biggest banks in the world according to the population it lends to. I'm amazed you'd make that case Mises.

[mises]

[RufusW]

Yes, I'm drunk.

Mises, you keep pointing to people's research, at least quote it!.

Property rights aren't important. Remember the first person Yunnas helped, she didn't need any property rights at all, she just needed to escape the excessive costs of 'renting' materials... something a Grameen loan provided.

If you want to add up Grameen + BRAC customers I bet it'd be one of the largest banks in the world.... wanna go through with this? If you think Grameen/BRAC is a 'minor project' you're deluded.

The Nobel was for merely producing the (extremely efficient: yes, more than standard banks) idea, he didn't promise anything. Einstein didn't produce a light-speed spaceship but I'm sure he would have got a Nobel prize anyway.

No, Mises, provide a link to their work, regardless, the 'Asian tigers' were undoubtedly in a position to produce Western consumables, you think Bangladesh was in the same position?

[mises]

[RufusW]

No, Mises, that's not a link to their work.

If you really want to get into the effectiveness of Grameen I'll look it up.

[edited out drunken ranting]

[bacasper]

And to think - Machael Jackson's problem could all have been solved had someone offered him a microfinance loan!

[princess]

[bacasper]

Princess, did you sign the petition?

[RufusW]

Mises,

population of Singapore 4.8 million, independent in 1963.

population of South Korea 48 million, independent in 1948 - huge amount of U.S. aid.

Bangladesh, population 162 million, independent in 1971.

Grameen, total borrowers 7.3 million.

[Steelrails]

Michael Jackson Nobel Peace Prize- Gag!

Why is it every time a celebrity dies we feel compelled to give them awards? Between Lady Di, Heath Ledger, and now Michael Jackson I am sick of posthumous celebrity idolization.

[princess]