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Does it? You could equally well argue that punishing CEOs for bankruptcy makes banks more willing to lend money, improving the business climate. And of course
by wongarsu 4y ago
Does it? You could equally well argue that punishing CEOs for bankruptcy makes banks more willing to lend money, improving the business climate.
And of course for startups in the early years it's not that relevant anyways, since nobody will lend you anything until you have revenue. VCs invest instead of lending and aren't owed anything if you shut the company down.
- AbrahamParangi 4y agoWell, you’re basically taking something (cost of capital) that could be priced (via interest rates and collateral requirements) and turning it into a regulatory barrier. Personally I doubt that that is better, and I think the general consensus is that it is quite a bit harder to do business in those places with these regulations.
- mlyle 4y ago> You could equally well argue that punishing CEOs for bankruptcy makes banks more willing to lend money, improving the business climate. Banks can take into account the borrowing history of the executive teams already. > And of course for startups in the early years it's not that relevant anyways, since nobody will lend you anything until you have revenue. Being unable to make payments on leases, etc, is pretty likely for startups that fail.