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What are the magic words these people use to get a bank to give them millions of dollars, let them walk off with it, then eat the loss?
by hotnfresh 3y ago
What are the magic words these people use to get a bank to give them millions of dollars, let them walk off with it, then eat the loss?
- voisin 3y agoThe debt likely wasn’t a normal bank, and the interest rate was likely quite high. The parties making the loan were likely fully aware of the risk and thought the interest rate appropriate compensation.
- teo_zero 3y agoAre those banks the same that failed to recognize what a bad idea it was to bet on sub-prime loans before 2009?
- IAmNotACellist 3y agoThose WERE a great idea--as long as you weren't the one caught holding the bag
- chongli 3y agoWhat I don’t get is why we don’t consider it fraud to knowingly take a loan you have no intention of paying back.
- gruez 3y ago1. It is fraud 2. Is there any evidence that's ever the case from PE firms? Startups fail all the time, but I wouldn't characterize them as "knowingly take a loan you have no intention of paying back"
- ChoHag 3y ago[dead]
- refurb 3y agoIt's call "high risk debt". The high interest rate offsets the likelihood of default.