4 ms·

I certainly hope it couldn't be legal. The _only_ way this idea meets my standards is if the loan is invested in a corporate entity which enables the recipient

I certainly hope it couldn't be legal. The _only_ way this idea meets my standards is if the loan is invested in a corporate entity which enables the recipient to fail and walk away from the debt (and assets, of course). Let me state this as clearly as possible for anyone that thinks this is a good idea: "excessive usury" is pure evil. Being able to walk away from failure and start again is the secret sauce that makes the American economy the envy of the world.

moe 18y ago
Amen. Part of my motivation to get an investor was precisely to offload that financial risk to someone else. I'm already putting in at least 2 years of my life, including a lot of blood and sweat. If I fail then the last thing I'd want is to spend another X years getting rid of that debt... Also I'm truly baffled at your statement of: even an entrepreneur who has failed to get rich by the end of the four year can resort to taking a job at a big company. One year of that will pay off most of the loan, and will allow him to take a separate loan from the bank to cover the rest. Excuse me? After the 4th year I'd owe you roughly $120000. Most of us mere mortals would probably need closer to 7-8 years to pay that back.
bokonist 18y ago
Why should personal debt contracts be legal but not equity contracts? Equity contracts are actually more progressive - you don't have to pay if you're not making anything, and those who strike it rich cover the costs of those who make less. I actually think we should fund the education system through personal student equity (rather than taxes and student loans). If a school fails to teach students to read, it will lose out when the kids cannot earn as much later in life.
shader 18y ago
Certainly excessive usury is wrong, but being able to walk away from debts causes it's own problems. Because of the ability for people to just walk away from debt, they acquire more of it without the attention of paying it off. This can cause lenders to be more wary of loaning money, as well as waste resources when that person spends the money on a house or other item they don't need and can't pay for.

moe 18y ago

Amen. Part of my motivation to get an investor was precisely to offload that financial risk to someone else. I'm already putting in at least 2 years of my life, including a lot of blood and sweat. If I fail then the last thing I'd want is to spend another X years getting rid of that debt... Also I'm truly baffled at your statement of: even an entrepreneur who has failed to get rich by the end of the four year can resort to taking a job at a big company. One year of that will pay off most of the loan, and will allow him to take a separate loan from the bank to cover the rest. Excuse me? After the 4th year I'd owe you roughly $120000. Most of us mere mortals would probably need closer to 7-8 years to pay that back.

bokonist 18y ago

Why should personal debt contracts be legal but not equity contracts? Equity contracts are actually more progressive - you don't have to pay if you're not making anything, and those who strike it rich cover the costs of those who make less. I actually think we should fund the education system through personal student equity (rather than taxes and student loans). If a school fails to teach students to read, it will lose out when the kids cannot earn as much later in life.

shader 18y ago

Certainly excessive usury is wrong, but being able to walk away from debts causes it's own problems. Because of the ability for people to just walk away from debt, they acquire more of it without the attention of paying it off. This can cause lenders to be more wary of loaning money, as well as waste resources when that person spends the money on a house or other item they don't need and can't pay for.