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Michael Chu, a veteran private-equity investor in microfinance and Harvard Business School professor, argues why lending to the poor shouldn't involve self-sacrifice.
Even so, Mr. Bernanke's remarks suggested that the Fed was not sure why lending had contracted.
So sure, the question of why lending practices didn't vary more across locales, depending on the riskiness of individual markets, is a good one.
All these costs help explain why lending institutions specializing in vineyard properties expect a huge amount of due diligence on the part of prospective investors.
Each lending cycle creates more credit, which is why lending has always been carefully regulated by national central banks to ensure loans will, in general, be repaid and sufficient capital reserves are held.
Similar(55)
Why lend them such glory?
If you wouldn't, then why lend to Uncle Sam at 3.3percentt for 10 years?" Bubbles may become the rule, not the exception.
Why lend to AA credits at 9% with a projected default rate of 0.2% when you can lend to the Cs at 17% and a default rate of 3.3%?
Here's how.
But recently even surveys from small-business associations suggest that poor access to finance is not the main reason why bank lending to businesses is falling.
Why risk lending money to a corporation or buying its stock, when you can reap a better return betting on whether the stock will rise or fall?
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com