Hacker Newsnew | past | comments | ask | show | jobs | submitlogin

The greatest boon of credit is the generation of new businesses. IE, you fund a venture through a loan, which upon its success becomes a thriving business.

Beforehand, you could not save or afford the cost of the loan. Afterwards, you will make more than enough to pay it back.

Which is also the implicit risk credit is meant to impose on financers, which is why most countries have regulatory bodies that try to incentivize these kinds of loans. You put what you have up as collateral to try to make significantly more, but if you fail you lose a lot of ground and have to start over.



I'm not sure how this relates to the previous comment.




Guidelines | FAQ | Lists | API | Security | Legal | Apply to YC | Contact

Search: