Thursday, July 19, 2012

Advantage 42 – Low credit risk

Excerpt from the book »Gradido – Natural Economy of Life«


»Those who never take the smallest risk
run the greatest risk in life.«
– Bertrand Russell
British philosopher and mathematician

The greatest risk lies in not making a loan because of the gradido’s perishability. Any loan, however unfavourable, would be better for the lender. That does not mean that you should make unfavourable loans. Should two out of ten loans not be repaid, you would still have the benefit of eight loans since the money from the loans that are not repaid would have been gone anyway if you had not lent the money.

Loan contracts are naturally just as binding as at they are at present. It is very easy for the borrower to repay the loan as money is plentifully available and therefore flows very generously. The risk of becoming insolvent is much smaller than in the present system and there will scarcely be any bankruptcies. 

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