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Mobile Loans Ponzi
jmbada
#81 Posted : Friday, January 11, 2019 12:59:44 PM
Rank: Member


Joined: 1/1/2011
Posts: 287
But I do concede that the Central Bank cannot truly control rates.
tom_boy
#82 Posted : Friday, January 11, 2019 2:06:02 PM
Rank: Member


Joined: 2/20/2007
Posts: 533
tom_boy wrote:
I think this discussion has really digressed. But it has been interesting for me.

I guess a major question to be answered is " Do mobile loans lead to an increase in money supply? "

Money may not be available to the middle class conventional / traditional bank borrower, but has money become more available to the 70% of low income earners that constitute this economy?

Does the typical mobile loan borrower think about interest rates? Would it be a moot point trying to use normal free market logic to say with high borrowing rates, inflation rate will slow down? Of course the premise of this free market theory is that borrowers are rational and will avoid borrowing when rates go up and vice versa. Does this apply to mobile loan applicants?


As a follow up, if we apply a principle that all human beings are the same and aspire to the same things in life, why is it that in states of low interest rates when credit is availed to middle class via conventional bank borrowing, most of the increased money supply goes to consumption.

However, when this same credit is availed to the mobile borrowers we have swallowed the lie that most of this money is going to fund and capitalize hawker and mama mboga businesses. Is this not a great disconnect in thinking and application of economic theory.
They must find it difficult....... those who have taken authority as the truth, rather than truth as the authority. -G. Massey.
murchr
#83 Posted : Friday, January 11, 2019 4:53:31 PM
Rank: Elder


Joined: 2/26/2012
Posts: 13,746
tom_boy wrote:
tom_boy wrote:
I think this discussion has really digressed. But it has been interesting for me.

I guess a major question to be answered is " Do mobile loans lead to an increase in money supply? "

Money may not be available to the middle class conventional / traditional bank borrower, but has money become more available to the 70% of low income earners that constitute this economy?

Does the typical mobile loan borrower think about interest rates? Would it be a moot point trying to use normal free market logic to say with high borrowing rates, inflation rate will slow down? Of course the premise of this free market theory is that borrowers are rational and will avoid borrowing when rates go up and vice versa. Does this apply to mobile loan applicants?


As a follow up, if we apply a principle that all human beings are the same and aspire to the same things in life, why is it that in states of low interest rates when credit is availed to middle class via conventional bank borrowing, most of the increased money supply goes to consumption.

However, when this same credit is availed to the mobile borrowers we have swallowed the lie that most of this money is going to fund and capitalize hawker and mama mboga businesses. Is this not a great disconnect in thinking and application of economic theory.


It digressed because you got it wrong from the word go. A mobile loan is not a "quick profit"

if this post didnt help you you cannot be helped http://www.wazua.co.ke/f...amp;m=859027#post859027

By the way, this reminds me of the taxation of facebook and google thread Pray bye
"There are only two emotions in the market, hope & fear. The problem is you hope when you should fear & fear when you should hope: - Jesse Livermore
.
tom_boy
#84 Posted : Friday, January 11, 2019 5:07:13 PM
Rank: Member


Joined: 2/20/2007
Posts: 533
murchr wrote:
tom_boy wrote:
tom_boy wrote:
I think this discussion has really digressed. But it has been interesting for me.

I guess a major question to be answered is " Do mobile loans lead to an increase in money supply? "

Money may not be available to the middle class conventional / traditional bank borrower, but has money become more available to the 70% of low income earners that constitute this economy?

Does the typical mobile loan borrower think about interest rates? Would it be a moot point trying to use normal free market logic to say with high borrowing rates, inflation rate will slow down? Of course the premise of this free market theory is that borrowers are rational and will avoid borrowing when rates go up and vice versa. Does this apply to mobile loan applicants?


As a follow up, if we apply a principle that all human beings are the same and aspire to the same things in life, why is it that in states of low interest rates when credit is availed to middle class via conventional bank borrowing, most of the increased money supply goes to consumption.

However, when this same credit is availed to the mobile borrowers we have swallowed the lie that most of this money is going to fund and capitalize hawker and mama mboga businesses. Is this not a great disconnect in thinking and application of economic theory.


It digressed because you got it wrong from the word go. A mobile loan is not a "quick profit"

if this post didnt help you you cannot be helped http://www.wazua.co.ke/f...amp;m=859027#post859027

By the way, this reminds me of the taxation of facebook and google thread Pray bye


It is good you remember. Taxation on big data is coming. Like it or not.
They must find it difficult....... those who have taken authority as the truth, rather than truth as the authority. -G. Massey.
murchr
#85 Posted : Friday, January 11, 2019 5:28:19 PM
Rank: Elder


Joined: 2/26/2012
Posts: 13,746
tom_boy wrote:
murchr wrote:
tom_boy wrote:
tom_boy wrote:
I think this discussion has really digressed. But it has been interesting for me.

I guess a major question to be answered is " Do mobile loans lead to an increase in money supply? "

Money may not be available to the middle class conventional / traditional bank borrower, but has money become more available to the 70% of low income earners that constitute this economy?

Does the typical mobile loan borrower think about interest rates? Would it be a moot point trying to use normal free market logic to say with high borrowing rates, inflation rate will slow down? Of course the premise of this free market theory is that borrowers are rational and will avoid borrowing when rates go up and vice versa. Does this apply to mobile loan applicants?


As a follow up, if we apply a principle that all human beings are the same and aspire to the same things in life, why is it that in states of low interest rates when credit is availed to middle class via conventional bank borrowing, most of the increased money supply goes to consumption.

However, when this same credit is availed to the mobile borrowers we have swallowed the lie that most of this money is going to fund and capitalize hawker and mama mboga businesses. Is this not a great disconnect in thinking and application of economic theory.


It digressed because you got it wrong from the word go. A mobile loan is not a "quick profit"

if this post didnt help you you cannot be helped http://www.wazua.co.ke/f...amp;m=859027#post859027

By the way, this reminds me of the taxation of facebook and google thread Pray bye


It is good you remember. Taxation on big data is coming. Like it or not.


good luck
"There are only two emotions in the market, hope & fear. The problem is you hope when you should fear & fear when you should hope: - Jesse Livermore
.
MaichBlack
#86 Posted : Friday, January 11, 2019 5:39:15 PM
Rank: Elder


Joined: 7/22/2009
Posts: 7,192
murchr wrote:
tom_boy wrote:
tom_boy wrote:
I think this discussion has really digressed. But it has been interesting for me.

I guess a major question to be answered is " Do mobile loans lead to an increase in money supply? "

Money may not be available to the middle class conventional / traditional bank borrower, but has money become more available to the 70% of low income earners that constitute this economy?

Does the typical mobile loan borrower think about interest rates? Would it be a moot point trying to use normal free market logic to say with high borrowing rates, inflation rate will slow down? Of course the premise of this free market theory is that borrowers are rational and will avoid borrowing when rates go up and vice versa. Does this apply to mobile loan applicants?


As a follow up, if we apply a principle that all human beings are the same and aspire to the same things in life, why is it that in states of low interest rates when credit is availed to middle class via conventional bank borrowing, most of the increased money supply goes to consumption.

However, when this same credit is availed to the mobile borrowers we have swallowed the lie that most of this money is going to fund and capitalize hawker and mama mboga businesses. Is this not a great disconnect in thinking and application of economic theory.


It digressed because you got it wrong from the word go. A mobile loan is not a "quick profit"

if this post didnt help you you cannot be helped http://www.wazua.co.ke/f...amp;m=859027#post859027

By the way, this reminds me of the taxation of facebook and google thread Pray bye

Welcome to the sidelines @murchr

Some people will never let facts get in the way of a good argument.
Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
Angelica _ann
#87 Posted : Thursday, January 17, 2019 5:09:04 PM
Rank: Elder


Joined: 12/7/2012
Posts: 9,838
Kenya's Safaricom's overdraft service exceeds expectations -CEO https://af.reuters.com/a...fricaTech/idAFL8N1ZH32N
In the business world, everyone is paid in two coins - cash and experience. Take the experience first; the cash will come later - H Geneen
MaichBlack
#88 Posted : Thursday, January 17, 2019 6:34:31 PM
Rank: Elder


Joined: 7/22/2009
Posts: 7,192
Angelica _ann wrote:
Kenya's Safaricom's overdraft service exceeds expectations -CEO https://af.reuters.com/a...fricaTech/idAFL8N1ZH32N

A billion in 8 days!!!
Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
Angelica _ann
#89 Posted : Thursday, January 17, 2019 6:39:01 PM
Rank: Elder


Joined: 12/7/2012
Posts: 9,838
MaichBlack wrote:
Angelica _ann wrote:
Kenya's Safaricom's overdraft service exceeds expectations -CEO https://af.reuters.com/a...fricaTech/idAFL8N1ZH32N

A billion in 8 days!!!


This is crazy innovation. Yet more must be in the pipeline. This is a strong company.
In the business world, everyone is paid in two coins - cash and experience. Take the experience first; the cash will come later - H Geneen
MaichBlack
#90 Posted : Thursday, January 17, 2019 8:16:26 PM
Rank: Elder


Joined: 7/22/2009
Posts: 7,192
Angelica _ann wrote:
MaichBlack wrote:
Angelica _ann wrote:
Kenya's Safaricom's overdraft service exceeds expectations -CEO https://af.reuters.com/a...fricaTech/idAFL8N1ZH32N

A billion in 8 days!!!


This is crazy innovation. Yet more must be in the pipeline. This is a strong company.

True. Kudos to them.

Then some fellows start saying it is too big sijui bla bla bla nonsense and needs to broken up!
Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
wukan
#91 Posted : Friday, January 18, 2019 10:23:12 AM
Rank: Veteran


Joined: 11/13/2015
Posts: 931
tom_boy wrote:
I think this discussion has really digressed. But it has been interesting for me.

I guess a major question to be answered is " Do mobile loans lead to an increase in money supply? "

Money may not be available to the middle class conventional / traditional bank borrower, but has money become more available to the 70% of low income earners that constitute this economy?

Does the typical mobile loan borrower think about interest rates? Would it be a moot point trying to use normal free market logic to say with high borrowing rates, inflation rate will slow down? Of course the premise of this free market theory is that borrowers are rational and will avoid borrowing when rates go up and vice versa. Does this apply to mobile loan applicants?


@tom_boy what you are alluding to is the velocity of money. Prof Ndungu during his tenure had this big problem in 2011 when he was trying to keep rates low to spur growth but mpesa was increasing the velocity of money.I like it because it pops the illusion of central planning that central bankers tend to think they are gods to know what each person will do with money.

Quote:
The weak link in monetary policy is the connection between money as a stock and money in circulation, the so-called velocity of money. The velocity of the circulation of money refers to the frequency of the monetary transactions in an economy. One unit of money serves for several transactions over time.


Quote:
Whatever the aggregate used, the velocity of money can strengthen or weaken the effects of a change of the amount of money. The countermovement of the velocity can change an increase of the stock of money into a contraction or turn a monetary contraction of the stock into an expansion. Inflationary expectations lead to a higher ratio of the velocity of money while deflationary and dis-inflationary expectations lead to a lower ratio of the velocity.

The frequency of the monetary transactions depends on the decisions of the individual users of money in the economy. When people decide to use money more rapidly, the velocity rises, and this would accelerate the effect of the expansion of the monetary stock. When, in contrast, the public uses available money more slowly, the velocity falls. Such actions would offset the effect of the expansion of the stock of money, or, in the case of a reduction of the stock of money, accelerate the contraction.

The velocity of the circulation of money is subject to strong swings. Because the ratio is not stable, the effects of changes in the money supply are not certain. There are no tools to control the velocity. The monetary authorities are not able to foresee how the velocity of money will change. The trends may be long or short, and when they are long and seem to be stable, they may change abruptly. A reliable calculation of the future trend is not possible even if many data points are available.

Read the rest https://www.aier.org/art...y-and-why-does-it-matter
rwitre
#92 Posted : Friday, January 18, 2019 10:32:43 AM
Rank: Member


Joined: 3/8/2018
Posts: 210
Location: Nairobi
MaichBlack wrote:
Angelica _ann wrote:
MaichBlack wrote:
Angelica _ann wrote:
Kenya's Safaricom's overdraft service exceeds expectations -CEO https://af.reuters.com/a...fricaTech/idAFL8N1ZH32N


A billion in 8 days!!!


This is crazy innovation. Yet more must be in the pipeline. This is a strong company.

True. Kudos to them.

Then some fellows start saying it is too big sijui bla bla bla nonsense and needs to broken up!


Well at least someone has figured out how to milk money from Wanjiku.

KRA keep brainstorming.
Banks keep loaning to the government and complaining anga sijui rate cap.

MaichBlack
#93 Posted : Friday, January 18, 2019 5:34:25 PM
Rank: Elder


Joined: 7/22/2009
Posts: 7,192
rwitre wrote:
MaichBlack wrote:
Angelica _ann wrote:
MaichBlack wrote:
Angelica _ann wrote:
Kenya's Safaricom's overdraft service exceeds expectations -CEO https://af.reuters.com/a...fricaTech/idAFL8N1ZH32N


A billion in 8 days!!!


This is crazy innovation. Yet more must be in the pipeline. This is a strong company.

True. Kudos to them.

Then some fellows start saying it is too big sijui bla bla bla nonsense and needs to broken up!


Well at least someone has figured out how to milk money from Wanjiku.

KRA keep brainstorming.
Banks keep loaning to the government and complaining anga sijui rate cap.


Sio "anga"!!! Just pure commonsense. Why should I lend to you and your business at 14% with all your risks and logistics nightmare when I can lend to the government at an average of 13% depending on the instrument!!??
Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
rwitre
#94 Posted : Friday, January 18, 2019 6:34:47 PM
Rank: Member


Joined: 3/8/2018
Posts: 210
Location: Nairobi
MaichBlack wrote:
rwitre wrote:
MaichBlack wrote:
Angelica _ann wrote:
MaichBlack wrote:
Angelica _ann wrote:
Kenya's Safaricom's overdraft service exceeds expectations -CEO https://af.reuters.com/a...fricaTech/idAFL8N1ZH32N


A billion in 8 days!!!


This is crazy innovation. Yet more must be in the pipeline. This is a strong company.

True. Kudos to them.

Then some fellows start saying it is too big sijui bla bla bla nonsense and needs to broken up!


Well at least someone has figured out how to milk money from Wanjiku.

KRA keep brainstorming.
Banks keep loaning to the government and complaining anga sijui rate cap.



Sio "anga"!!! Just pure commonsense. Why should I lend to you and your business at 14% with all your risks and logistics nightmare when I can lend to the government at an average of 13% depending on the instrument!!??



Fast forward 10 years:
Safaricom:
- Has an iron grip on the telecommunications industry.
- Has a loan book equal to or bigger than Tier 1 banks
- Is the largest home security provider in the Eastern Africa region
- Has a cash flow larger than the GoK Treasury

We're a capitalist economy. Your goal is to make money in spite of the prevailing market conditions. You can innovate and offer new products, or keep sitting on piles of cash "because it is too risky to lend it out".
tom_boy
#95 Posted : Saturday, January 19, 2019 11:44:52 PM
Rank: Member


Joined: 2/20/2007
Posts: 533
rwitre wrote:
MaichBlack wrote:
rwitre wrote:
MaichBlack wrote:
Angelica _ann wrote:
MaichBlack wrote:
Angelica _ann wrote:
Kenya's Safaricom's overdraft service exceeds expectations -CEO https://af.reuters.com/a...fricaTech/idAFL8N1ZH32N


A billion in 8 days!!!


This is crazy innovation. Yet more must be in the pipeline. This is a strong company.

True. Kudos to them.

Then some fellows start saying it is too big sijui bla bla bla nonsense and needs to broken up!


Well at least someone has figured out how to milk money from Wanjiku.

KRA keep brainstorming.
Banks keep loaning to the government and complaining anga sijui rate cap.



Sio "anga"!!! Just pure commonsense. Why should I lend to you and your business at 14% with all your risks and logistics nightmare when I can lend to the government at an average of 13% depending on the instrument!!??



Fast forward 10 years:
Safaricom:
- Has an iron grip on the telecommunications industry.
- Has a loan book equal to or bigger than Tier 1 banks
- Is the largest home security provider in the Eastern Africa region
- Has a cash flow larger than the GoK Treasury

We're a capitalist economy. Your goal is to make money in spite of the prevailing market conditions. You can innovate and offer new products, or keep sitting on piles of cash "because it is too risky to lend it out".


Lets wait and see. Mobile loans dont make macro economic sense in the long run. Only good for fighting fires in your life. Mobile loans unless regulated will cause this economy serious damage. And that my friends is a promise!
They must find it difficult....... those who have taken authority as the truth, rather than truth as the authority. -G. Massey.
freiks
#96 Posted : Sunday, January 20, 2019 9:51:34 AM
Rank: Veteran


Joined: 6/8/2010
Posts: 1,602
tom_boy wrote:
rwitre wrote:
MaichBlack wrote:
rwitre wrote:
MaichBlack wrote:
Angelica _ann wrote:
MaichBlack wrote:
Angelica _ann wrote:
Kenya's Safaricom's overdraft service exceeds expectations -CEO https://af.reuters.com/a...fricaTech/idAFL8N1ZH32N


A billion in 8 days!!!


This is crazy innovation. Yet more must be in the pipeline. This is a strong company.

True. Kudos to them.

Then some fellows start saying it is too big sijui bla bla bla nonsense and needs to broken up!


Well at least someone has figured out how to milk money from Wanjiku.

KRA keep brainstorming.
Banks keep loaning to the government and complaining anga sijui rate cap.



Sio "anga"!!! Just pure commonsense. Why should I lend to you and your business at 14% with all your risks and logistics nightmare when I can lend to the government at an average of 13% depending on the instrument!!??



Fast forward 10 years:
Safaricom:
- Has an iron grip on the telecommunications industry.
- Has a loan book equal to or bigger than Tier 1 banks
- Is the largest home security provider in the Eastern Africa region
- Has a cash flow larger than the GoK Treasury

We're a capitalist economy. Your goal is to make money in spite of the prevailing market conditions. You can innovate and offer new products, or keep sitting on piles of cash "because it is too risky to lend it out".


Lets wait and see. Mobile loans dont make macro economic sense in the long run. Only good for fighting fires in your life. Mobile loans unless regulated will cause this economy serious damage. And that my friends is a promise!

There is no innovation that has ever been deemed positive, even in bible when Adam and Eve were caught it was deemed inappropriate and were chased from the Garden
Life is an endless adventure
tom_boy
#97 Posted : Sunday, January 20, 2019 10:12:28 AM
Rank: Member


Joined: 2/20/2007
Posts: 533
Beijing, China, Dec 6 – When Jia Xinru needed to borrow money to buy new clothes, order food and buy a projector to screen Breaking Bad on her wall, she had instant access to China’s growing number of lenders via her mobile phone.

The 24-year-old secretary is among millions of Chinese who have turned to proliferating online companies that dish out quick loans — and are worrying the country’s leadership.

On Friday authorities issued new rules on microlending, designed to protect consumers and limit risk for creditors. The move was the latest aimed at tackling financial risks as the world’s number two economy faces ballooning debt that has drawn warnings of a potential global financial crisis.
They must find it difficult....... those who have taken authority as the truth, rather than truth as the authority. -G. Massey.
tom_boy
#98 Posted : Sunday, January 20, 2019 10:14:09 AM
Rank: Member


Joined: 2/20/2007
Posts: 533
tom_boy wrote:
Beijing, China, Dec 6 – When Jia Xinru needed to borrow money to buy new clothes, order food and buy a projector to screen Breaking Bad on her wall, she had instant access to China’s growing number of lenders via her mobile phone.

The 24-year-old secretary is among millions of Chinese who have turned to proliferating online companies that dish out quick loans — and are worrying the country’s leadership.

On Friday authorities issued new rules on microlending, designed to protect consumers and limit risk for creditors. The move was the latest aimed at tackling financial risks as the world’s number two economy faces ballooning debt that has drawn warnings of a potential global financial crisis.


https://www.capitalfm.co...ding-crisis-fears-build/
They must find it difficult....... those who have taken authority as the truth, rather than truth as the authority. -G. Massey.
tom_boy
#99 Posted : Sunday, January 20, 2019 10:15:45 AM
Rank: Member


Joined: 2/20/2007
Posts: 533
tom_boy wrote:
[quote=tom_boy]Beijing, China, Dec 6 – When Jia Xinru needed to borrow money to buy new clothes, order food and buy a projector to screen Breaking Bad on her wall, she had instant access to China’s growing number of lenders via her mobile phone.

The 24-year-old secretary is among millions of Chinese who have turned to proliferating online companies that dish out quick loans — and are worrying the country’s leadership.

On Friday authorities issued new rules on microlending, designed to protect consumers and limit risk for creditors. The move was the latest aimed at tackling financial risks as the world’s number two economy faces ballooning debt that has drawn warnings of a potential global financial crisis.


https://www.capitalfm.co...ing-crisis-fears-build/[/quote]

But with an eye on predatory lending and its after-effects, the latest rules prohibit lending to consumers without income and cap interest rates at 36 percent annually. Regulators will also stop the approval of new online micro lenders.
They must find it difficult....... those who have taken authority as the truth, rather than truth as the authority. -G. Massey.
tom_boy
#100 Posted : Sunday, January 20, 2019 10:17:34 AM
Rank: Member


Joined: 2/20/2007
Posts: 533
We need this mobile lending to be regulated. China realised this fact in 2017. Are we bigger than China? Are we special in a way to make us not feel the effects of such reckless lending?
They must find it difficult....... those who have taken authority as the truth, rather than truth as the authority. -G. Massey.
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