It is very long but well worth the time it takes to read the whole thing.
The worlds smartest, most highly paid, financial experts forgot the third most important tenet of good lending, as they poured billions of dollars into a sunny, indolent black hole. They possibly forgot the second as well. These tenets are very simple.
- Are the assets being offered for security genuinely valuable?
- Can the lender really afford pay the interest and repay the principal?
- Does the lender have an above average personal factor? (Can he or she be trusted?)
Adolf's favorite quote:
On he went, describing a system that was, in its way, a thing of beauty. It mimicked the tax-collecting systems of an advanced economy—and employed a huge number of tax collectors—while it was in fact rigged to enable an entire society to cheat on their taxes. As he rose to leave, he pointed out that the waitress at the swanky tourist hotel failed to provide us with a receipt for our coffees. “There’s a reason for that,” he said. “Even this hotel doesn’t pay the sales tax it owes.”
And there is one underlying lesson. Never go to confession.
There is only one conclusion. Let them rot in their own putrid cauldron of stewing dishonesty and avarice.
One is drawn to conclude from this account that Greece is not a basket case.
A basket, unlike Greece, has some value.