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Maud Dib
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Posted - 2004.02.13 14:28:00 -
[1]
The whole evebanker thing got me to thinking. Is there any interest in asset based loans. If there is I might set some sort of loan company up. Basically you would transfer the asset to me and I would loan you money at something like 80% of it's value. Then you would have a certain amount of time to pay back the loan. If that became a problem you could either workout new terms or forfiet the asset. I know there are trust issues but much less so than with anything else I could come up with.
Thought, ideas, flames?
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Top Dog
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Posted - 2004.02.13 14:32:00 -
[2]
Err....
I think that this would not work as you state the laon as this....
I give you an APOC value 100m You give me 80m as a loan.....
Why don't I just sell the APOC?
Why not have a loan based system, where you give a rate dependent on character with maybe a coporate guanrantor at 120% of asset value?
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Maud Dib
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Posted - 2004.02.13 14:40:00 -
[3]
Quote: Err....
I think that this would not work as you state the laon as this....
I give you an APOC value 100m You give me 80m as a loan.....
Why don't I just sell the APOC?
Why not have a loan based system, where you give a rate dependent on character with maybe a coporate guanrantor at 120% of asset value?
Well in theory I was thinking of assets you didn't want to sell but didn't need right then. Say your backup battleship. Your idea does have some merit though. Maybe a combo of them say straight loans for people who have been around a while and asset backed for newer or less savory people.
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Asharee Intrefer
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Posted - 2004.02.13 16:38:00 -
[4]
Isn't the correct term for this business "pawn shop"?
I think it's a nice idea, though, and I'm sure it could work with the right person running it.
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DeathBunny
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Posted - 2004.02.13 16:46:00 -
[5]
Mmmm Pawn Shop thats a good idea actually hehe. Fear The Bunny
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Mikelangelo
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Posted - 2004.02.13 17:38:00 -
[6]
Here's a thought for ya. Customer wants an 80 mil loan on his/her Apoc, payable in two weeks or he loses the Apoc collateral.
How does he know you just wont sell it on the market?
Easy, you would be required to put in on escrow, where it would remain VISIBLE, in a known system, for two weeks. Put it up for 160 mil or something, so nobody would buy it.
That way everything is verifiable.
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Maud Dib
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Posted - 2004.02.13 18:02:00 -
[7]
Quote: Here's a thought for ya. Customer wants an 80 mil loan on his/her Apoc, payable in two weeks or he loses the Apoc collateral.
How does he know you just wont sell it on the market?
Easy, you would be required to put in on escrow, where it would remain VISIBLE, in a known system, for two weeks. Put it up for 160 mil or something, so nobody would buy it.
That way everything is verifiable.
Thats a good idea. There would still have to be some trust but it's a start.
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Asharee Intrefer
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Posted - 2004.02.13 18:23:00 -
[8]
Why not simply put the item on escrow assigned to the client only at the cost of the loan plus interest? That way they can see that their asset still exists, and will also be able to simply claim the escrow to pay back the full loan at once if they wish.
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Maud Dib
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Posted - 2004.02.13 19:02:00 -
[9]
Thats so simple I didn't even think about it. Nice work. More suggestions are always welcome. Anything that grows the financial side of EVE is a good thing.
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Baldour Ngarr
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Posted - 2004.02.13 19:05:00 -
[10]
Quote: Why not simply put the item on escrow assigned to the client only at the cost of the loan plus interest? That way they can see that their asset still exists, and will also be able to simply claim the escrow to pay back the full loan at once if they wish.
You still have to, in effect, trade it to him for 80 mill and then trust him to actually put it on escrow.
What Maud Dib is proposing is, in effect, a pawn shop, where you can sell stuff at rather below market price and buy it back later at a fixed-in-advance premium. This is a fine idea, except that it still runs foul of the trust problem.
It's more likely to work, the bigger a chunk of the market price you offer to take items into pawn at. I guess it's a matter of how big a profit margin you want vs. how little a potential loss people are prepared to trust you with.
All of which said, there is, of course, another and bigger problem. The inflation/deflation rates in EVE vary on an enormous scale, over quite short periods of time. What happens if you pawn an Apoc today, when the market price is 120 mill, and then next week mega/zyd become widely available again and the market price of an Apoc plummets? Or vice versa?
If Maud Dib is honourable (and I assume he is) he'll honour the fixed-in-advance premium in spite of the Apoc's market value now being way higher than it was when you pawned it: but he'll also insist on that fixed premium if the market value has gone down. In which case, it'd be cheaper to just buy a replacement than un-hock your own.
In short, if ever and whenever the price of things goes down, the pawnbroker could suddenly find himself with a large stock of stuff, for which he paid, at the time, much more than it is now worth. Anyone running this business is taking a sizeable risk.
_______ "Soon" is an ancient Icelandic word meaning "some time before the next Ice Age." |
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Rinji
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Posted - 2004.02.13 19:38:00 -
[11]
Edited by: Rinji on 13/02/2004 19:41:41 Edited by: Rinji on 13/02/2004 19:39:11
Quote:
If Maud Dib is honourable (and I assume he is) he'll honour the fixed-in-advance premium in spite of the Apoc's market value now being way higher than it was when you pawned it.
Well he won't have a choice about honnoring it, since it will be in escrow at the agreed apon price. The bigger risk is the prce going down and his borower telling him to get bent: then his collateral would worth less then expected. Of corse, the bower's credit would then be shot, and if Maud Dib kept a credit history and insisted on dealing with main charecters he could keep track of those people, maybe selling his database to other "banks" too... the possbilities are interesting.
Falling asset values are a risk to any bank, and are often protected against by selling options... man, Eve needs a good stock market!
Vice Admiral Rinji Morisato Logistics Division Commanding Officer of Logistics Division |
Baldour Ngarr
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Posted - 2004.02.13 20:11:00 -
[12]
[quoteFalling asset values are a risk to any bank, and are often protected against by selling options... man, Eve needs a good stock market!
Very true: but in the countries where banking is a respectable industry, you tend not to have inflation running at 100,000% one week and minus 25,000% a couple of weeks later
It's workable, and I think it's a great idea if it can BE made to work. I merely point out some potential problems.
_______ "Soon" is an ancient Icelandic word meaning "some time before the next Ice Age." |
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