But now illegal.
Still can. Just don’t get caught!
Remember what they said during our National Service time? Can do anything we want, just don’t…
The highest interest a fellow blogger got from his peer-to-peer lending “investments” is 18% interest per annum.
Already a sizable “discount” from the 25% that credit card companies charge for unsecured “loans” from individuals…
But if we compare against high yielding junk bonds, 18% is a lot better than the 6.5% yield Swiber bond holders got.
Well, so much for accredited investor “status”…
Some learnt the hard way that seeking out a vehicle yourself that you bought into is not the same as the one you were sold to.
Bond traders were once upon a time known as Masters of the Universe.
I personally think they still are.
There is a reason why there are so few retail bond investors/traders out there.
OK, I’ll concede the minimum $250K a lot is one deterrent. But we have the retail friendly Singapore Savings Bonds. Why the lack of retail interest?
I think we know the answer intuitively.
To be in the usury business, we need to be smart. Not just smart; but brilliant smart! And be really great with numbers!
What’s the similarity and difference between bond traders and illegal money lenders?
Both know how to price risk; the difference is that one got education at the right schools, the other just happen to have little schooling despite having a high IQ.
New readers may want to read this 2011 post of mine: Can you lend me some money?
Singapore Man of Leisure (welcome to my blog; just google it!)