I recently read an article on dowser which detailed a conversation between David Bornstein and Dr. Yunus, the founder of the Grameen Bank (http://dowser.org/a-congressional-medal-for-dr-yunus/). The conversation begins with a conversation regarding the problems of the current financial system, "which only serves the top one-third of the world; two-thirds are left out". This is amazing to me. One of the biggest lessons I learned in my time in Finance classes was the liquidity of the capital market system. One of the huge benefits of this day and age is that you can easily buy and sell securities. However, it seems that some people can't even have access to the financial system. Borrowing and lending money is something that we take for granted. Just last week I bought a car and had to take out a loan to do so. I'm sure one day I will have to take a loan on a house in order to purchase one. Borrowing (assuming you are doing it responsibly) not only increases ones standard of living, but also enables a person to greatly increase their wealth. Each day, business' borrow huge sums of money so that they can buy new factories, buy new materials etc. In doing so, they can expand their business and have a return that is greater then the rate that they are borrowing at. Borrowing is the most feasible way to increase your wealth. Entrepreneurship would be dead without the ability to borrow money to start businesses. Thus, this thinking helped Dr. Yunus found the Grameen Bank, which helps the poorest people borrow money.
Another topic that Dr. Yunus spoke about was social business. Social business is very different than capitalism. Whereas capitalism is "interpreted as an exclusively profit-centric human engagement", social business is about focusing "on people and planet" - "a non-dividend company dedicated to solving human problems. In this type of business, "the owner will only get the original investment. Nothing more". When I first heard this type of business, I was extremely skeptical. After all, how can one sustain themselves without money. I understand that some people have truly altruistic intentions, but this type of business implies that someone will have to little on extremely low means. However, Dr. Yunis addresses this argument, as he says that social business ventures should be run parallel to profit making businesses. Through these thoughts, I think Dr. Yunis corrects a huge stereotypes now a days - that corporate business are evil people that are solely out for money. While some people may be like this, on the whole, at least from what I've experienced, these people are trying to do good as well. What I have seen in the corporate world are people who give back to the community. Deloitte Consulting hosts an "Impact Day" where everyone takes off of work and volunteers in some capacity. By encouraging people to also pursue this type of business, it could be a way to help spurn more social business. People can balance out their careers between pursuing profit-making business and social business. Just think of the good that people with real capital can do if they engage in some type of social business in their life. Now, people may be skeptical of this at first. After all, people in profit making businesses are very busy. However, if someone could find a forum to at least have the discussion I think the idea could take off. Who better to start this discussion then Dr. Yunis, who made borrowing for the poorest people a reality.
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