Re: human capital market

Lee Daniel Crocker (
Thu, 26 Feb 1998 11:27:25 -0800 (PST)

> >My partner and I have incorporated as an S-Corp. We have 100 shares of
> >Stock in our future income stream. We could sell these shares to anyone
> >under any contract arrangements we wish.
> Cool. But does this cover all future income, or just income earned via
> this corporation? And is this a percentage of gross income, or only after
> certain "expenses" are deducted? And could you contractually commit to
> retaining at least say 60% of your income shares, so buyers have reason
> to believe you will work hard?

The more I think about this "Human Capital Market", the more I'm
convinced that we already have exactly that, and have had them for
years--they're called Visa and Mastercard. What's the difference
between Grameen Bank's lending a man $100 to improve his farm, and
Visa lending me $300 for that new hard disk? Both have made an
investment in my future productivity, Visa just didn't ask as many

Theoretically it should be /more/ efficient at encouraging the kind
of speculative ventures that make big gains, because the person
receiving the loan has nothing to answer to except the payments--if
he wants to waste it on vacations, that's fine, as long as he makes
the payments. That's just more money in the pockets of that
industrious poolboy saving up for his delivery truck. It amounts
to the same thing--Visa is lending money to people to do whatever
they want, and left to their own ingenuity, people often like to
make more money.

Personal unsecured credit is essentially the same thing as a loan
on future income. We've all heard stories about entrepreneurs
being turned down for loans and starting businesses on their credit
cards. The movie _Hollywoord Shuffle_ was financed entirely on
Townsend's cards because no studio wanted it, and it did well.

Not to take away the good things Grameen does, but Mastercard did
it first, and does more.

Lee Daniel Crocker <> <>
"All inventions or works of authorship original to me, herein and past,
are placed irrevocably in the public domain, and may be used or modified
for any purpose, without permission, attribution, or notification."--LDC