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Submitted by Elijah Lineberry on Wed, 2007-08-29 20:19
As I write this a seventh finance company in New Zealand is about to collapse.
The announcement will be made in a couple of hours or so, according to the NZ Herald.
It has been a source of great delight to me these slimey financiers are dropping like flies as a result of their idiocy and bad management, and I suspect there are another half dozen companies who will collapse before the year is out.
I am taking bets from friends as to how long Geneva Finance lasts, (owned by yet another 1980s 'wide boy' who came to grief), once their 2 year Debenture notes start falling due in a couple of months time.
One aspect of this whole matter which has intrigued me is the drying up of investment money lodged with finance companies.
I find this absolutely shocking!
What it means is the entire finance company industry was a 'Ponzi Scheme', with total reliance on using the money of new investors to repay existing ones ...with a tacit endorsement from Lianne Dalzell about this being standard business practice!
Had these companies been more prudent in their lending and management there would have been no problems with redeeming investments as they fell due.
The Bridgecorp collapse I saw coming, and my only surprise was that it took so long!
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