Terrible post, seemingly chatgpt generated for large sections (see chapter What Happens When Borrowers Miss Payments) and disappointing to see on the front page of HN. This is the quality and calibre of analysis I would expect to find on a LinkedIn feed post.
Burrito Now, Pay Later
111–120 of 364 posts
Re: Burrito Now, Pay Later
#112> One reason is that someone’s or a company’s income doesn’t always align perfectly with when they want to buy things.
Financing should be used for things that provide value over the time horizon it takes to earn the money to fully pay for them. If you finance things for less than that time horizon, you just end up getting more and more underwater. If you finance something that delivers value for ~6 hours then you probably shouldn't be buying that thing or your fiscal solvency is really headed for the cliff.
Re: Burrito Now, Pay Later
#113"This logic doesn’t change just because the thing being financed is a burrito."
Yes, it absolutely _does_ change. One might as well go all the way and start offering Oxygen or Water bonds. The immorality masking as morality here is insulting--not related, mortgage-backed CDOs during the financial crisis and "Pay Day" loans.
There are many, many fundamental individual needs and items (economic "utility") that, while financialization of them makes sense at the large scale (flood insurance, natural commodities trading, municipal infrastructure), makes zero sense (and is even amoral) on the individual and small scales.
Put another way, many bulk-health statistics (BMI, Blood Lipids, Heart-Rate) are useful to track for populations, but make little sense (and is wrong-headed) to extrapolate-down to the individual.
Just because you can, doesn't mean you should.
Re: Burrito Now, Pay Later
#114Earlier quoted context omitted.
In general, the availability of credit has been a positive economic factor that helps enable capital expenditures that otherwise would only be available to the wealthiest. Lack of such credit leads to capture of means of production and rent seeking behaviors in economic terms. However, it’s become more and more clear that not all credit is created equal and what you spend the resulting capital on matters a lot. If on…
Exactly. Key differences: - Houses are gaining value over time while consumer goods such as food, phones, TV, cars are loosing value over time. - A loan for a house can be paid back very slowly so that you effectively only pay your initial share of the price (and share the profits with the loan giver via interest). A loan for consumer goods must usually be paid back almost immediately.
It isn't just about appreciation. It is about utility and production.
A car loan can be a great investment if it gets you to a job you otherwise wouldn't have, even if it is going down in value.
Debt for an expensive degree that gets you a good job is the same, and entirely devoid of resale value. Debt for an expensive degree with no job prospects, not so.
Re: Burrito Now, Pay Later
#115This treatise, from someone obviously in the industry, is merely another payday loan shark attempting to justify the existence of their clearly predatory products. How many of the consumers of this product are even remotely able to comprehend the piece as-is described? The article describes a "complete market". Yes, a market that is completely able to extract as much money from an exploited, uneducated populace as po…
It's unhinged. > Is financing your lunch a sign of societal decay? Maybe, maybe not. Financing your lunch means you can't pay for your lunch. And then somebody comes to search profit in that. Yep, it's societal decay. Ah, but he draws the line at sports bets, he doesn't like that.
He doesn't want to admit to being the cause of the rot, it makes him feel bad (but not bad enough to not do it lol)
Re: Burrito Now, Pay Later
#116>Is financing your lunch a sign of societal decay? Maybe, maybe not. I'd have no problems with BNPL if wages kept up with necessities like housing, tuition, and healthcare, or if those services were provided to citizens for free in exchange for higher taxes. Or even if minimum wage would move, like, at all. What I think this is a better sign of is this: a very lopsided finance industry against workers and borrowers d…
>I hope they fuck up the implementation and end up losing money to hackers.
That is quite ungrateful to money lenders.
They could, like, not lend money to begin with.
Re: Burrito Now, Pay Later
#117He brushes over ethical concerns of BNPL but draws the line at sports betting. But BNPL by design encourages you to buy things you can't afford and complicates your finances with more timed bills to pay. It makes it more likely people don't budget well and form buffers. A PNBL would be better, add 10% tithe to every purchase that goes to a checking account. Once that reaches $1k it overflows to an index fund. He says…
From the consumer pov, why would I opt for a PNBL option? If I have the money on hand, wouldn't I just make a regular purchase? Not trying to be snarky, genuinely curious what the sales pitch is here.
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Re: Burrito Now, Pay Later
#118Debt makes sense for building assets, not for purchasing consumable commodities.
Re: Burrito Now, Pay Later
#119Re: Burrito Now, Pay Later
#120>Is financing your lunch a sign of societal decay? Maybe, maybe not. I'd have no problems with BNPL if wages kept up with necessities like housing, tuition, and healthcare, or if those services were provided to citizens for free in exchange for higher taxes. Or even if minimum wage would move, like, at all. What I think this is a better sign of is this: a very lopsided finance industry against workers and borrowers d…
> end up losing money to hackers. How do you imagine this would work for a company using normal fiat payment rails?
Quite a lot of security problems are someone fucking up something they shouldn't have. But honestly I haven't a clue.