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Darth Vader's wife likes micro-finance
Ms Portman, the 25-year-old Harvard graduate who co-chairs the Village Banking campaign, said it would seek to use social networking to galvanise her generation to support microfinance.
"I have seen that ending poverty is possible - it is just a mouse click away," said Ms Portman, whose video diary about Finca's work will feature on its page on MySpace, the social networking website. "People check their MySpace pages 10 times a day, why not harness that tool to build support for microfinance."
Here is the story. Complain all you wish, as celebrity activism goes this is a step up. Here is an article on micro-finance spreading to Africa.
Posted by Tyler Cowen on May 3, 2007 at 01:46 PM in Current Affairs | Permalink
Comments
Of course, if governments allow for financial system freedom with only the most small and reasonable amount of regulation, as well as registering and enforcing real private property, people could just get bank loans or credit cards...
Micro-finance is a symptom you find in countries whose governments over-regulate the financial sector and/or do not respect private property.
Posted by: Mr. Econotarian at May 3, 2007 2:10:54 PM
"financial system freedom with only the most small and reasonable amount of regulation"
- Unfortunately, many of us believe "small" and "reasonable" may not be compatible with each other or with "respecting private property" when it comes to finance, given the potential for corruption that it presents.
Posted by: tom s. at May 3, 2007 2:36:05 PM
Portman isn't really Vader's wife, but since you brought it up...
"Is microcredit really what these countries need? Won't the same processes that corrupt existing
institutions in the third world, corrupt the loan process? Hasn't the Grameen Bank been revealed to
be a pleasant cover for getting free money to loan, while pocketing the spread? Aren't the loan collection
enforcment methods kind of bizarre?"
"... I find your lack of faith disturbing."
Posted by: Person at May 3, 2007 2:50:56 PM
and Morgan Stanley is hawking the first microcredit CLO today. Any help with recovery rates on reposessed water buffalo?
Posted by: mkl at May 3, 2007 4:54:27 PM
Of course, maybe myspace really will provide the next financial revolution. You ask for investment dollars from all your mypsace friends for a venture, work out the contracts with a bunch of emails (which are enforceable legal documents), and off you go.
Posted by: Keith at May 3, 2007 5:05:46 PM
Good point, Keith. For the philosophers: if you loan a MySpace friend some money, and you never see them
again, did you get your money's worth? ;-)
Posted by: Person at May 3, 2007 5:30:24 PM
Portman: very beautiful, very smart, but a pretty crummy actress.....
"I have seen that ending poverty is possible - it is just a mouse click away," said Ms Portman
...apparently, an irrationally optimistic person as well.
Posted by: tommy at May 3, 2007 6:32:14 PM
Econotarian has a great point and I'll throw my hat into his side of the ring. I would say that, yes, micro-credit is not what these countries need, it's really micro-'finance'.
Micro credit implies small loans to help entrepreneurs start or expand small businesses. Read any of Yunus' books or check out the video of his speech at MIT and you'll see what a powerful impact these loans can actually have. Yeah, the rates aren't normal by an American stretch of the imagination, but they are miles below what the local loan sharks would be charging these folks.
Micro finance, on the other hand, encompasses the other aspects of finance that developed nations take for granted: insurance, savings accounts, CDs, money market accounts, etc on up the ladder. Micro credit is, I believe, the first rung of the ladder for many of these folks. Better capitalist training, protection of private property rights, formal title to their businesses and micro 'finance' are the next rungs up that will help these people climb out of poverty.
Incidentally, if anyone is interested in seeing this in action in America and in the world, there are two wonderful sites to check out. One, www.prosper.com, allows you to bid on loans from regular folks. I've loaned out $500 in $50 increments at rates ranging from 8.5% to 15% in the last 6 months and it's a neat site. Kiva.org is another one that does just about the same thing, but focuses on entrepreneurs in developing countries. Haven't tried it yet myself, but I plan on getting to that one as well.
For all of you actual economists out there, prosper also has a wicked data set that you can dump into any type of db or excel spreadsheet to see lending/borrowing/default rates, etc. Just about any metric you can think of. I could definitely see someone defending a thesis on their business model alone.
Posted by: Alex Ambroz at May 3, 2007 10:55:53 PM
Natalie is a very good actress.
I first saw her in The Professional with Jan Reno and Gary Oldman.
She did an excellent job in that movie.
Posted by: Dave Barnes at May 4, 2007 12:10:21 AM
Overly optimistic, but I'm impressed that an actor even knows what microfinance is.
She's almost the perfect girl, except for the fact that she's Harvard and therefore the enemy ;)
Posted by: Robert at May 4, 2007 1:27:47 AM
I've loaned money via Kiva.com and the process is simple if you have a paypal account. I think the idea is brilliant - especially if you're concerned about sustainability and more efficient asset allocation.
Here's my full thoughts on it from a couple month back:
http://slowgroove.blogspot.com/2007/03/kivaorg-microfinancing.html
Posted by: Shane Milburn at May 4, 2007 1:47:52 AM
Tyler, the mere fact that you linked to a photo (and what a lovely one it is) that took time for you and takes time for us (guys and a few gals) says that she's got our attention. Now what? We remove our attention from something "less worthy" (marketing 101); if MF gets more eyeballs, there will be more competition and entry, and things should improve. I'm far more worried about MF foundations just shoveling money bc it's the fashionable thing to do. Bottom line: this is good for MF; other, now-more-neglected areas will have to step up their game. OTOH, a mouse click isn't going to solve anything *directly* (It's the overall attention) and I'd hate to compete with Bono.
oh -- she was great in V for Vendetta...
Posted by: David Zetland at May 4, 2007 11:33:55 AM
Natalie Portman is the fifth element.
Posted by: Uri at May 4, 2007 5:21:28 PM
Natalie Portman: bad actress
Microfinance: great idea
America: officially has the hots for Jewish chicks
Posted by: Mr. Noah at May 4, 2007 6:57:33 PM
[Read any of Yunus' books or check out the video of his speech at MIT and you'll see what a powerful impact these loans can actually have.]
although true cynics often cannot help pointing out that Bangladesh remains one of the poorest countries on Earth.
Posted by: dsquared at May 7, 2007 7:59:25 AM
