Mao Yushi: Usury Is Good For The Poor.

Economics studies how wealth can be produced most efficiently, making the whole society richer.

Under the condition that human rights are guaranteed, free exchange can improve the allocation of resources and increase the output of wealth.

But such an environment is only provided.

There are many ways to get rich. Duan Shaoyi introduced many different methods in his book.

But they all share a common feature, which is to improve the efficiency of resource allocation.

Economists often say that economics is the study of resource allocation.

In this book, we can see a lot of examples of improving the efficiency of resource allocation.

How does a country get rich? We say that the allocation of resources has been improved.

How to improve it? Look at the answer to this book.

The prosperity of a country is not an empty word, it is manifested by many concrete things.

Without the efforts of every citizen, the prosperity of the country is actually empty.

This has experienced the experience of people in the planned economy era.

At that time, the interest of the country was very loud, but the people were so poor that they could not even afford to eat.

Now the interests of the state are few and the interests of the individual have been recognized.

The result is that the state and the people have become richer.

So

No one will object to improving the efficiency of resource allocation.

However, there is no dispute over specific events.

For example, there is a big controversy over the interest rate of private lending.

Funds should be allocated to projects that are of the highest benefit, that is, those that can pay the highest interest rates.

Like auctions, goods should be sold to the highest bidder.

No one said that goods should be sold to low bidder.

However, the interest rate of private lending has aroused great controversy. It is considered that usury is unethical and usury is exploitation.

This view came from Shakespeare or earlier.

Savon's masterpiece, the merchant of Venice, means how usury can harm people.

Governments around the world also have no objection to usury.

Because the government must have a face of justice.

If the government supports usury, it will not become a bad guy.

Nor do we economists.

A major event in recent years has been the world bank's research on microfinance for poverty alleviation, and for the first time affirmed the necessity of high interest rates.

This is an unprecedented feat in human history, breaking the habit of thousands of years.

Although real economists would agree that interest rates fluctuate with the market, that is, they should not interfere with usury, but economists' suggestions are usually not adopted by authorities. Especially, the government is unwilling to recognize the legality of usury in order to maintain its face of justice.

Now the authority of the world bank has made a strong voice - usury is good for the poor.

Governments are beginning to change their attitude towards usury.

Our government also relaxed control over usury. It stipulates that private lending, which is not higher than four times the normal lending rate of state-owned banks, is protected by law. It is only said that the interest rate above four times the normal lending rate of state-owned banks is not protected by law. However, there is no law which stipulates that private lending is more than four times higher than the normal loan interest rate of state-owned banks.

In fact, too high interest rates are not good, but the solution is not to prohibit, but to encourage more funds to enter the industry, and when the supply of funds continues to increase, interest rates will naturally drop.

If it is forbidden to make more money to enter the private lending market, interest rates will not fall.

So the world bank does not set any interest rate restrictions on small loans for poverty alleviation.

From the experience of other countries, small loan funds in rural areas are still very limited, so interest rates are limited.

Because the cost of rural micro credit is very high, although there is high interest rate, but there is no high profit, it still can not attract enough funds to enter.

Besides, the interest rate of the same money should be different because of different loan conditions.

Interest rate is the price of capital, and the quality of funds is different.

Do not mortgage, do not guarantee, no additional costs (gifts, gifts), can quickly get the money, this is a high quality of funds, of course, the interest rate can be higher.

Most people do not know the difference between capital and quality. They only know that high interest rates are not good. They do not know that high quality funds should be high priced.

The author of this book has accumulated a lot of experience in improving the allocation of resources, especially in the areas of private lending, investment, financing and entrepreneurship.

He not only paid attention to the efficiency of resource allocation in theory, but also made achievements in practice.

And it is very valuable to impart his experience to others unreservedly.

This book is a summary of his improvement in resource allocation.

Finally, I think the meaning of life is to enjoy life and help others enjoy life.

This is my belief, so money should be subordinated to happiness.

Money that does not increase happiness for others and others is not worth earning.

Making money is not the end, but the purpose is to be happy.

Of course, making money helps happiness, so we advocate making money.

But not every piece of money can bring happiness, so pay special attention.

Pursuing happiness is your goal, but knowing that others are also pursuing happiness.

So we must make others happy when we are happy.

The most dangerous thing is to pursue happiness by making others miserable.

Let others be happy and make themselves happy. They should be placed in the same position. This is a symbol of human morality and also a goal of life.

Not only in terms of money, but also in human interaction.

I would like to respect others and let others feel happy in their interactions with them. I would like to share with the author and readers of this book.