Yesterday I was privileged to attend a high level Microfinance event, co-chaired by Howard Finklestein, a very inspiring lawyer who now focuses on Microfinance. Here are some excerpts from his talk, which will make you - next time you have money to invest - go straight to www.microplace.com and loan, for a modest profit, to third world entrepreneurs. Beats losing 40% of your portfolio on subprime loans.... The double standard is astonishingly ironic of course. Third world borrowers of amounts like $100 are more heavily vetted and monitored than folks borrowing a few $100K in the United States, and those imprudent LENDERS brought our whole world economy down. Here are Howard's reflections:
GreenMicrofinance was out in force at the 3rd Microfinance East Conference in NYC, co-chaired by the New York Microfinance Club leaders Howard Finklestein and Bhakti Mirchandam. The black cloud of the "financial situation", a condition that was described in numerous ways over the course of the day's many dynamic and informative speakers, was never far from anyone's consciousness. Microfinance has been spared the worst, which is pretty good news.
Howard shared some amazing numbers to kick the event off.
30% of last year's conference speakers have switched jobs.
Of all the money invested in MIV (Microfinance Investment Vehicles) in the last 7 years since their inceptions, the amount of money lost is $0.00.
The amount left in Madoff investors' accounts: $0.00.
The approximate value of stocks like GM: $.10 on the dollar.
The value of MIV investments: 100% of capital + interest.
The number of US pension funds invested in MIVs - 2.
The number of US Foundation Endowments invested MIV's - 1.
Howard looked around the room and gave a sort of benediction: there are so many smart, passionate, capable people here, all forced to spend their time chasing after investment. Investors should be chasing them! Greed triumphed over prudence, and EVERYONE LOST, RICH AND POOR.
By the way, Howard pointed out that Kiva, which has been quite the success, really sends a wrong message. Microfinance can be a profitable investment. It doesn't need to be charity, and we will never meet the credit needs of the world's billions of poor by donations alone.
So let's hope 2009 is different!