It has been reported that in in Italy, banks have literally stopped lending to businesses. They have always been rather tight in extending credit to businesses, but now that traditional bank lending almost does not exist, businesses are looking for lenders.

The mafia is always willing to help and "lend" a hand (or an arm and a leg).

It seems that with the hard times, and the tremendous paperwork it takes to get or even apply for a loan these days, the mafia lending is doing a brisk businesses, with a lot less paperwork or qualifying.

Maybe they need a few more lending offices for the Italian mafia in the USA, with all that easy lending policy and lack of paperwork, business should flourish now!

Their lending works like the payday lending offices we now see becoming so popular here in the USA.

The borrower, a business, writes a check for the total amount to be paid back in 30 days, with the service fee or interest, and signs the check.

In the meantime the business gets a cash advance less the interest or service fee.

What a great way to do paperwork, no UCC forms, no complicated collateral. The lender simply gets your business if you do not pay when payment is due.

To date, approximately 180,000 Italian businesses are clients, and the rate is easy to understand-10% a month.

Everyone can qualify, office workers, factory workers, owners of small and large businesses.

And it is reported that the lender is easy to get along with. The lender like any lender prefers to get the money, rather than to take over your business. But, like all lenders, that is the last resort...and more an more businesses in Italy are now owned by "unknown" owners.

There are other matters that seem to go along with the lenders....the linen service even if you do not need a linen service, maybe a jukebox in your office, at an inflated rate, and there is also "insurance" to make sure that your business does not have an unexpected fire or vandalism. These other services are also apparently with minimal paperwork, and will not require looking at your FICO score.

Business has always found a way to get loans, no matter what the financial "crisis", and the folks in Italy may be showing us the way to do it in the USA.

Now think about the USA, the government has muscled its way into AIG, CITI BANK, BANK AMERICA and other big financial businesses and now also GM, Chrysler, etc.,, and it is using your tax money, to buy into the business without its owners (stockholders' consent)! Is this our home grown Mafia ? many would agree that it is our version of a new unwanted "silent" partner who controls how much you get paid, what events you attend and the intrest you will pay.

The only difference is that they, so far in the USA version, will not break your leg or arm if you fail to pay, however they will use your money to lend, and you will get nothing for it!

At least in Italy, the mafia does not use your money, to lend to deadbeats who will not pay!

It is a true free market lender who does not ask to be bailed out by taxpayers.

By the way, that reminds me of the "mafia" interest rates we saw under President Jimmy Carter, as the prime rate alone shot up to 22% when money got tight and businesses could not get loans.

Again the government got involved...are we getting a feeling of "deja vu" again?

I really hope that we in the USA will not have to turn to the mafia for business lending.


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