Taibbi: Con Of The Week – Greensill Capital
For an explanation of the “Con of the Week” feature, click here.
When the face of a traditionally low-margin business starts collecting private jets, it’s time to head for the exits
Scrooge never painted out Old Marley’s name. There it stood, years afterwards, above the warehouse door: Scrooge and Marley…
Oh! but he was a tight-fisted hand at the grindstone, Scrooge! a squeezing, wrenching, grasping, scraping, clutching, covetous old sinner! Hard and sharp as flint, from which no steel had ever struck out generous fire; secret, and self-contained, and solitary as an oyster.
Charles Dickens never quite explained the business of Scrooge and Marley in A Christmas Carol. We knew old Ebeneezer was familiar with the fellows at the “‘Change” (the stock exchange), spent time in a “counting-house,” and was owed money all over town. One of the few things that made him happy was the passage of time, for debts to him — marked “three days after sight of this First of Exchange pay to Mr. Ebenezer Scrooge” — would become mere worthless securities, “if there were no days to count by.”
One theory is “Scrooge and Marley” were engaged in an age-old business called “supply chain financing.” The concept is simple. A supplier sells an order to a buyer. Rather than wait for the buyer to pay, the supplier accepts immediate payment with a slight discount from the supply chain financier, who in turn later collects the full amount from the buyer.
Scrooge once would have been a perfect fit as a leading man for Supply Chain Financing. It’s “blocking and tackling” finance work, a simple, unsexy living, best left in the hands of one who holds pennies in a vice-grip.
If you’re not the type to bring a book of debts home for pleasure-reading, you wouldn’t prosper in this profession.
That was consensus, until Lex Greensill came along.
Lex Greensill testifying before the British Treasury Committee
Sat, 05/22/2021 – 08:10