Re: increasing savings rate vs using your income as an asset?
Posted: Wed Dec 13, 2023 7:34 pm
You are correct, one does not need to do those things. An AI algorithm will likely be happy to make a loan to someone with a high default risk if it can 1)assemble said loan into a portfolio of other loans 2) Charge a high enough interest rate 3) Package these loans into a product to sell to a person/institution chasing yield.7Wannabe5 wrote: ↑Wed Dec 13, 2023 10:06 amIt's not the 1940s. You don't have to type up a 10 page business plan, put on a suit, and meet with Mr. Potter sitting behind his desk at the Bank & Trust. It's entirely possible that an AI might offer somebody with $15k annual income a loan simply on the basis of detecting that he regularly posts on this forum
But, that still leaves the OP in debt paying a high interest rate. That places a high hurdle to jump over to reach profitability. Better to pursue the micro businesses you mentioned as they can all be boot strapped from existing cash flows. However, I don't know how resilient it is to have a small number of micro-businesses with low barriers to entry that offer services that are highly discretionary. I imagine dog walking, math worksheets, and organic lawn care could dry up very quickly when people tightened their belts.