What is more important for the "real" US economy? Sovereign wealth funds, hedge funds, other funds, banks or "Microfinance" of the Grameen type, that has recently arrived in the US, in Queens, NY?
Microcredit is a financial innovation which originated in Bangladesh and it is the provision of very small loans to the unemployed, to poor entrepreneurs and to other people living in poverty whose alternative sources of funding are pawn shops and loan sharks.
Microcredit is increasingly gaining credibility in the mainstream finance industry and many traditional large finance organizations are contemplating microcredit projects as a source of future growth! The United Nations had declared 2005 the International Year of Microcredit
Microcredit is a part of "Microfinance", the provision of financial services to low-income clients, including the self-employed, while it has also come to refer to a "movement" that envisions “a world in which as many poor and near-poor households as possible have permanent access to an appropriate range of high quality financial services, including not just credit but also savings, insurance, and fund transfers.
It is associated with Muhammad Yunus, a Bangladeshi banker and economist, founder of the Grameen Bank, both (Yunus and Grameen Bank) being the joint winners of the 2006 Nobel Peace Prize!
IMO, Microfinance is taking finance and capitalism back to its healthy "roots" or "cornerstones".
Food for thought: Compare and (what is more important) contrast, Microfinance and the infamous subprimes!
As I have noted in the past, IMO, capitalism "means" owning a business rather than a house!
Whereas the industrial revolution based capitalism needs large funds to set up a business and it was based on high fixed costs (thus the need for state aid), Services, and the US economy is about 75% Services these days, do not normally needs large funds. Thus, IMO, microfinance seems much more relevant to the real US economy as well as the fundamentals of Capitalism and Free "Marketism".
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