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RE: Dear fundamentalist dipshits that think charging interest for loans is immoral, fuck you.
Are Neoxian's interests really that complicated?
The Bank of Neoxian shall loan the sum of 180 steem to tegoshei. She promises to repay 202 steem. She shall pay 20.2 steem per month until 202 steem is reached. The first payment shall be Feb. 2nd, 2019.
Ehmmm, looks pretty simple to me. 22 Steem fee + original amount, all paid over the course of 10 months.
I completely agree with you. What is shown isn't actually interest, although he may have calculated it as interest, and call it that, but is a stated fee.
I was not addressing @neoxian's business arrangements particularly, but interest generally. While his business is intimately known to him, it is a complete mystery to me, and I did not have any specific knowledge of any deal he has ever made to refer to in my comments, nor did he discuss any specifically.
I hope I have expressed that I feel interest is used to scam people who don't grasp what it will cost them, and if his arrangements are as straightforward as your description - and I do not doubt you are being truthful - then I do not lay any such accusation at his feet.
What I do think is immoral is telling someone they can borrow $100k at 10% interest, and letting them think they will pay back 10% of 100k. Because compound interest doesn't work like that, and most folks have no idea what they are actually paying for their mortgage in dollar amount. Usually it's multiple times the principal they borrowed, and that's just plain scammy.
Thanks!
Check out all of his previous posts. Most of his deals are public.
And about your last paragraph, what? I've never seen that. I should look out for that. Care to show me more concrete examples? I'm not a math junkie but I can understand from example (I understood nothing about your mathematical description of interest in your previous post).
I don't want to make a pest of myself, so don't generally harass folks who don't cause trouble. @neoxian does business, and I have never heard anyone accuse him of doing so in anything other than honorable manner. I only commented here to try to defuse the flags, which seems to have come about.
As to mortgages, or any longterm interest payments, you can find online amortization tables which will do the math for you. A search will be fruitful, as many real estate portals offer such tools to help market their inventories.
A simple tl;dr is that for a short term loan, say only one day, there's no compounding of interest (charging interest on the interest). If you borrow $100k for one day at 1% interest, the next day you owe $101k. Over a longer period of time, more than a month or two, the interest that accrues on the principal is added to the principal amount, and interest is also charged on that (compounding). If you borrow $100k at 10% for 30 years to buy a home, and make the minimum payments, you'll end up paying much more than $110k back, because of compounding, more like $300k (I didn't do the math or even look up an amortization table, so don't hate me if I'm off by less than an order of magnitude. I'm but explaining the principle).
There are also a great many other mechanisms that are often employed to make it even more complex and opaque to borrowers, such as compounding daily, or variably, and variable interest rates that fluctuate (usually based on something called the Prime Rate - if you want to know what that is, you can search for more information), and many lenders also add various fees, such as loan origination fees. The end result is to often hopelessly confuse borrowers, who just want to buy a house at a monthly payment they can actually pay every month. Adjustable Rate Mortgages (ARMs) were a huge contributing factor in the 2008 meltdown, and why a lot of people lost their homes - to scumbag banksters.
Hope that helps to clarify the issue for you.
No more a pest than an awesomely lame professor making sure we knowledge up. Thanks.
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