Its a big problem to guarantee profits like that, because you remove the incentive for the lender to care about the business he's investing in. It doesn't matter, just give money to anyone since profit is already guaranteed.
He punished those companies that had cooked the books. In that sense its the government collecting debt owed to it. Ofc it should've been immediately resold to other private investors.
Amazing lecture
Really shows the nuances of industrial progress in Russia
Its a big problem to guarantee profits like that, because you remove the incentive for the lender to care about the business he's investing in. It doesn't matter, just give money to anyone since profit is already guaranteed.
So Bunge, who believed in market forces, nationalized railways. Okay.
He punished those companies that had cooked the books. In that sense its the government collecting debt owed to it. Ofc it should've been immediately resold to other private investors.