Thursday, 24 January 2013

Muhammad Yunus - too naive, and now too implicated, to recognize 'Multi-Level Marketing' as a financial fairy story

Alex Counts,  president, CEO and founder of Grameen Foundation. 

I was recently informed by a naive young employee of Grameen America that '99% of all loans are repaid by Grameen's American borrowers.'  However, evidence from Grameen Foundation would seem to prove quite conclusively that this anecdotal claim must be a financial fairy story. The same evidence also proves that, as recently as 2011, the naive head of Grameen Foundation, Alex Counts, did not have the slightest idea of the danger which the 'MLM income opportunity' lie poses not just to the poor, but to the very concept of micro-finance.

The following 'Herbalife' propaganda has been cut and pasted from the Grameen Foundation's own Website:

'Grameen America today has 7,000 clients, almost half of whom are served by its original branch in Queens – a modest one-room space in a neighborhood where one can find store signboards with writing in English, Spanish, Hindi, Bengali, Arabic and Korean.  The scale of operations outpaces virtually every other MFI in the United States.  It was exciting to sit in their office one recent afternoon and see how smoothly everything was proceeding – half-dozen center managers had each attended between three and five meetings, as they do every weekday, and by 1 p.m. the office was filling up with clients who were coming for their loans, which are renewed every six months 
if prior loans are paid on time (as almost all are).

Alex Counts attends a Grameen America center meeting in Jackson Heights, NY.  (Photo by   H.A. Shah Newaz.)
Alex Counts (unwittingly) chatting with 8 of the many poor, Latino, immigrant women who have been deceived into thieving from Grameen America on behalf of the 'Herbalife' racketeers.

It turns out that most centers are populated by people from the same Latin American country – all except one woman in the center I visited was from Mexico (the lone exception was from Ecuador).  Others are dominated by Dominicans or Guatemalans, while some are fairly mixed.  Most of the businesses are related to food (pushcart, catering, etc.), clothing and other retail (such as flowers).  About eight of the women in the center I visited – which had about 30 members attending – were involved in Herbalife, a kind of nutrition program sold through a network of women who are organized like Avon ladies.'

Alex Counts,  president, CEO and founder of Grameen Foundation.

(It is also interesting to note that Mr. Counts also repeated the financial fairy story that almost all loans are paid on time by Grameen's American borrowers).

In the light of recent events concerning Bill Ackman, some common-sense questions might now finally be put to the officers of Grameen America by federal law enforcement agents:
  • Exactly how much cash has been lent to poor borrowers which they have then given to 'Herbalife?'
  • Exactly what percentage of these 'Herbalife'-related loans have been repaid?

Frighteningly, the actual inventor of micro credit, Professor Muhammad Yunus, has appeared as key-note speaker at a Congress of the so-called 'World Federation of Direct Selling Associations.' Apparently, Prof. Yunus was also too naive to know that the majority of so-called 'Direct Selling' companies, like'Herbalife' have been the corporate fronts for an insidious form of cultic racketeering which enslaves the poor by offering them the illusion of future financial freedom

Readers of this Blog should also remember that 'Herbalife' racketeers have attempted to obstruct justice on CNBC, and elsewhere, by modifying their previous financial fairy story - claiming that:

Bill Ackman's presentation (20th December 2012) and the Pershing Square Capital report, were based on a simple error - i.e. most of the people who have been described as 'Herbalife Distributors' aren't 'Distributors' at all, they are just 'discount customers.' 

Obviously, this Orwellian nonsense doesn't hold water in respect of all the poor people who have borrowed from micro-finance institutions allegedly to start so-called 'Herbalife Distributorships.' 

What sort of poor, Latino,  immigrant woman (living hand-to-mouth in a tough NY neighborhood) borrows $1500 from a micro-finance institution to buy piles of non-essential products that (even with the discount) cost several times as much as equivalent, non-essential products in a discount store?

David Brear (copyright 2013)

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