So I’m sitting here reading my copy of The Guardian Weekly, right? The actual article the paper is turned to right now is “How an Australian became central Europe’s used car king.” The story focuses on Anthony Denny, an Australian with Czech roots who went back to his dad’s home country to start a used car business called AAA Auto.
Nothing wrong with that, right?
Okay, so I’m reading the article: Dude sold used cars in Australia, did the stock market, built houses and so on. He moved to Cali and started exporting cars.
Okay, great.
But here’s where I just don’t get how business works. In the middle of the report is this nugget:
The business was started with $100,000 he had to borrow from a bank following the loss of his original $100,000 investment, when dishonest business partners refused to pay him for cars they had sold.
Emphasis mine.
Now, would someone explain to me how in the hizell can someone get a $100,000 bank loan after LOSING $100,000 in a bad business deal? Granted, the dude has made up for it ten times over, but still, I’m sure if I walked into a bank and said “I’ve just lost $100,000 dollars, but can you give me another $100,000 so I can sell used cars in the Czech Republic” folks would start sizing me up for a straitjacket.
Could someone please help me understand this?
Comments (3)
Possibly he owned assets? Sometimes loans are given to experienced businessmen who have a great deal of assets… Not saying it is fair…
But if he had to borrow money to cover an original investment, doesn’t that mean his assets aren’t worth even that? If you have to borrow money to cover a loss, that means you couldn’t afford to make the investment doesn’t it?
I’m not sure if I’m being clear though.
@Rashunda
Well you can only look at the bad mortgages that they made here in the States…
Foreclosures are out of control in some parts. Most of these people should not received loans in the first place.