Wow -- Capitalism works

"I've got to be better in what I offer. I've got to be that much better in the service I provide my customers, or they'll go to my competition."

I'm in Honduras for the week with John Ledford, our 2008 Socially Responsible Advisor of the Year. We're here to make a donation in John's name to the Adelante Foundation, an organization that makes micro-loans to poor women in rural areas (usually about $100). The women can then buy toothpaste, combs, brushes and other toiletries to resell for a profit in their villages. It's a way to build a business at the grassroots level and empower women to lift themselves — and their families — out of poverty. And it's overwhelmingly successful. Muhammad Yunus, the Bangladeshi economist and founder of Grameen Bank, won the Nobel Prize for developing the concept of micro-loans in 2006. The micro-loan repayment rate is 99 percent (try to find a repayment like that in today's sub-prime mortgage environment).

The above quote comes from one of the loan recipients. And despite all we hear about Bear Stearns and bank scandals and sub-prime exposure and new regulation, it gives me faith in the power of free markets, and dare I say, capitalism. At this most basic level — the level of survival for her and her children — this woman (no, this entrepreneur) understands the basic tenets of our capitalist system. With all of our technology and MBAs, it would be nice to have the same sense of purpose and clear-headedness.