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July 24, 2001
Creative Teenagers Barter For College Education
Last year two New Jersey teenagers, 18-year-old Chris Barrett and his childhood pal Luke McCabe, pitched themselves as "spokesguys" for any corporation willing to fund their higher education.
Today Barrett is at Pepperdine University's sunny Malibu (CA) campus while McCabe is a freshman at USC (University of Southern California)...thanks to First USA Bank.
The bank and the students claim this is a first for such a bartered sponsorship, where, between classes, the two will wear clothing with First USA Bank logos and speak with students about establishing credit and managing their money.
In exchange for the students providing such services, the mammoth credit card issuer has agreed to pick up $40,000 for one year's tuition, room, board, and student fees.
California schools were their first choices because, the
two guys claim, being 3,000 miles away from home gives
them a different perspective on life. The teenagers came
up with the novel idea last summer when they were interns
for a small independent media relations firm near their
Vendor Financing A Two-Edged Sword
Telecommunications equipment providers who extended generous financing terms for easy sales to promising young companies are finding out there is another side to the story.
Because of the problems incurred, the need to scrutinize borrowers more closely, as well as adopting better risk-management techniques, may well be the way of the future for these providers. (Even though vendor finance loans are usually initiated by the sales force.)
But that doesn't solve the immediate problem, which is an impact on the vendors' financial performance, since loan losses in excess of reserves are charged to current earnings.
Wall Street Journal estimates there is at least $25.6
billion worth of loans (at risk) on the books of nine
global telecom giants.
Here And There. . .
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