This update fixes/enhances a couple of front end issues.

• Renamed “Defaulted - Repurchased” to “Defaulted - NAT” (NAT = New Agency Test Loans). These loans were previously picked up through an automated script, however Prosper has now recategorized them as Defaulted. Per user request, we have hardcoded these loans as “Defaulted - NAT”. (this in no way affects roi calculations)
• Fixed a bug on the loan map page where Louisiana wasn’t showing up correctly.
• Restructuring backend/infrastructure. (You won’t notice anything different on the front end)

It’s always interesting how the odds are always stacked against the small investor.

Consider the following scenarios: (oversimplified, but it’s to make a point)

- Family buys a home speculating that the price would increase. They put 20% down on a 500k house and get the other 80% as a mortgage. (effectively they are buying the house on margin). If the price of the house goes up 20% they effectively made 100% on their initial investment of 20% down. If the price of the house goes down 20% they have effectively lost their initial investment. What if they can’t afford the mortgage? They go into foreclosure and the house is taken from them.

Now if your a big financial institution the rules should be the same right?

- Financial institution speculates the real estate market would boom. They use 40x leverage to bet on the housing boom. When the market is booming they are raking in the money. However when the market turns south and they can’t afford to pay up the government steps in to give them a helping hand. Uncle Sam is willing to go so far as to extend loans funded by taxpayer money to private corporations. When this doesn’t work the government outright intervenes or promises to step in with taxpayer money to bail them out. (Fannie, Freddie, Bear Stearns)

I am perfectly fine with people taking risks and reaping in the rewards. However there is a fundamental problem with our capitalist markets when rewards attained from risky bets are lining the pockets of a select few and losses from the bad bets are being shouldered by the taxpayer. Who in their right minds wouldn’t bet with other people’s money (OPM) when the risk/reward ratio is so skewed?

On my current trip to China I noticed that inflation is running rampant here, in fact it’s a lot worse here then in the US. Wages, food prices, etc. are all going up.

For instance, a bag of cement which was selling for 12RMB (about $1.75) last year is now selling for 36RMB currently. (The earthquake in May caused prices to sky rocket) Worker wages have been increasing at a 10% clip yearly yet it’s seems barely enough.

The government has been trying to dampen inflationary pressures by regulating the cost of energy which seems futile. A taxi driver in Beijing told me the government is currently subsidizing them over 1000RMB/month in gas rebates to prevent fare increases to customers. However he thinks this will soon end after the Olympics when subsidies cease and fare increases become inevitable.

I’m living in the US why would this matter? If the cost of production starts going up dramatically in China, then all the cheap ‘Made in China’ goods we’re used to are inevitably going to increase in price.

We just fixed a slew of bugs including a particularly irritating one that affected account creation and changing your account information. Sorry about that. If you notice any more bugs, please help us out and report them to . Thanks for notifying us of this issue. (Asparagirl, Jess)