Thursday, September 12, 2013

Pawn Your Louis Vuitton

A handbag that didn't get back to its owner

While the pawn business has been going great guns in the US, it is now catching on in Hong Kong. For eons the pawn business has been a way for cash strapped Americans to get a short term loan.  It has become so popular during the economic downturn that it has spawned reality television shows about the business. You can watch people bring in unusual item to a Vegas pawn shop in Pawn Stars or watch the bickering and name calling from customers in Hardcore Pawn.


Lady Finance sells handbags second hand
Yes it is apparent that I watch these types of shows. The popularity of short term loans with unusual collateral has now moved to Asia. The Asian population is becoming more affluent and as such may suffer from time to time with cash flow problems. Welcome to American consumerism! What is unique about the Asian pawn business is legitimate loan companies that usually give out mortgages are now dealing in high end handbags. That’s right; you can pawn your Louis Vuitton.


Handbag inspection and appraisal
Apparently they give the customer fifty percent of the value of the handbag on loan for four months. If they don’t pay off the loan in that time frame with interest then the bag gets sent to one of their second hand stores and is sold to cover the loan. What is interesting is counterfeits that are a problem everywhere are also a problem in Asia. People have a counterfeit and they don’t even know it. The loan brokers spare the customer’s feeling and simply refuses the loan without telling them the real reason. They make up an explanation for refusing the loan so the customer never knows that their bag is a fake.


The guys from Pawn Stars on the History channel
While it’s really nice of them to not tell the customer they’re toting around a fake that isn’t how we would do it in the US. It must be a cultural issue as every time I’ve seen a pawn show where someone brings in a fake they are told it is a fake and why. Some people are disappointed other continue to belief it is real and the pawn broker is lying. Hiding someone from the truth isn’t always the best solution as they will continue to take the item around asking for a loan. Wouldn’t it be better to tell them the truth so they can find something else to pawn? That’s how we do it in the US.
The bickering Golds of Hardcore Pawn in Detroit

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