You purchased a shipping container full of superhero-themed underwear, which is currently en route from China. You spent $2 million for the undies, which you plan to sell to retail stores. While the boat with the underwear on it drifts somewhere in the Pacific, you get a call from a competitor. They are willing to pay you $2.5 million for the incoming shipment. You could book a $500,000 profit without having to do any sales. You say, "sure."
Luckily, you have a negotiable bill of lading. It's the official document for the shipment, detailing all the pertinent information about the cargo, including who is supposed to receive it once it arrives in the U.S.
The "negotiable" part means that whoever holds the official bill of lading can receive the shipment. It isn't a specified person or entity. Whoever has the document gets the undies. So you can sell your bill of lading to your competitor and just let them receive it when it comes. You don't have to receive the shipment yourself and then somehow transport the product to the purchaser. It's just a matter of selling them the bill of lading.
The negotiable bill of lading stands in contrast to a non-negotiable bill of lading. That kind of document lists specifically who can receive a shipment. The shipper cannot give the cargo over to anyone other than the party listed in the bill of lading.
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Finance: What is a Bearer Bond, or Beare...20 Views
Finance a la shmoop... what is a bearer bond or bearer stock alright you know
that saying possession is nine-tenths of the law
right well that's how bearer bonds and stocks work if you have the paper [Man presenting a bond]
representing the bond or stock aka the bond or stock certificate itself in your
hot little hands or wallet well then you own the bond or stock whether you stole
it or bought it or you know 3D printed it...In bearer bonds and
stocks there's no record or tracing of who bought or owned the bond or stock
sort of the opposite of how Bitcoin works and because of this non tracing [Money in a laundry machine]
and the ease with which money could be laundered for our kindly loving
terrorist friends bearer bonds and stocks are not very common today because
investors simply don't like the idea that their precious assets can be stolen [Thief running from police with money]
and then used to you know match plaid with stripes to counter this anonymity
most securities are in fact registered meaning that ownership is filed
officially with a brokerage or an issuer ie the company itself so that money can [A tracker appears]
be tracked and well taxed all over the world and note that one way bearer bonds
or stocks are dealt with in the fashion realm is to you know simply get rid of
the E don't look....[Man walking on a catwalk with no clothes]
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