No Day But Today
- Mar 25, 2010
- Reaction score
- Political Leaning
- Libertarian - Right
Do you agree with this statement - "The more money you borrow, the wealthier you are."
prongman? That is truly awesome :lol: (seriously, I like prongman better than progman, its somehow more manly)No, borrowing money does not reflect wealth - it reflects your deficit and what you do not have to begin with.
If you borrow to try to increase profits (like prongman said) then you're gambling and you're only wealthy *later* if your debted investment pays off. . . and your wealth is only calculated *after* your debt is gone - so debt might be a way to gain profits but debt will be deducted from those profit-margins until your debt and interest in paid off.
Nah, now I really like the idea of being megaprongman.LOL - sans "N" Progman.
Agreed, but as long as its yours, its wealth.But - investing is risky business. . . its' more akin to gambling. I would only count profit-post-debt if the debt is truly erased, leaving the profit behind.
Well a debt is a perceived value or worth by the institution making the investment on whatever it might be. Since the bank really does make the loan out of thin air the value of the loan is determined by a subjective value of the borrower. Clearly the loaner believes the individual making the loan is able to pay back more then they borrowed. The real asset is obviously the borrower and their promise to pay it back. So debt may be a reflection of financial value of said thing.If you have to pay it back to someone - it's not wealth.
There are only a few instances when debt will lead to wealth.
Every little helps.prongman? That is truly awesome :lol: (seriously, I like prongman better than progman, its somehow more manly)
Also, it depends on the type of investment. Some can be sold off later for a profit while others can generate profits in a way that is continually paid out.
Depends what you're spending the money on, and why. If you're borrowing money for something worthwhile (e.g. college education, a cheap car to get to work, starting a business, investments that pay a higher interest rate than your cost of capital) then yes, it will make you wealthier. If you're borrowing money for consumer goods (e.g. a trip to the Bahamas, a brand new car, a big-screen television), then borrowing money will financially ruin you eventually.
Well it depends on what kind of money system your talking about.OK.. serious business here... If no one had any debt no one would have any money.
Where do you think money comes from? Some magical thing that exists on it’s own? Poof.. suddenly people just have money.
hrm.. interest makes it impossible to pay off more then you borrowed.Well it depends on what kind of money system your talking about.
With fractional reserve lending removed, yea our currency would deflate heavily.
But there would still be money, less of it and more valuable.