Ah...someone who knows Capital Structure.
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Rising Debt May Cause Sun to Set on U.S. Economy: Chart of Day
- Thread starter ByLoSellHi
- Start date
Quote from kxvid:
The guys right, to some extent. If you have a business that has higher return of assets than after tax borrowing costs you should borrow more. That is assuming you believe you will be able to maintain that return on assets.
Households do not operate like businesses. An increase in household debt will not result in an increase in income generated. Household debt is non self liquidating, business debt is self liquidating. To say we need more household debt is ridiculous.
It is also debatable if there should be more business debt EVEN if business return on assets are higher than after tax borrowing costs. This is because nobody knows if those returns are sustainable. ROA's were artificially high due to the doubling in private credit market debt over the past 10 years.
You have to also include the fact that the U.S. is like General Motors (at least, how it used to be), given the demographic segmentation, with 1 active worker soon to support 3 retirees.
That inverted pyramid will ensure that taxes for things such as social security, medicare, etc., will demand a greater % of the working aged population's paychecks than ever before...
Quote from kxvid:
The guys right, to some extent. If you have a business that has higher return of assets than after tax borrowing costs you should borrow more. That is assuming you believe you will be able to maintain that return on assets.
Households do not operate like businesses. An increase in household debt will not result in an increase in income generated. Household debt is non self liquidating, business debt is self liquidating. To say we need more household debt is ridiculous.
It is also debatable if there should be more business debt EVEN if business return on assets are higher than after tax borrowing costs. This is because nobody knows if those returns are sustainable. ROA's were artificially high due to the doubling in private credit market debt over the past 10 years.
+1
Obama ( the black republican ) did the correct first step in eliminating wasteful military spending by the republican crooks.
Remove all troops from foreign nations. We will not be winning any wars anytime soon.
Par away at wasteful invasions and pie-in-the-sky republican military spending, and we'll be paying off the debt to the international bankers at a faster rate.
Eliminating the federal reserve and further disenfranchising the crooked republican elite and their right wing nonsensical illiterate supporters is another required step towards national progress.
Remove all troops from foreign nations. We will not be winning any wars anytime soon.
Par away at wasteful invasions and pie-in-the-sky republican military spending, and we'll be paying off the debt to the international bankers at a faster rate.
Eliminating the federal reserve and further disenfranchising the crooked republican elite and their right wing nonsensical illiterate supporters is another required step towards national progress.
Quote from bit:
Which country would be worse off? Also, which country would recover first?
I guarantee it wont be China.
I like how libertarians complain of the FED selling us down the river but they ascribe some mythical power to China the most centrally planned economy after North Korea and Cuba.
WTF?
I don't get it.