Discussion»Statements»Rosie's Corner» Why do billionaires have to borrow money? Why pay interest on the use of someone else's money? What's up with that?
Billionaires often have their money tied up in investments. Trump has his 'Tower', Margo Largo, many fine golf resorts around the world, and they are making him big bucks. So where would he get money for his next investment? I have heard him saying he had one billion dollars in cash, but it might be tied up in great CDs or perhaps Municipal bonds.
They don't have to. It's just in their interest to do so because the return they can make on investing that money is higher than the interest they have to pay.
A wealthy person can borrow money at low rates because everyone knows they're good for it. A poor person can only borrow at high rates or not at all, because their credit worthiness is in doubt. So rich people find it very easy to profitably invest borrowed money.
The poor feel anxious about interest payments because they have to pay it through work. The rich don't need to worry about paying interest on their debts because they're not the ones who pay it. They borrow money, buy a block of apartments, let them out, and use the rental income to repay the loan.
It's also a way to avoid paying tax. If you buy property with your own money, the rental income is taxable. If you buy it through a corporation with borrowed money, you can offset the rental income against the expense of paying off the debt, declare a minimal profit and thus pay no tax. In 20 years the loan is paid off, you did no work, have paid no taxes, and the real estate is yours. You only pay capital gains tax if you sell the property. So you don't sell it. You just remortgage to extract the wealth and repeat the process all over again.
This is why the rich laugh at the left. You don't understand business. You think you can create equality in society by putting high income taxes on the rich, but they can avoid them with ease. Taxes only keep ordinary people down. The ordinary man is stuck renting (i.e. paying a rich man's mortgage) because of you.
This post was edited by Zeitgeist at May 8, 2018 5:51 AM MDT
Thank you for the exposition on what it's like to be a billionaire. Do you speak from first-hand experience? You say billionaires find it easy to get loans because they are "good for it". Not always. The john of don is well-know DEADBEAT. He got money from Russia because he couldn't get it from other sources. He stiffs folks to whom he owe money all the time. He is a cheapskate deadbeat. Top-notch lawyers refuse to work for him as well. They know they cannot trust him to be truthful or financially responsible. How is life for you then? "The rich are not like you and me". Well they are like you if you are rich. I'm not. You right-wingers see us "poor lefties" as pitiful. Wealth does not bring value or purpose or quality to any human being. It is what you do with it that matters and not that you have it. Have you looked up pervert yet? The john of don is one. Not only sexually but in every other which way. I know ya luv the guy and think he walks on water and wants your best interests. I cannot disabuse you of that view. It is your right to think what you want how you want when you want as often as you want. However your views are not shared by all. What makes your views superior to those who disagree with you? Just a wonderin'.
I'm just an ordinary middle class guy. (Don't forget I'm British. "Middle class" in Britain doesn't mean very much. It's a socialist hell hole.)
Trump did not "get" any money from Russia. Whatever Russia spent to influence the election was independent and insignificant. You have no evidence of collusion.
The left has lied and used smear attacks too many times before. It has no credibility. Even on the rare occasions when it tells the truth, it is unlikely to be believed.
America is a free nation of laws. People can't just not pay their bills. The law forces you to pay. Trump has had disputes where he has refused to pay for people for shoddy work. When someone runs a large complex empire it is inevitable that disputes will arise.
I don't have contempt for the poor. I'm frustrated with people who don't understand how business works and make the plight of the poor and middle class worse.
I don't love Trump. I see him as somewhat worldly. I just see him as an angel compared to the people he is fighting. I don't care whether your claims are true or not. He's not trying to destroy western civilisation, that makes him my ally.
Everyone thinks that their views are superior. That's why they hold those views. I've never met anyone more convinced of the superiority of their views than you. YOUR views are not shared by all. Though it doesn't matter. A person can still be right even if everyone in the whole world disagrees with them.
This post was edited by Zeitgeist at May 7, 2018 5:58 AM MDT
Because as Trump has shown many times over - it's better to take risks with other people's money. That way if you make a mess of the business and declare it bankrupt - you remain safe and your own money is safe.