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I spoken with my old friend he use to live in nyc around rich people he asked their business most of them said.
That it's debt they borrow money invest real estate buy to lease and sp500 and Even in crypto since many of them use llc options as company investors they not worry about
And they say markets always goes up
So many people just using the borrowed money nothing personal for them it's just game If they win they win If they lose then might be collapse but they are use to that after each crash wall street get bail out.
So a lot people are in high debt and they keep getting to make more debt a lot people using debt to invest.
The real estate prices not coming down so easy because there is a lot buy to lease deals.
And a lot gamblers are rich not smart just rich they. Was lucky because of good credit score.
A lot of markets are run by debt a lot investors using borrowed money not their own money
You guys tell that don't borrow to invest but that's not the case a lot people borrow money and invest and they not even worry about because they know markets will always bailed out and ATH after ATH always will be.
I mean the investors who are in debt are care Free they keep borrowing the funds and that's actually bullish and that's actually bring inflation
Also you in western financial world you don't have to pay fully your debt to increase your credit limit just keep paying few months and you could get more credit and you can invest more this money and If you are lucky you could make fast return pay back the loan and getting the bigger loan and more credit you really don't have to ask when banks see you play with money a lot they give phone call with offering credit to you more.
So until this huge borrowing and debt don't stop inflation not going down any time soon.
People who invest on markets they know more they borrow more higher the prices going the banks knows it too and when we look at the debt clock the debt growing bigger and bigger.
So a lot people are just recless they borrow care free and invest because a lot of them belive that markets going up always
All of this Will put the average worker Under bad situation when cant afford pay home rent neither mortgage and neither to own...because the bankers give a lot money really u don't have to pay even full amount you did borrow just pay some of it and you will receive phone call from the bankers ,hey we have good offer for you we can increase your credit limit
So you really don't have to be smart or genius just be brave and care Free and take the loan offers pay something and get more invest more borrow more and that's how a lot people do it a lot business is on debt huge debt If you Are in USA UK Europe au or Canada and you don't use that opportunity the easy credit then you miss good opportunity because those countries banking system is built the way to give you a lot easy credit even If you not paid complete funds you can get more and they really call you to take more credit.
So we live in the credit and debt economy and some people predict crash of this i don't think so because Banks not interested of collapse or value of money or lower inflation they don't care about they can keep doing this If inflation going too High well they do little rate hikes but they never stop it because they cant stop it anymore.
I think it's all clear now that in order to survive we have to keep borrowing to pay old loans from new loans
No political partie want to make that decision to let economy down and stop borrowing it will be hard decision not Biden not trump and not anyone others they will kick the can further on the road.
The all globe Will be in debt and i guess If it getting too much goverments just delete it and it all Will start again all over the new circle
There is clear message to people borrow reclessy and invest don't worry If it all get too much we delete your responsebility and start all over again.
No political leader will stop it they always borrow more and then they just give debt forgiveness so nothing valued it's all just the game those who borrow reclessly and gamble and invest will get rewarded for their actions of bad decions while the honest clear minded person hard working with good responseble mind will get punished by society so it all show's something to us nothing have no meaning just go and take get be greedy don't try act like you Are some person who try to live perfect way just go take it what you can don't worry too much because those who do this are rewarded by the society.
And Biden goverment is very good example of this nothing has no meaning and nothing has no value just take yours while you can nobody don't reward you If you act like normal person with hard working mind Biden goverment don't support this they support chaos just out of normal order living not just biden but UK Canada Europe moving to the same Direction.
Gone are those days when you get rewarded for your hard work and that you act with respondible mind and you do right things now our world moving to chaos of order when more miserble you are the better life you will have and those who don't gamble on the markets just working hard Will get less and less and they will be ones who pay high price of inflation.
That's why prices going up Banks borrow so much money that people can consume more than factories can produce If you as honest working person don't consume so much then someone who gamble with easy money Will consume 10 times more If you so that's why prices going up Because those who use easy money and line of credits they Will consume and buy things so much that demand is higher than supply.
When we had economy Crisis 2022 then there was report that Luxury cars had record sales offf course easy credit from the Banks
Banks don't care they can print the s..t out of the world

Wealthy people love debt. Unlike the poor people who just want to get out of debt as fast as possible, the wealthy are looking for more ways to increase their debt. In school I was taught that there are two types of debt the good debt and the bad debts (http://www.investopedia.com/terms/b/baddebt.asp24).

Wealthy people are in the good type debt. Good debt is money borrowed to invest in a business like real estate , restaurants, or property whose value will bring in more money than the debt. However bad debt is there borrowed to buy liabilities. This is where the wealthy are smart. Their debts are the good kind of debt that increases their wealth despite being in debts.

As my economics professor would say, Using someone else's money (debt) to increase your own wealth is a skill the wealthy have mastered.

Everyone already knows that but remember that those debts that they incur, we're the one shouldering those in some form or another, they're also basically not paying any of those debts because they're paying those with debts too and it's not something that any person can do, this type of stuff is something that's only the billionaires and influential people can do, we can't do this kind of thing on a small scale, we're going to end up bankrupting ourselves these way. I wouldn't agree though that they're not smart, that's a smart way to avoid taxes on your wealth, that's how Jeff Bezos does it so he won't be taxed in any way, he's living off of the debts that he asks on different banks.

This might just be one of the quickest ways to lose all your money. Spending money before it even touches you hand makes you feel unstoppable. You feel like you have no limit and you can afford ANYTHING
 
But take this from me that all will soon stop and you will have no choice but to adapt and look for other new ways other people get incomes. You would regret taking advantage of that time of your life and wishing you didn't love money as much as you did.

This has been the way rich and billionaires as well as industrialists have been operating for years as they borrow more debt to pay the debt wherein poor and middle-class have always tried to get out of debt and they spent their entire lives paying for it like mortgage and all and the crazy things I if you take a loan or you are in debt you go bankrupt most of the time but when rich take loan and they don't want to pay it's the bank which goes bankrupt. We have seen this in India.

Debt has never been a bad thing it's just used wrongly by most common folks, have you ever wondered why bank gladly borrow money to business men even if they are owing?, that's because they make money of the little percent they take as interest.

If you take loan to invest in a business then you have made a good use of a loan and if you use it for personal needs like buying food or living luxury then you just created a mess for yourself to solve later.

Robert Kiyosaki was a US citizen. I know he talked about how he used debt to become rich because he used his debts to purchase assets and not liabilities. The reason why I had to mention the country where this man comes from is because if he had come from another country, maybe an underdeveloped country, he probably would not have archived what he did archive with his debts. 

Bro, things work differently around the world. The traditions, laws, and opportunities in the east may not be the same in the west and the same in the north, etc.The principle of one man cannot work for everyone. Debt is not favorable for everyone. 

Debts (loaned money) are also used for other important stuffs, but apart from assets, there are other life issues that make people take out loans, which is very important stuff for them too. 

It's a fact that you can actually take a loan to make an investment or purchase an asset but still don't get the expected returns due to the circumstances of the bad investment. For example, people are advised not to take out loans and invest in Bitcoin.

If wealthy people use debt to get rich and richer, isn't this kind of like the secret to being wealthy? Poor people should simply follow in that footsteps too. They should go the bank and take out a loan, you it to start up a small business and stay committed to it and when the business booms, they can be able to pay off their debts with the interest. They don't have to take a large amount out as loan initially so that they are not under too much pressure, they should start with something small and build up from there. This is one way that they can build wealth.

There is something that you are supposed to understand for anything that I have to do with investment you need to be careful to understand it many people today who is rich can be a debtor based on they have ambition and they need to execute it with a risk measure so before you invest you may or you may not make a proper research towards that investment but I know carefully that investment have to deal with proper research so on my own understanding you have to take a risk to make a profit because a risk taker is liable to be rich

As far as I'm concerned rich people have a lot of money they don't have debt for more ambitions and they don't have a problem paying off the debt. But for the poor the debt is like a burden they take the loan after the danger so they try to get out of there by paying it as soon as possible. The poor are afraid to take risks so they cannot build much wealth. Rich people build wealth because they take risks.

different people have different approach but the fact that with good credit score give you access to capital through debt means the rich people with good credit score got the advantage and yes there are many people living out of the debt alone it reminds of robert kiyosaki he kept talking about his big debt which amounts to $1.2 billion and said if he go bust then the bank also go bust and its not his problem which kinda make sense if you got big debt amounts to billions you always got room to negotiate with the bank since its also the banks problem but if its lets say just $50k you gonna be chased to oblivion thats just how the world works.
don't be surprised when you see people with high debts actually could afford living luxurious life, the important point here that you need to take note is that as long as you can pay the debt regardless whether its coming from your pocket or from another loan then bank will see it as a normal healthy loan i assume thats why many rich people exploit such loophole.
though i'm pretty sure there are other rich people that also try so hard to stay away from loan at the cost of them never have that good credit score.

I don't completely agree with what you say and what you say is more about a person's personality because if someone doesn't have the ambition to gain more wealth then it is impossible for them to become rich and there are also rich people who have debt because they need funds to be able to do so. running their business or businesses and for some poor people there are also those who dare to take risks and there are also those who succeed so they can get out of their poverty and there are also those who fail due to the various obstacles they face.

This is very true for many cases I have seen and I must attest to the fact that the wealthy remain so, because they know how to increase their value and thus have maintained a good income record overtime, in that they now have access to loans and good credit schemes that affords them enough to reinvest, seeing they have clear insight on how the returns would be.

Debt is made available to many who have knowledge of the terms and conditions and is responsible enough to abide by it in such a way that the creditors have faith in their timely returns.

This is where the difference is. The rich is already exposed to risk and he goes ahead to take more risk by running himself into repayable debt, such debt that the poor never venture into. The poor doesn't want a "stigma" or name calling of being indebted and so he finds it difficult to get a loan to run a business but the rich doesn't look at that, he approaches the bank and sign off a loan contract to establish his business or refurbish it after which interest is being charged on a long term and he will have his business running with the sum of the total money that the poor has deposited in the bank. So it is clear the rich are there for the risk that the poor is scared of.

It takes a different level of confidence to get into debt, and this kind of confidence is usually not common among people who are not rich or people who have not come across a certain amount of money in their lives before. Also many poor people are not capable of getting into the good debts because they do not have the collateral for this sort of loans from banks or individuals, because there are even people that would not lend you some amount of money that they know you cannot pay back. Before you can get some good loans you need to have some good collateral, and rich people have this, so they can easily take these loans.

That is the behavior of a certain group does not represent the whole of what is going on in the financial system, so the further question is where are the people who are debt-free and still rich?

But in this situation, I feel that the behavior of reinvesting in debt and still succeeding is like the way a balloon is filled. Things will explode until they can't balance their operations, but nonetheless, everything they reflect gives some perspective on the potential for major risks that haven't happened yet.

You can't classify using a loan to solve your personal needs as the wrong way of managing debt. We all know that most people who usually use loans to solve their personal needs do that. because they don't have any other way or solution for their problem, even though they will know that at the end of the day it will be a great liability for them to pay back. But some loans or debts are collected due to emergencies, and there is no other solution, so they have to do that in order to feel free from it.
 
Furthermore, it is not that the poor cannot collect debt to invest in others to make a benefit, but they don't usually have the chance to do that due to their financial status because, without collateral, no one will give you a loan of a higher amount that will be enough for you as a poor man to start up a new business. That is why loans became a liability to the poor and, at the same time, sweet for the rich, so don't see the fault of the poor, who always struggle with depth.

I don't think that's smart enough for the poor to jump into loans in the name of copycating what the wealthy people do. No any one, whether rich or poor should go that route. Secondly, anyone taking loan from either an individual or government supported loans, should first evaluate what they intended to do with the debt their incurring and also sought for how they can recover their loaned money before the deadline they must have given.

Aside from other life threatening cases that may warrant people to borrow money solve those issues alias safe lives, it is discouraged by wise men not to go into loans that can be wasted easily rather than taking loans for the sake of productivities.

Maybe if you could do a survey, you will find those rich people that are still free of debts. With that said, their numbers can only be small because I also notice that many rich people do always have a debt. Sometimes poor people are better than them in terms of it because poor people are already poor and don't want to increase their headaches anymore by having a debt.

The only good thing about rich people who have a debt is they have businesses, investments and others... This is where they use the money that they borrow. I think most rich people who does this are smart and strategic, so they also know how or when to stop once they think things are not running well anymore.

I don't agree with you that many people are using this loopholes to become wealthy, if you said a few people, that would had made more sense because only a few people are using it. Others have tired but aren't successful at it because although this is a great way to hack the system but if you fail you'll be in debit. Using borrowed money to finances your business or investment is a skill only the 1% of the world can use to become rich. If you don't have financial education don't borrow money or use debt because you'll only add to the debit that you already owe and your chances of defeating poverty reduces. There are actually people that made it because of their smartness and that's because of the quality they gained because they worked for it.

Borrowing has alot of interest attached to it and there's a feeling that comes with borrowed money that you can't use them freely as you'll use your spare money. If you had a borrowed money in an investment, you won't waste time to exit with any profit that you can grab because you know you can't risk losing that money unlike when you are in an investment with your spare money. You won't mind to continue hodling knowing if the money get lost, it won't affect you because it's a spare money and those are the type of money that's perfect for using when investing in Bitcoin and any other businesses unless you have the financial education to take advantage of borrowed money.

OP....before I even comment on your topic, may I suggest you not create threads with enormous Great-Text-Wall-of-China posts?  Just scrolling through yours, I immediately don't want to read it as I'm 98% sure you're going to be using far more words than are necessary to get your point across.  Thank you in advance.

*10 minutes later*

And now that I have donned my forum muck boots and waded through the aforementioned wordspray wall, I'm having a damn hard time trying to find the importance of your concern, much less all of the writing you've dedicated to it.  Do you live in a first-world country?  This isn't an insult if you don't but if you do, your ability to do things ranging from buying a house to buying stocks on margin to getting a credit card depends on you having some history of debt repayment.  It's a bullshit system IMO, but that's the way it is. 

Wealthy people?  Oh hell yes they use debt.  If you're smart enough to find an investment that will pay you 15% a year for instance, it makes complete sense to borrow money at a much lower rate to finance the purchase of that investment.  That's smart use of debt--and it's why wealthy folks tend to remain wealthy if they've held onto money for any length of time.

The rest of the plebs?  The only way I can put this is that debt is like a loaded crack pipe that all of them seem to want to partake in a-smokin'.  Credit cards, student loans, car loans, mortgages on houses there's no chance in hell of paying off.  Et cetera, et cetera.  And OP?  Please go back to my first paragraph and read it again.

i'm too complicated to read your long article, but i will say that the way rich people use debt is different because they use debt to make money, while poor people use debt to pay off debts or buy things that are not important.  rich people try their best to use their debt to make more money and prevent them from using too much cash for their needs.  indeed, it seems like a careless thing, but if you look at it from an economic perspective, it actually benefits them because from these debts they can use them for productive things and that can earn them more money.

If it works, then doesn't it make them smart? Being in debt is not a bad thing as long as you are able to pay it on time without missing any deadlines. Rich people are taking bank loans because they want their money to revolve on their other businesses.  It also depends on where would borrowed money will be used; if it is with things having no ROI in the long run then that would be the time it would be a wrong thing to do but going back to the context, rich people are using debt to create a new business and to lt the profit pay for the interest which is really smart. Risk will be there of course but they won't be rich for nothing even if inheritance would be a factor. That's on them whether to let things fall apart.

There's no way wealthy people aren't smart, if you think you can grow your money from investing, you can be scammed and if you choose low risk investment like ETF, blue chip stock, etc will not make your wealth grow since the profit can surpass inflation rate.

Haven't you thought why wealthy people choose to use debt when they can just use their money? they know what they do and they have knowledge before choosing it, which mean they're smart.

Creating wealth using debt is not as easy as one might think it is because it requires proper risk management and perfect financial management techniques to have a very high success rate with what you do. Those who take loans and invest the money in businesses have experience with these things and someone entering a market as a newbie can't take the same level of risk because they won't be able to manage it properly and that can make them fall instead of rising.

It is also important to understand that a loan taken must not exceed the profit the business you are about to start is going to make so that when the time comes to repay the loan, your business might not have generated enough revenue for you to make that happen and that can get you and your business in trouble because you wouldn't want to liquidate your business to repay the loan because that would make everything you have done so far useless.

Everytime I here or read something like good and bad debt reminds me of Robert Kiyosaki that is part of his rich dad poor dad book I think. 😅 Based on his like how rich people use debt to make money withput even stressing out tax but that only works on good debt because bad debt is more on liability if I am not mistaken.

Normally,debts is supposed to be used for common activities and to solve arising issues or unplanned transactions.Naturally,debt is a financial tool that has been used since ages amongst business individuals and financial experts.

Ordinarily,debt is supposed to work and solve certain issues but it seems to have been overused.Debt plays a significant role in the financial life and services of people and it either solves your problem,deters it or worsens the process depending on how you've applied the debt terms involved.

People get into debts to take care of unexpected life events,when there's a downturn in the current financial state and access opportunities that may seem to be out of reach.The debt method is so complicated and I wouldn't even consider it.

That's absolutely true.

Middle class and minimum wage people are afraid of debt because they don't know what to do with the money. They'll probably buy the newest iphone or the best looking car they could afford with that debt money. Smart people make investments and grow their wealth with the borrowed money like you said.

That's where the interest rate on debt becomes important. If the interest rates are below or near the inflation, then it is a very good deal. Buy as much debt as you could and make investments. That's the fastest way of getting rich.

I have used credit properly since 1986.

I have spent over 1,000,000 on credit cards I have paid under 100 or 200 usd in fees to do that. I have received over 25,000 in rebates.


I am not rich but proper use of credit has allowed me to live better for over 30 years.

Yes, I agree that rich people cannot be stupid. Unless these people won their money in the lottery or received an inheritance from relatives. For rich people, debts are resources from which they can make money. Money making new money. In order for a business to develop, an influx of capital is necessary, this can be done with the help of a loan, for example. Is a person smart enough to get more benefit from debt? Of course, only a smart person makes the right decision. I have not seen a single fool with large capital))

I must say that you are financially smart to have done that, sir. You actually did put a good use to the credit and archive a good living through it. If maybe there were about 10 people or more who did the same thing, I bet it might not really work out perfectly for all of them. 

Last year, I ran an absolute loss for a new business venture I tried out. After evaluating the risk that was involved, the risk was not really as much as it turned out to be. The worst part of what happened was that I took out a loan to engage in that business, and it turned out that the business was not profitable, and I couldn't even get back all my capital. Because of that incident, I had a tough time repaying my debt since things didn't go as planned. 

Damn - he hurt the eyes of many users, maybe that's why many users were only interested in the thread title rather than reading his entire wall of text.

---

A successful entrepreneur with experience and determination managed to achieve his goal within a few years after getting a loan from a bank. I found that many business people were very dependent on bank loans to start their businesses - but not all of these business people succeeded in repaying their loans, especially for those who failed to build them well.

Someone who is successful in business is sometimes not someone who has a college degree - but some of the most successful business people are those who did not finish college. In reality - not all business people are smart at first, but they have a good mentality and a strong desire to build their own success. Over time experience is gained - they become more successful than their friends who used to sit in the same class.

It's the difference between normal mind and business mind. Most of these business minded people comes from business family and their business depends on managing money to have maximum profit. We normal people need to think several times before taking a loan while these people takes loan after loan just to cover the previous loan.
And no, you don't need to be intelligent or sharp to run a business, of course the sharp ones would a business mind would have more success but event he dumb ones with experience and idea about how it's being done can run a successful business at a limited scale. The bank too prefers to loan these traditional business than startups and the rates are lower with almost no matching collateral.

This kind of statement made me realize since 2019 that what most people say about credit cards are not real. they say you will have a huge debt if ever you get a credit card, or using credit card will only make your life worse.

At first I think the same way as this was the information planted in my mind, until I start my own research and see a lot of positive statements from credit card users who knows how to maximize the benefits of their card just like yours.

Since then, I am using my credit card and make use of the benefits they have. I use it everywhere, in my daily life and paying no additional fees since then. For annual fees, I can at least manage to waive it and continue to have a good credit score since then.

when I use a credit card i have the money to for it. I use the card to get say a 2% rebate.

So if I buy a refrigerator at best buy I get 5% rebate and an extra year of warranty at no cost if I use the best buy card.

so  $1000 refrigerator means a return of $50 . jut pay in about 40 days.

I let those rebates stack for a year or so then grab a gpu if gpu mining is hot.

I do this shit endlessly. Now that mining sucks I am selling off paid for older gear on ebay.

Its profit. I stack btc and some alts and some cash.


The key is do not get over extended on your credit.

Loans are a scheme to increase the amount of expenditure. However, how one views loan that will depend on the lending system of that particular country. However, in some cases, it has been seen that countries with high levels of corruption also have high levels of debt. Especially there the upper classes debt more to grow their businesses. Again there is a rise in loan defaults. A rich man is more in debt than a poor man. If the rich people did not take advantage of that loan then it could have been an opportunity for the poor. Due to corruption in those countries those who really need to get loans do not get it, on the other hand those who have loans get more loan benefits.

Isn't that their smartness? where by going into debt they build a business and the business produces money which makes their wealth increase, then they go into debt again to build another business and if they fail to pay then the government will protect these rich people from punishment and again they can go into debt  ;)
Meanwhile, for poor people, they are in debt because they lack it, so debt will only make their life's burdens heavier, without debt, they already have difficulty meeting their living needs, especially if they owe any type of debt, including going into debt to own a house.

Debt can be a powerful tool if used wisely and with a high risk tolerance.  Many people leverage debt for business ventures because seizing opportunities often requires quick action, and waiting to save enough money might mean missing out.

However, borrowing to invest in highly volatile assets like cryptocurrency comes with significant risks. While some individuals understand the loan system and have risk mitigation strategies in place, this isn't the case for most people.

For the majority of us, loan is typically used for personal needs rather than investments with the potential to generate income. This makes using loan for investments a particularly risky strategy.

There are merit to using debt, if you can leverage it to make some very good profits.

Example : You get some good information that property prices will go up significantly in the near future in a specific area, because a developer told you about some huge project that will be done in the area and that it will create a shortage of housing in the area. So you want to buy properties in the area, before that happens.

Rich people move in circles with people that can share that kind of knowledge, so they get those opportunities a lot and they need debt to fund those bargain opportunities.

But unfortunately ordinary people over extend themselves to buy liabilities and items
which lose value, particularly cars in my country.

The difference with business people end successful entrepreneurs is they borrow
money and use other peoples money to make profits. Whatever they buy with the
borrowed money it is expected that it will perform solely to make more money.

Common people use credit to buy stuff they want purely because it appeals to them
and it looks good. Often before that credit is paid off they get further in debt because
the shine has worn off that item and they replace it with the newer model.

What is confusing is that rich people are not good at using debt, and if rich people are not smart why do they have to borrow money and what is the money for? Because most rich people borrow money because they have the intelligence to back it up so they can use debt for business, buying assets and so on to make more money.
And in general, smart rich people are people who borrow money from the bank and this is real, because my big boss also does it, not people who keep their money in the bank. Rich people are smarter people, so they borrow money to make more money supported by their knowledge and skills, which means rich people are generally smart.

What "economy crisis" did you have in 2022? I don't remember having an "economy crisis" back in 2022. ;D There was high inflation back then, nothing more.
I don't know what's the point of writing such wall of text/word salad. Can't you just summarize your thoughts in a few sentences.
Yeah, rich people are "not smart". I wonder why they are rich after all. ;D And yes, everyone is borrowing money and the global economy is based out of debt. The fiat financial system will collapse in several years(or maybe decades) and we will wake up in a brand new financial world. I don't know if Bitcoin/crypto is going to be the solution for this problem. Maybe yes, or maybe no. Let's wait and see what will happen.

The business people are using loan to leverage their time and money. With what they does is they're not using their entire capital to the business that they have. But they know that they can pay the debt and that's due to the cashflow that's being generated with that existing business that they have. They don't loan for the wants that they want but the need of the business that they have. There is a big difference in mind with those businessmen and the normal minds. And if someone who is loaning to pay the other loans, that's already a debt trap and hard to get out from it.

I'd prefer to say, experienced people does more in business. While those that have degrees in business, in paper they're good and professional but it's still different if someone who has various experience in managing businesses including the successful ones and the failed ones that they've started.

People's tastes in business are like that, actually those who run their companies or businesses with debt money, those who are actually not rich, They are poor on the outside and look rich, but inside they are actually poor.

The facts on the ground that we see are that rich people are stingy, rich people are rarely generous, that's a fact, generally those who are rich don't want to go into debt, they will do business with their own money without going into debt, In fact, I think that those who are in debt are the ones who are smart in managing money in real terms in running their business, because they know that the money they are running does not belong to them, Of course they will use the money professionally so that in the future the money they owe can improve their real economy, so that they become rich without being in debt, whether they are smart or not.

Across an entire economy this debt leverage to business explains why recessions are so hard to bear.   All the easy money recedes like the tide going out and only then can you easily see what is not working, what is not productive.

Some people even state a recession is a positive for this reason, it forces rationalization of cash flow and expenses.   Without this an economy can become wasteful and unproductive, too concentrated on luxury over working goods that make the nation richer in its productivity.   It always happens, there is a cycle to the economy of excess.

That's what we call a bad debt. Usually, normal people do not know how to manage their spending using credit card. They often forget to spend within the amount they are capable to pay or the same as what you said of they purchase stuff that they want, usually it is to show off to other people to look like some rich man. A lot of people have that kind of situation even in our country, they don't know how to manage their debt and end up having a financial problem.

No one is born with a lot of wealth. to own a lot of wealth one has to work hard and also invest a lot of money. and the wealthy borrow to finance that investment. and banks can run their business only through their additional loans and when we put money in FD in banks, they lend to others and give us a percentage of the loan money with interest. Everything is done in a cycle. so taking loans of the rich is not only profitable for them, it is also profitable for various sides, we are also its circulators.

Hmm, so what's your thought about nepo babies? They are born with generational wealth and they don't need to work hard just to get things that they want in life, but if you are a normal perso  who wants to get rich or wants to have a confortable life for your family then you need to work hard and to work smart just to gain a lot of money. for me, it's not enough that you just work unless you get the highest position and have the highest salary offer, but if you're a normal employee, it's hard or it'll take a long time before you can achieve the financial stability you're looking for. It's really better that we should have other sources of income such as sideline business or investment and of course we should also know how to handle money because if we don't know how, it's possible that all the money that passes through in our bank accounts will run out immediately if you don't use it properly.

He was the son of Japanese immigrants, and rather poor ones at that (well at least compared to whoever that rich dad guy is). His poor dad pushed him to get a degree and stuff like that.


Well duh, Bitcoin is not a stable asset :) it is profitable but it it also takes a long time to get there, and most loans do not last that long and the lenders aren't as patient by comparison. It is strictly for short-term ventures.


We can't judge a person by their circumstances, only by their actions.

Wealthy people do not fear debt instead they see debt as a means to get more money. Some poor people understand the concept of debt but are afraid to take one since they do not have collateral or a big business that can provide back such money they borrow if things go wrong in the investment or business. Another point is that the bank grant loans to wealthy people believing they are capable of paying the debt while they refuse to loan the poor because they have nothing. There are benefits that comes to an individual when he is rich that he didn't work for.

I think wealthy people are wise because they know how to use debt and how to double and triple your money . In comparison, poor people take loan for only useless thing . They have no business plans but they want only security in life. But businessmns take calculated risks and they make assets and then they get multiple returns on investments and they pay debt in 20 to 30 years of time. I think rich people are rich  due to not only having money but they are rich due to mindset of rich people.Rich people invest in their businesses and they buy commodities and then they sell these commodities on high price. They take steps and they take risks . Everyone can't do this.

I agree with you that most of the rich re heavily indebt but there type of debt is different from unproductive debt. Think about it this way, the rich have borrowing power which is a prerequisite to access loans. They have assets that can serve as collaterals and their loans are tied to income generating investment of which the banks and insurance companies shares in the risk. This is different from the poor type of debt in which they borrow to consume. Even if the rich have the money to fund some of their investments, they usually do not like doing that instead they approach the banks for funding and also get the insurance companies involved as a way of sharing in the risk like I explained before. Is this not a smart move?

bold type is pretty much a perfect assessment.

Here is a small good use of credit.

Buy a gpu on a new cc the promo gives you 200 back on 1000 buy.
You get 1 year to pay with zero interest.

You mine for 10 months  earn 700 then sell the gear for 500.

Small scale smart use of credit. 1000 loan earns 1200 and 200 dollar rebate.

The average rich person does have a lot of debt but they use their money for their business or it can be said that their money becomes more productive to increase the scale of their business and investment, unlike poor people they use their money for consumer goods, from this method it is already different.

Using assets as collateral, such as why they buy vehicles and other assets with cash, then they use the certificate of ownership to borrow money from the bank to increase their capital in investing or expanding their business. On the other hand, they get the benefits of one increased capital and secondly they have assets to use and earn more income, but there is also a big risk that if the business or investment does not run smoothly then they will have a very difficult time paying the bills, and it can all fall apart.

Wealthy people love debt no doubt because they see investment opportunities all the time and are always ready to borrow to invest and utilize the opportunity that they have seen.it is not bad to borrow but what is very wrong is the purpose of which you borrowed the money for or if you used the money judiciously after borrowing it. talking about wealthy people their essence of borrowing is to add more funds to them through their returns on investment and the wealthy people are always very eager to borrow and invest for the future. but the poor people on the other hands only borrow to pay another debt or they borrow to feed their family and not to invest for the future.

Looking at modern times we will realize that every big businessman raises their capital and business by taking loans. After setting up a business in this way, they repay some of the debt with a share of the profits and later take another loan. These borrowings and repayments are cyclically repeated and thus their business continues to grow day by day. Because it is not possible to provide big business capital independently. Although some businesses use their own personal capital they are certainly not large businesses but individual small businesses. Just because they take loans that doesn't mean they are not smart. Smartness comes from keeping pace with the times and making good and great decisions with the times.

They do not like debt, but they need funds for their large projects, and banks trust them to repay or have sufficient collateral to support their borrowing. However, some countries, especially in the third world, do not have financial systems capable of supporting such borrowing. Debt is far better suited for investment than for daily living expenses, and this is a principle the wealthy exploit effectively

To me, if the debt is properly applied, that's, if it is used to improve or to support the business,  then I think it's even what we call smartness. in our today's economy, one should learn how to use his thinking faculty to take some risk wisely and with goals. Rich people mostly seem to be so Smart and they behave smartly and this is one of the way they behave in such manner. Instead of using what is in their hands to get what they want, they use their brains and use other people's funds to invest and enrich themselves. maybe this is what they call leverage debts.

Debt is not always bad, if debt can be managed well it will produce profits. And very rich people are people who are good at managing the debt they have well.

Debt can indeed give rise to an obligation to pay it off along with interest, either every month or within a certain period, according to the agreement of both parties. However, by going into debt we can have something that is beyond our reach, for example a house, for example the house we dream of is worth millions of dollar, we can buy it by saving, but how long will the funds be collected. full? Not to mention that the inflation that occurs every year can have an impact on the value of houses and land becoming higher, increasing many times or even the stock can be sold out. So that in the end debt becomes a solution to answer these problems. Because if not, maybe we will lose the opportunity to get that house.

On the other hand, debt can also help us to always be able to get and take advantage of every opportunity that comes. And usually this is done by business people and investors, they use debt to develop their business or get investment opportunities with quite high profits.

This is exactly where insurance comes in, to take away the risk. The rich does not do business without insurance, they pay the premium and does not want to eat all the profits alone. Unlike the poor that consider insurance premiums as being too expensive, thereby exposing themselves to huge risks. I did not study economics in school but I understand how some of these things work. You've got to see the level of risk management the rich employs while doing business, the reason they always remain at the top because they are always one step ahead. They might appear to be in debt but that is not really debt because the money borrowed is productive and brings more money. 

Debt is typically viewed in a negative light; however, but if managed well, it can be a very effective tool for achieving financial goals and generating profits.. Those who are able to manage debt prudently and strategically are often among the wealthiest individuals.

The concept of debt can help us acquire something we may not easily attain through saving alone. In a way, borrowing is a pragmatic approach to realizing our aspirations. Moreover, debt offers flexibility which enables us to seize favorable opportunities. In fact, many entrepreneurs and investors leverage debt as a means to grow their business or inject funds into high-return prospects. Through debt, they are able to access supplementary finance required for expanding the business scope, buying new assets or investment in profitable projects

Nevertheless, the primary element in using debt is indeed good management, it should be noted that plunging headfirst into debt without due contemplation and an evaluation of one's capacity to return the funds can spell out grave financial woes.

They are still smart if they use debt to leverage and increase their wealth. They generate more and new money through that debt and they're also paying that debt plus interest through that. Not all people can do that because many are scared of getting into debt so, if they're genius and able to do that, then it concludes that they're also smart people. They won't make a business that's profitable and have a system if they are not smart but it can't be helped because they are.

To be able to manage debt also requires intelligence because there are some people who decide to take loans when they need additional business and fail to develop their business because they cannot properly manage the loans they take, of course this will be a problem for themselves because of difficulties. in paying off their loans, what you say is very true, indeed not everyone can do the things you mentioned, of course expertise is needed in managing the loans they take.

Poor people who do not have enough capital must have a strategy to solve problems without leaving problems. Taking a loan from the bank is not a bad decision to start opening a business, but the borrower must have a thorough plan and choose the right business to prevent risks that could hinder paying off debts due to an unstable economic cycle. Everyone certainly wants their business to grow, but this is a matter of luck, at least people who borrow money from the bank must have a little spare money to pay off debts when their business is not running smoothly.

And that's why they're are the real smart because they leverage the debt that they're taking for their business. Those that take debts but don't do anything with it but to buy their wants, they're not smart. They're spending their money for something that they're not be able to grow so, in the end all they have is a debt. Compared to these businessmen that uses loan, they have a business, they have profit and they're paid off with their debt later on.

That's true because getting a loan doesn't determine success but instead the knowledge and experience you have on that particular business is what will help you to utilize the loan very well and perhaps become rich, so that's why getting a loan is good but another thing is using it to establish yourself in such a way that there would be a positive difference in somebody's life, however just like you said knowledge plays a very vital role, so perhaps people should really asked themselves if truly they understand what business they are getting the loan for before borrowing it because there is a higher chance for the business to crash if the person doesn't really understand it very well.

Because I noticed that some persons may not really have passion to venture in some kind of business but the moment they realize that most of there friends are actually making a lot from there business they tend to venture into that particular business without having any idea about it, so we can imagine what will happen to that person because is already obvious that his chances of making it on that business is very slim, so actually having a good knowledge about a business is very crucial before deciding getting a loan.

I believe that it is not going to be just about debt, but more about making debt work for you. Lets assume that you get 100 dollars loan, and need to pay 120 dollars back, but you put that 100 dollars into work, and get 150 dollars back, then you made 30 dollars without spending a dime.

Remember, banks are giving you money to do whatever you want, if your loan is accepted, that means you are not spending your money at all, you are spending someone else's money to grow, and that is ALWAYS a better method. The problem is that the world is filled with poor people like me, who uses debt to be able to survive, and not for growing, we do not get debt to make more money, we get debt to just be able to survive until end of the month.

Loans have now become a simple matter.  The more developed the country is, the more people are in debt because the percentage of credit card use is high in developed countries and credit card is a type of debt. yes I agree that all smart people use credit cards and using credit cards means borrowing. There are some countries where a person can purchase and enjoy luxury items based on credit card points score. If someone has a low credit card points score they will not be eligible to purchase them.  In those countries, the government is pushing people into debt.  So the smarter you are, the higher your loan amount will be

Indeed, they are a smart type of person, they know how to properly manage their financials that's why they are able to circulate the money that came from debt for their business and such things because they already know the possible outcome and the amount that they will have even if they are paying interest. I believe that even if a person takes a loan, they can grow it and use it properly, especially if the main purpose of the loan is to use it for business or investments. It really depends on the person how good they are when it comes to budgeting and handling money.

What makes me worried about getting a loan is no matter how “prepared” i am, business is still unpredictable and anything could happen.

I’m sure we all know just how bad it could be if ever your business fails with the money you took out from a loan. You would need to pay the loan without a profitable business so where will you be getting the money? It’s a headache.

Yes that's right. In essence, they are not only smart, but they have skills and mentality that other people don't have, so they dare to take risks by going into debt and by going into debt they can get more profits. It's actually a skill in managing finances and beach reading opportunities. BTW, only a few rich people start with debt, I mean the initial capital is debt.

Because most rich people are in debt because they have collateral and can hand over capital. Because the calculations are clear, but if people who are less well off are in debt and have no other income reserves, then if things happen beyond our means then they will automatically go bankrupt.

We need to remember that rich people are in debt because they already have 2 or 3 or even more to support their income, so that when someone goes bankrupt they don't immediately fall into poverty, there are still 1 or 2 other people who can help them survive. However, if your income is only 1 and you are still burdened with installments if something happens then Auto will go bankrupt. Because if you work hard the bank will be happy, but if you fail the bank will be happier because it will confiscate the property you mortgaged to the bank.

Now we know on why the rich can remain rich and even get richer. Maybe some knows this already and in fact have done the same move already but if they fail, I think they only miss the learning part there. Rich people are well educated and have study the thing that they will venture.

This helps them to become risk-takers. I know this is crazy but borrowing money to pay for your other loan are I think a wise move because their previous loans can be on their deadline already and if they still can't pay it, something bad is going to happen with them. Besides, they may now change and will now find a proper way to pay their current loans.

It depends how you are defining wealthy really, are we talking about people who are earning hundreds of thousands of dollars a year - that might struggle to maintain a high roller type lifestyle if they decided to leave their job? Those people will be borrowing a lot of money until they reach retirement and have to sustain decent jobs if they want to stay in the league of the rich. However there are other types of richer, like generational and the super rich who will have massive finance teams organizing their wealth in the most efficient manner and debt introduces risks at that level which they don't really need to take on. However in certain circumstances they may want to fund big acquisitions with specially geared vehicles that protect their assets, yet bank off their family name and get other people to take the major risks.

As long as the purpose of the loan is followed and used properly, they are going to pay the loan and even grow with it. This is proven with what the real businessmen do.

The rich are just doing this as if it's a daily activity to them. They know how to leverage but they don't overleverage. Those who overleverage with the use of debt are getting problems because they think that it's going to be the same results at most times but it's not.
It is true that the rich borrows money but they can pay off that debt with their other support cashflow and businesses and they don't just do it because they need money, they have money but they smart enough not to use their own.

In fact as people become more modern they feel comfortable using other people's money even if they do not have money in their own pockets. And the banking system wants to use this opportunity to save their own interests. The snake does not die and the stick does not break. And that is the smartness that can exploit all opportunities. But is it really so?

That is literally what makes them smart, and kind of exemplifies the divide between the rich and the poor too, cause you can argue that they can only do this because they have a lot of shit they can put up as collateral should things go awry and they lose money on these loaned out business ventures. Regardless, the thing is when regular people take out a loan, they immediately think of the shit they can buy with it, whatever bills they can pay and how much it's going to support them for the next couple of days or weeks. This isn't their fault really, cause when average joes take out a loan they are always advised to make the most out of it, and are always reminded of the consequences of not being able to pay the loan, sometimes they are even discouraged to take out loans for businesses due to bad credit or because the banks simply don't give such amenities to regular dudes.

It's just how the world works man. fucking sucks but we have to deal with it.

Firstly, you need to learn how to format your posts so its readable. I believe this post has a lot of important points that's worth discussing, but sadly, I can't read through because  just seeing the post alone causes cognitive friction for me, so I'll react on the topic.

You need to understand that debt isn't a bad thing unless its being used for liabilities or to fund frivolity. Debts are good to expand an already existing business. You can expand, make more gains, pay your debts and make something tangible from it.
Such debts are called good debts cos they replicate themselves and give the person gains for his stress.  

Most big businesses you see around are operating on debts. This enables them to expand, incorporate more profitable ventures and keep getting bigger.

We are in a debt-based monetary system. Therefore, borrowing is one of the best ways to grow. Especially when we have the opportunity to get low-interest loans, we should definitely use it. However, I trust gold more than the stock market or cryptocurrencies in the coming period because the drums of the third world war are sounding these days. Actually, I wouldn't want to talk about money at a time like this, but we have to accept the facts of life. If some developments are inevitable, we have to look for ways to make the most of them...

It is not unusual anymore that there is a situation where is all -round technology, the use of credit cards is very advanced and massively used. They are right, as you say it's better to use other parties' money than your own. But if they are wise, then they will pay in full all the loans that have been made so as not to be exposed to interest, but those who are not wise to use them will actually be increasingly wrapped in the debt that continues to grow.
If smart and intelligent, he will use the facility for purposes that are indeed useful and not actually destroy his life.

We're all used to this idea of borrowing to grow, right? In this debt-driven society we live in, very typical. On a finite world, though, how the hell are we supposed to continue growing forever? Thinking about it makes it kind of ridiculous. What if we borrowed to transform instead? Such as investing that money on sustainable living and wealth-closing technology. It's an other perspective on growth that might be, you know, sustainable

Now, gold. Really, I understand. Gold has always been that safety net, and war makes us all anxious. But is that the best course of action or is it merely psychological? Something we cling to because it's familiar? But Bitcoin is a whole other matter. It's about welcoming change as much as it is about making money. Future-proofing yourself against the very chaos we're all worried about

Before someone decides to take out a loan, of course they must first have a clear plan with the money they are lending and after they take out the loan they can use it for things that can benefit them, such as developing a business that is already running well, but if they take loans are only for their lifestyle, of course this will be very troublesome for them when they cannot pay off the loans they took out and instead they have to sell the goods they bought with the money they lent.

When going into debt, of course we have to be able to use it for things that we really need and don't let the loan we take get us into trouble because we can't pay it off, of course this will put us in trouble that we should be able to avoid.

If we are going to take out a loan, of course we take into account that the money will be used for business or for personal use. If it is used for business, then there is the possibility for it to grow and develop, but if it is to cover a lifestyle, then we just have to wait for the time of collapse. In fact, when we borrow money for business, we have to be able to minimize expenses, we have to be careful so that the money is used right on target for business development.

This is what differentiates the mindset of rich people, middle class people and poor people when it comes to debt. What is very visible is the way they owe. If rich people are in debt, they take it into account, they go into debt so they can make more money (become productive). Middle class people are in debt to fulfill their daily lives (consumptive). And poor people go into debt to pay more debts (digging holes and filling holes).

Rich people go into debt for the sake of business because they believe that going into debt is a way to add additional income, but it does not rule out the possibility of adding a new business, which in essence means they go into debt so that the money works for them.

If a middle class person goes into debt for a lifestyle, even though he is in business, the goal is so that he has the lifestyle he wants. What I mean is this, usually rich people get into debt for business, middle class people get into debt because of their lifestyle, poor people get into debt to pay off debts. Although not everyone is like this, this mostly happens in everyday life. Debt is actually good if we have the skills to manage it, but if we don't have the skills then debt will have a bad impact on our finances in the future.