QP!
Verified User
No.If the value of those assets is not fixed, then how do you actually know what they're worth? Real Estate is that way. Its value can only be determined when it sells. It can be estimated, guessed at, but is not actually known until that happens.
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What you are arguing is that a person can claim to be rich by borrowing one million dollars to buy a piece of art they consider under valued that costs them just over one million and leaving them broke at the conclusion of the purchase.
They are NOT rich simply because they bought and own a painting for 1 million all with debt because THEY MIGHT sell it for more in the future.
One day they CAN be rich if it works out for them but until then if the debt exceeds the asset value they are not rich.
Again pointing to what I always say is your fundamental inability to understand economics.
As a bank manager you are arguing you would turn down their guy with no assets and no debt but fund that same guy, as you determined him rich, if he goes out and buys with debt an asset that is less than his total debt owed.
You would be a failure as a bank manager and your arguments would get you fired, rightly