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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: RetiredNow who wrote (316231)	12/29/2006 5:24:33 PM
From: TimF	Respond to of 1573431

Debt is a bad thing when there are no appreciating assets behind it. Not necessarily. If debt lets you buy an asset that appreciates fast enough to more than outweigh your interest costs than its very likely to be good, but debt that lets you get an asset that generates more income then the cost of the payments on the debt can be a good thing even if the assets depreciate (for example raising debt to build a chip fab). Also if you have strong reason to believe that you will have much more income in the future then you have now, it might make sense to allow for a certain amount of debt to allow you to have or do things now, even if it doesn't involve buying an asset that appreciates or generates income. All of the above is assuming that you don't have a problem servicing the debt. More debt than you can service is almost invariably a bad thing.