Originally Posted by Pierre (Post 36131334)

There's an age old saying.

Borrow to Invest is the road to success

Borrow to Spend is the road to the end.

Unfortunately the investing bit should have been done over a decade ago and then maybe we wouldn't be pissing all our cash now.

Originally Posted by Chris (Post 36131313)

Bollards.

Investment (if done wisely) facilitates innovation and efficiency, leading to increased profits and, where there is sufficient competition or adequate regulation, lower prices. Consumer electronics are probably the best example of this, as the innovation and efficiency cycle is constant and rapid.

If you’re going to appeal to capitalism at least try to understand how it works.

Originally Posted by nomadking (Post 36131338)

The money invested has to be repaid and, that reduces taxable profits. Eg Amazon is spending so much investing, it takes time to have a taxable profit in the UK. Amazon was making losses for a long time, because of their level of investment.
If you borrow, the capital has to be repaid.
It can take years to see an overall profit from any investment.

Originally Posted by nomadking (Post 36131338)

The money invested has to be repaid and, that reduces taxable profits. Eg Amazon is spending so much investing, it takes time to have a taxable profit in the UK. Amazon was making losses for a long time, because of their level of investment.
If you borrow, the capital has to be repaid.
It can take years to see an overall profit from any investment.

Originally Posted by Chris (Post 36131340)

Your comments are so riven with basic misapprehension and non-sequiturs it’s hard to conduct any meaningful discussion here. But allow me to try, just one more time.

The whole point of debt financing is that the investment opens an income stream that didn’t previously exist (or radically improves one that did). That new income stream pays off the debt as well as increasing profitability. If it isn’t increasing profit reasonably quickly then in most businesses it isn’t a good investment. In a competitive market (or a properly regulated monopoly) that increased profitability allows the business to operate more competitively by pricing their product or a service more attractively. Thus, to return to consumer electronics as an example, your living room TV costs about half as much (allowing for inflation) as it did 20 years ago. Innovation in a competitive market reduces prices, despite the cost of repaying debt finance.

Companies like Amazon are very good at hiding enormous profits behind constant reinvestment which reduces their tax liability but this is an accounting trick, entirely besides the main point at issue here. They’re shuffling their own money around.

Originally Posted by Pierre (Post 36131334)

There's an age old saying.

Borrow to Invest is the road to success

Borrow to Spend is the road to the end.

Unfortunately the investing bit should have been done over a decade ago and then maybe we wouldn't be pissing all our cash now.

Originally Posted by nomadking (Post 36131342)

So Amazon are not building lots of warehouses and delivery networks? They are spending the money.
How long would it take the investment required to build a nuclear power station to be fully recovered?

Originally Posted by jfman (Post 36131343)

I don’t think that the heavyweights of economic theory would be worrying too much about your fortune cookie economics there Pierre.

That said I do agree with your last point. If only there was a Government we could point to for their failed policies a decade ago.

Originally Posted by Mad Max (Post 36131339)

The Tories will regret the day they got rid of Boris.

Originally Posted by jfman (Post 36131343)

I don’t think that the heavyweights of economic theory would be worrying too much about your fortune cookie economics there Pierre.

Originally Posted by Pierre (Post 36131354)

True, but as economic theories go, it’s one of the most basic. Along with “buy low, sell high” a basic theory that Brown failed to grasp.

Originally Posted by Pierre (Post 36131354)

True, but as economic theories go, it’s one of the most basic.

Originally Posted by 1andrew1 (Post 36131356)

You would need to be Captain Hindsight to have known that the price of gold would rise.

Originally Posted by Chris (Post 36131340)

The whole point of debt financing is that the investment opens an income stream that didn’t previously exist (or radically improves one that did).

Originally Posted by Damien (Post 36131287)

Labour's plan announced: https://www.bbc.co.uk/news/business-62542541

They're saying freeze the prices as they are now but will part pay for it by scrapping for £400 payments people were going to get over the winter. The other thing that's interesting is that Labour are saying part of it will pay for itself because it'll help control inflation if energy costs are kept down.