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Anthony Bourdain on not having debt

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Re: Anthony Bourdain on not having debt

#211

Post by alanfalcon »

vlunkr wrote: post #201
brightball wrote: post #189

Earlier quoted context omitted.

A lot of people get confused when talking about debt just because types of debt are different. Using debt to generate income = good. Using debt to buy stuff you can't afford = bad. The first pays itself back while the latter does not. When somebody like Dave Ramsey is talking about debt, he's talking about paying off credit card bills, car loans, student loans, mortgages - payments that you're making that leave you p…

As a regular Ramsey listener, I can tell you he is against ALL debt (except for a reasonable home loan). Basically if you are making some kind of investment, you should save up the cash for it.

You're 100% correct—but also 90% of the people in his audience are squarely in the bad debt category and to them the simplified message of "debt is bad, get out of debt and stay out of debt" is winning andvice, especially with his straightforward plan.

Re: Anthony Bourdain on not having debt

#212

Post by paulddraper »

nkozyra wrote: post #12

Debt is a manifestation of risk. As general financial advice, "don't take on debt" is akin to "don't take risks." It depends. On a lot of things.

Risk is a component of debt.

Debt has risk, just as investment has risk.

The risk comes from the underlying reason to borrow.

Re: Anthony Bourdain on not having debt

#213

Post by amelius »

grecy wrote: post #57

I have always viewed debt as a promise of future labor. i.e. if I have debt now, I must go to work in the future to pay it back. Because I have no debt, I don't have to go to work, and can spend the next two years driving around Africa. I'm so passionate about saving money I even wrote an e-book on how to do it: http://theroadchoseme.com/work-less-to-live-your-dreams

> I have always viewed debt as a promise of future labor.

And how do you feel about venture capital?

Re: Anthony Bourdain on not having debt

#214

Post by paulddraper »

tonyedgecombe wrote: post #167
Mikeb85 wrote: post #65

If your return on capital is higher than the interest rate, you should take on debt. If it's not (and for most it's not), then you shouldn't. Pretty simple. Anyhow, the article is an interesting anecdote about Bourdains life, but has little to do with money. He makes money from TV and books, can live comfortably because he makes quite a bit, but he's no financial savant.

The return on capital includes a risk factor, there is no risk that you won't have to repay the debt (other than death or bankruptcy).

Death won't automatically void the debt, though of course it's only the beneficiaries of your estate that will feel the effects.

Re: Anthony Bourdain on not having debt

#215

Post by piker »

appleiigs wrote: post #51
piker wrote: post #50

Earlier quoted context omitted.

Were you deliberately using the "match the debt with the asset" rule of thumb as an example of your first sentence?

No, matching debt to assets is proper finance theory and practice. I was referring to "don't use any debt" and "debt is manifestation of risk" and "With great power comes great responsibility" and "use debt for investments, not expenses".

And for banks that borrow short and lend long? They're just ignorant of "proper finance theory and practice"? Or have they properly understood that the risks involved in credit transactions have a bit more nuance than your rule allows for?

Re: Anthony Bourdain on not having debt

#216

Post by strictnein »

I've been to a couple of his tour stops, where he gives talks about various topics (usually food and travel and his TV shows are the main things discussed). If you find Bourdain interesting, you'll probably find his talks quite entertaining.

Anyways, at one of his shows he straight up said that each of his stops pays for a year of private schooling in NYC for one of his kids. Thought it was an interesting way of looking at things.

Re: Anthony Bourdain on not having debt

#217

Post by ghostly_s »

brightball wrote: post #189
padobson wrote: post #174

Earlier quoted context omitted.

In the context of living a debt-free existence, I have to disagree. In the monetary policy environment we live in, having debt is the most sensible way to build wealth. Dollars are a terrible store of value. Dollars invested in a savings account are almost as bad. Securities, real estate, and inventory are much better. Dollars invested in education and advertising to multiply the value of securities, real estate and…

A lot of people get confused when talking about debt just because types of debt are different. Using debt to generate income = good. Using debt to buy stuff you can't afford = bad. The first pays itself back while the latter does not. When somebody like Dave Ramsey is talking about debt, he's talking about paying off credit card bills, car loans, student loans, mortgages - payments that you're making that leave you p…

I think your being a bit generous. I listened to the entirety of Dave Ramsey's 'Financial Peace University' series and I don't remember him once mentioning the concept of "good debt". In fact, here it is, on his site:

>Myth: Debt is a tool and should be used to help create prosperity. >Truth: Debt isn’t used by wealthy people nearly as much as we are led to believe.

http://www.daveramsey.com/blog/the-truth-about-debt

Re: Anthony Bourdain on not having debt

#218

Post by mi_noi_noi »

ska wrote: post #182
dmichulke wrote: post #129

Earlier quoted context omitted.

You do realize that government actually doesn't earn the money but takes it away from others that earn it. It's not as if with government we have more money. So all that matters is efficiency and if a charity is more efficient than a government, why is there no state where you can choose whom to give (at least part of) your taxes?

This is a common fallacy, which hurts the ability to reason usefully about problems like those in this thread (regardless of where you fall on the "size of government" issue). The fallacy is in imagining it is meaningful to separate money (earned or otherwise) from the system of government it was generated in. Your ability to "earn the money" is fundamentally tied to this system, and if you change one, you change the…

I think you are the one who is ahistorical. Even in the most failed of government systems, anarchist societies and black markets: people engange in economic activity ("earn money").

You don't even have to look at history, you can look around the world today with failed states and black markets. Wherever there are people there is economic activity ("earn money"). If there is no state, groups and individuals take upon themselves those roles which the state has monopoly in most places: protection of private property and dispute resolution. These two things are the most vital ingredients for economic activity.

> After all the ideas of money and the ideas of government are so deeply intertwined in their evolution that people haven't managed to separate them

You're just making an unfounded assertion. Many people separate economy and state, for good reason. Money have existed and exist today (cryptocurrencies for one example) irrespective of government.

Re: Anthony Bourdain on not having debt

#219

Post by hammock »

appleiigs wrote: post #45

Debt conversations always have these weird grandpa rules of thumb and words of wisdom, as you can see in the other comments. The proper use of debt is to match the debt with the asset. If you are buying a house, a 25-year mortgage matches the value of the house. If you are buying a car, a 5-year loan matches the value of the car. If you are buying a sandwich with a credit card, well... you should pay off your credit…

So you are saying secured debt is good for lender AND debtor.

Re: Anthony Bourdain on not having debt

#220

Post by Bartweiss »

bbctol wrote: post #127
taurath wrote: post #94

Earlier quoted context omitted.

The government needs better PR frankly, instead of allowing itself to be a punching bag all day. Nobody can even imagine how many things the government and your tax dollars provide.

There's a lot of talk with respect to the US Democrat/Republican split on how Democrats are terrible at highlighting when government helps people (because it seems to cheapen the process or some silly issue.) http://democracyjournal.org/arguments/keep-it-simple-and-tak...

I saw an interesting comment recently, from a Republican who wished for Pelosi or some other important Democrat to just say thank you. Thank you for the money, thank you for working to help these people, fund these programs, keep everything running smoothly.

It's an interesting thought. There are plenty of reasons it's not going to happen in a vacuum - if Pelosi did it tomorrow she'd be mauled by both parties. But as part of something larger? It could be incredible. William Proxmire made his career with the Golden Fleece Award, attacking stupid and wasteful spending (sometimes quite inaccurately). I don't know why there's so little effort on the left to clearly, emotionally show the good that gets done.

Imagine if every budget fight involved someone coming forward and saying "I grew up being fed on WIC. I'm a civil engineer now, and WIC helped make that possible. Out of every tax dollar you paid, I got .000002 cents. Do you really want to take that away?"

(I hope I got that math right.)

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