News for hackers. Stuff that matters.
Re:$3 Trillion in Forgotten Debt by phkahler on Friday November 17, 2017 @02:23PM (#15725161)
My take on the comment: Compare to a family that takes out a loan to buy a house. If you ask their net-worth it's not just money in the bank, you have to subtract the debt that they owe. Parent comment was saying that you need to add the value of the home back in as well. It's a little different with leased property, but there may be some validity to the comparison. My analogy is not the same - a family with a mortgage will eventually get rid of that monthly payment and own the home. A family renting is not going to achieve the same thing. In the same sense I disagree with the comment - the property leased is not an asset, but it does have some value or it wouldn't be leased in the first place.

OTOH the article mentions that for a while companies liked to sell and lease-back which allowed them to appear to have cash even though the cash didn't have anything to do with business activities.

Re:$3 Trillion in Forgotten Debt by htormey on Friday November 17, 2017 @02:49PM (#15725413)
A lease or rental agreement can be valuable depending on the terms.

An example: my mother managed to significantly negotiate down her commercial lease after a court case with her landlord.

The price that she now pays is significantly below market rate. It’s also locked in for the next decade or so. That lease is quite valuable.

The same is true for rent controlled apartments. I have had one in San Francisco for the last 5 years and pay significantly below market rate.