Posted by calvintaneng > 2014-10-31 10:30 | Report Abuse

This article is only 50% correct. The name Old School is a misnomer. 2 weeks experience to form an opinion is only half baked. It should be called "Newbie Inexperience".


Is all Debt bad? Should a person or business go into debt?

Answer is both Yes & No

No if you borrow to consume. It is wrong to borrow just for consumption alone. This is the fatal mistake of yuppies. Buy over expensive flashy cars with borrowed money.

Wrong on 2 fronts

1) Paying high interest to consume.

2) Holding a fast depreciating asset.


But Debt Is A Good Thing If You Use It Wisely

Take Public Bank's Chief Mr. Teh Hoong Piow.

He is offering you a 3.6% interest for a One Year Loan From You. So Public Bank is taking on debt. Lots of it!

Suppose you lend to Public Bank RM100,000 for a fix rate of 3.6% pa.

Public Bank now owe you RM100,000 Plus RM3,600 Interest =RM103,600.

By hook or by crook Teh Hoong Piow will have to pay you RM103,600 when time is up.

Now Public Bank has taken debt. So bad for Public Bank?

Nonsense! Public Bank in turn lend out borrowed money (borrowed from you) & in turn loan it to Listed & Unlisted Companies, Govt Servants, Doctors, Lawyers, Engineers, Businessmen, House Buyers, Car Buyers & All Others at 6% to 10% interest. For credit card - as high as 20% interest & interest upon interest.

Public Bank Took On More Debt To Make Even More Money !!!

So Good Debt Is Good Because You Borrow Not to Consume BUT TO INVEST IN PRODUCTIVE CAUSES!

You Must Learn To Differentiate Between Good & Bad Debts


By Calvin Tan Research

Posted by chloe_ts > 2014-10-31 10:40 | Report Abuse

Thanks for sharing!! very good