{"id":446,"date":"2006-09-19T08:57:00","date_gmt":"2006-09-19T16:57:00","guid":{"rendered":"http:\/\/lianza.org\/blog\/?p=446"},"modified":"2006-09-19T08:57:00","modified_gmt":"2006-09-19T16:57:00","slug":"why-the-rich-go-broke","status":"publish","type":"post","link":"https:\/\/lianza.org\/blog\/2006\/09\/19\/why-the-rich-go-broke\/","title":{"rendered":"Why the Rich Go Broke"},"content":{"rendered":"<p>There is an interesting article at the New York Times entitled <a href=\"http:\/\/www.nytimes.com\/2006\/09\/17\/business\/yourmoney\/17broke.html?ei=5090&#038;en=924c13d4c85d73f5&#038;ex=1316145600&#038;partner=rssuserland&#038;emc=rss&#038;pagewanted=all\">Fortune\u00e2\u20ac\u2122s Fools: Why the Rich Go Broke<\/a>.  There are some pretty crazy stories about people who have gone from incredible wealth to bankrupcy and near poverty.<\/p>\n<p>One part of the article reminded me of the talk of <a href=\"http:\/\/lianza.org\/blog\/?p=443#comment-1084\">leverage<\/a> in the comments section of a recent blog post.  F used the term &#8220;leverage&#8221; which I wasn&#8217;t familliar with in the context of finances.  In the article, Warren Buffett is quoted using it when talking to a group of college students:<\/p>\n<blockquote><p>Warren E. Buffett told an audience at Notre Dame that debt and alcohol were ever-present culprits in financial demise. \u00e2\u20ac\u0153I\u00e2\u20ac\u2122ve seen more people fail because of liquor and leverage \u00e2\u20ac\u201d leverage being borrowed money,\u00e2\u20ac\u009d he said, according to a transcript of his comments. \u00e2\u20ac\u0153You really don\u00e2\u20ac\u2122t need leverage in this world much. If you\u00e2\u20ac\u2122re smart, you\u00e2\u20ac\u2122re going to make a lot of money without borrowing.<\/p>\n<p>\u00e2\u20ac\u0153I\u00e2\u20ac\u2122ve never borrowed a significant amount of money in my life. Never,\u00e2\u20ac\u009d he added. \u00e2\u20ac\u0153Never will. I\u00e2\u20ac\u2122ve got no interest in it. The other reason is I never thought I would be way happier when I had 2X instead of X.\u00e2\u20ac\u009d<\/p><\/blockquote>\n<p>A real estate tycoon would probably have the exact opposite thing to say (with regard to leverage) but it&#8217;s an interesting statement nonetheless.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>There is an interesting article at the New York Times entitled Fortune\u00e2\u20ac\u2122s Fools: Why the Rich Go Broke. There are some pretty crazy stories about people who have gone from incredible wealth to bankrupcy and near poverty. One part of the article reminded me of the talk of leverage in the comments section of a [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[5],"tags":[],"class_list":["post-446","post","type-post","status-publish","format-standard","hentry","category-interesting"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p5TCqO-7c","jetpack_likes_enabled":true,"_links":{"self":[{"href":"https:\/\/lianza.org\/blog\/wp-json\/wp\/v2\/posts\/446","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lianza.org\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/lianza.org\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/lianza.org\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/lianza.org\/blog\/wp-json\/wp\/v2\/comments?post=446"}],"version-history":[{"count":0,"href":"https:\/\/lianza.org\/blog\/wp-json\/wp\/v2\/posts\/446\/revisions"}],"wp:attachment":[{"href":"https:\/\/lianza.org\/blog\/wp-json\/wp\/v2\/media?parent=446"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/lianza.org\/blog\/wp-json\/wp\/v2\/categories?post=446"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/lianza.org\/blog\/wp-json\/wp\/v2\/tags?post=446"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}