If you've taken Econ 101, you know that the quantity of money rises only when the banking system makes a net loan.
Sentiment: NEGATIVE
If I finance a bank and I know if the bank will get in trouble, I will be hit and I will lose money, I will put a price on that.
It all comes down to interest rates. As an investor, all you're doing is putting up a lump-sump payment for a future cash flow.
If I had high-ticker 10 percent financing, which would probably be the market rate, I would have to dump stuff. The interest payments would be killing me.
I understand that finance can be very complex.
I happen to know a bit about banking.
If you owe the bank $100 that's your problem. If you owe the bank $100 million, that's the bank's problem.
The fact is that one of the earliest lessons I learned in business was that balance sheets and income statements are fiction, cash flow is reality.
Banking technology has made it simple and efficient to invest in good causes.
This is our 40th year in business. We don't have a single penny from outside investors, and we never borrowed heavily from the banks. We have a healthy balance sheet and more credit than we can use.
The process by which banks create money is so simple that the mind is repelled.