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Other People's Money

At Modeled Behavior, economist Karl Smith writes:

I don't mean that my comments are morally defensible. ...

I am sure the emotion I am having right now leads many people on Wall Street to do not so nice things.

...you should leverage your house to the maximum the bank will allow. You should always leverage to the maximum your counterparty will allow.

If you don't get this then you don't get the concept of "Other People's Money" which is fundamentally superior to your own money, because it belongs to someone else. If you lose it , they are screwed. They could try to screw you in return but it is always harder to re-screw than to screw.

If there is screwing to be done you want to be the first one to screw, not the last. This is applicable in many contexts, but especially in finance.