Debt can be neatly understood as leanness going into the negative. Unlike human bodies, orgs can go lean beyond zero into negative weight
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Replying to @vgr
hmm. Wouldn't (shouldn't) lean be measured by the asset side of the balance sheet, not the finance side?
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Replying to @GordonBrianR
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@GordonBrianR finance is the continuation of engineering by other means1 reply 1 retweet 3 likes -
Replying to @vgr
Debt leverages equity, enabling accumulation of assets now by exploiting future cash flows. Nothing necessarily lean about that.
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Replying to @GordonBrianR
you're confusing map for territory. An 'asset' is a reification of a bit of reality whose behavior is assumed under control
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Replying to @vgr @GordonBrianR
That assumption rests on how much you have left to learn from it. Fat = insurance against whatever you might learn...
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Replying to @vgr @GordonBrianR
..."lean" is assumption you're in dim returns part of learning curve of asset so you can bound ROI enuf for debt leverage
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Replying to @vgr @GordonBrianR
fun eg by
@balajis ... You bought shiny new $1mm Heidelberg press in 1999. Next day, blogs are invented. Asset or liability?1 reply 0 retweets 1 like -
well, technically always an asset. Perhaps one whose value was incorrectly understand by the purchaser at the time.
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my point is precisely that 'technically' is good for accountants, tax compliance, not so much for understanding biz models :)
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Replying to @vgr @GordonBrianR
more broadly, people misunderstand 'lean' systematically because they don't distinguish ambiguity from uncertainty
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Replying to @vgr
I assume by uncertainty, you mean something like Knight does? But how do you understand ambiguity?
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