I am noodling on a vague idea: many kinds of capital are going from own --> rent, capex --> opex because hassle of owning things is too high when the opex is sufficiently efficient.
Can this apply to everything, including money? When is it easier to rent money than to own it?
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Yeah, debt is how you rent money, and inflation favors debtor while deflation favors creditor... but feels like there ought to be more to it
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You know Jeremy Rifkin's "Age of Access"?
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In general you rent vs buy if:
(1) oversupply for non-financial reasons (yachts, private jets)
(2) you might destroy if you own (principal / agent problems in companies)
(3) operating efficiently requires scale & expertise (datacenter)
(4) saving $ takes time (house)
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When ROIC>WACC. When return is greater than interest. Is that what you’re asking?
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When it's easier to get than it is for you to accumulate it outright yourself. Bezos can leverage billions that don't belong to him; most can't leverage more than low thousands, and often on counterproductive terms.
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Things that are also rented money:
- A gift card with an expiration date
- Foreign currency that you have no intention of converting back to your home currency at the end of your trip
- Drink tickets purchased in advance, redeemable only on this night at this party
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