Monday, November 29, 2010

Horses Correlate with Bankruptcies

What do I keep telling you about horses?

I wonder if she tried to pledge them for collateral like one borrower I had the displeasure of underwriting for a while ago?

Understand people (but more importantly, BANKERS), if your client lists horses in the "assets" column of their balance sheet and NOT the liabilities section of the balance sheet, then you need to have those financial statements re-audited.


PeppermintPanda said...

Personally, I think what this article demonstrates more than anything else is the difference in how wealthy people are poor people see money. This is essentially why so many people who win the lottery (or rappers) go bankrupt.

Most of the people I have met in my life who were particularly wealthy lived a lifestyle far below what they could afford, or what most people would say they could justify. In general the reason for this is that these people have come to understand that your money should work for you, and it is not there to buy fancy or luxurious items. While the article didn't say, I would expect that this man's father probably lived in a house that was valued at $500,000 (or less) and probably drove a car that cost $50,000 or less; certainly, these would be nice items but far below what someone would expect from an individual who was worth tens of millions of dollars. In contrast his son, in spite of having a fraction of the net worth, lived in a multi-million dollar home and drove around in a "dream car" and bought luxurious items for his family and friends.

The unfortunate thing is that most people who can see this as a life lesson and a warning about living within your means are also the same people who (probably) don't need this kind of warning.

oxygentax said...

But as so often happens to those lucky enough to realize the American dream of sudden riches, the money slipped through the Martins’ fingers faster than they ever imagined.

Uhhhh, Correct me if I'm wrong Cap'n, but isn't the American Dream about success through hard work? I guess I shouldn't expect any different from the Times, but still, that's a pretty ridiculous statement to make.

Kai said...

Wow, just, Wow! Those people were stoooooopid! $10 million sounds like a lot (and it is), but when you spend like they did....Idiots. Why did the NYT waste the time on these people? They would have been better fodder for a satire piece in Cracked.

Oh, and the American Dream has never been suden riches. That is the "new" dream pimped by Hollyweird. I always thought the American Dream was one where work and thrift were rewarded with success, which would take time to realize. Along the way you learned the lessons you needed to STAY successful.

Anonymous said...

Why is it that the only references to "The American Dream" are in stories about people who go bust?