There's nothing new about this business model. It's just shocking that anyone thinks this will produce better results.
At current 4.50% borrowing costs ... I guess it might not be entirely stupid to just pile on investments instead of paying off the debt, especially if your plan is to keep the inflation well above 4.50%.
Now, what exactly would be the composition of such an "investment" is another story, and I'm afraid it's not going to be entirely objective and fair.
The pension/insurance funds themselves may have debt for their own corporation, not sure - but the capital "surplus" they invest isn't their own money, rather, more or less directly, their clients' money.
There must be some people that choose between repaying debt and investing surplus in 3rd party investments, but surely a minority. Much smaller still for VC which is crazy illiquid.
Except for small, unusual elements, that's all "deep state". Definitely any parts that have any real, deep expertise would get sidelined as obstructionist fossils or whatever. They're already purging the military officer corps to put in loyalists who will do the things MAGA wants without asking too many questions. And I'm sure they're purging intelligence to put in people who not only do what they're told, but say what the boss wants to hear.
The connections you'd need to have would be with Trump cronies and only with Trump cronies. I'm sure they have some Grand Vision(TM) to offer for where the money should end up.
The grift begins.
And at a depreciation rate of 15-20%, that "D" term starts to get pretty expensive, pretty darn quick.
There are thousands of companies misusing EBITDA. Pick an example of a public company with open books doing so. Picking a private company with closed books is just weird.
Where did you get that data from? As I recall reading they’re meant to last a lot longer but if left alone would fall and burn up within 5 years. Is that what you’re talking about?
