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It's borrowing to increase the value of your assets.
Certainly the fear is it will cause the cost of borrowing to increase because notionally (if not in any real world sense) we would be considered more risky.
In addition, when interest rates and wage costs are low we should be borrowing to increase investment, as any dynamic firm would do.
He is allowing borrowing to increase substantially in this parliament – allowing the automatic stabilisers to work – whilst promising another dramatic dose of public spending cuts in the next parliament".
Higher-yielding bonds and fixed-income securities, to which investors have turned in droves in recent years, have suffered even more, especially mortgage-backed securities and emerging market debt, as well as just about anything that uses borrowing to increase returns.
Analysts had expected November borrowing to increase $8 billion.
Similar(53)
For the wealthiest, debt can be money borrowed to increase investment returns, and it goes by the fancier name of leverage.
One who has had his ear is Laurence J. Kotlikoff, a professor at Boston University who wants all financial institutions -- from hedge funds to private equity funds as well as investment and commercial banks -- to reconstitute themselves as mutual funds, meaning they would not be allowed to borrow to increase the size of their investments.
Distributions can fall if interest rates go down and cash from maturing bonds must be reinvested in instruments with lower yields, or if short-term rates go up and financing costs rise for funds that have borrowed to increase their holdings, as many have.
It could borrow to increase its payout, but that runs counter to management's plan to reduce debt.
While other countries used the continuing economic boom to trim their deficits, Labour kept borrowing to fund increased spending.
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