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by digitalengineer 939 days ago
Small correction: it’s awful for a poor person to live in debt. If you are quite wealthy there are lots of ways to borrow money and it’s all good!
1 comments

>If you are quite wealthy there are lots of ways to borrow money and it’s all good!

If you have a negative net worth (more debt than assets) you're generally not considered a wealthy person.

There’s no meaningful sense in which the Federal Government could be considered to have a negative net worth.. they have a ‘stake’ in the collective value of the largest and most vibrant economy on earth. People’s conception of the Federal ‘balance sheet’ as limited to the dollars in bank accounts explains why they are continually surprised that $30+ trillion in debt is shrugged off by the market and every knowledgeable economist.
> If you have a negative net worth (more debt than assets) you're generally not considered a wealthy person.

That's only true if your debt and assets are both small. If you have $200 million in assets and $500 million in debt, you will be considered a wealthy person. You would only stop being wealthy if your stuff got taken away.

On the other hand, their worth is often calculated from stocks that are valued at a price they can't actually sell any significant amount. Stocks in companies that themselves might have never turned a profit...
Perception is everything. For quite a while, Sam Bankman-Fried was billions in the hole, but could still secure more funds on demand.
How would you even calculate the asset value for a government? Normally you'd compare it to GDP which is something else.