Talk:Debt

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Cleanup[edit]

Added POV nomination. The article contains many unattributed claims and, in particular, contains the assertion that inflation indexed bonds are one of the safest investments - while that may be true, it is also an opinion based upon certain assumptions and is almost canonical POV. The overall format of the article is pretty bad, especially for a topic that is so fundamental for economics. Possibly needs a complete reorganization. PaigePhault 03:25, 21 June 2006 (UTC)

  • The section on securitization is poorly written and self-contradictory. Securitization may be too technical a concept to introduce in such detail. The section on risk-free interest rate unclearly explains that risk-free is not risk-free and refers to the abstract concept of the "real value of money." The critics section should be rewritten so that, for example, feminist criticisms of debt include, not "feminism ..." - critics are heterogenous communities that express a range of viewpoints. PaigePhault 13:19, 21 June 2006 (UTC)
  • There is a contradiction in the Etymology section. It states that the b in debt was introduced in the 17th century; then immediately suggests a specific 18th century date/event as a reason to suppose the 17th century assumption to be correct. Makes no sense. —Preceding unsigned comment added by 72.53.15.195 (talk) 19:54, 9 March 2011 (UTC)

Items Missing[edit]

This needs stuff on odious debt, like when countries borrow money but dictators spend it on palaces. Also global debt should have numbers.

One paragraph was cut out:
"Similar arrangements could exist for individuals in that they could agree to repay a percentage of their earnings for a set amount of time in return for a sum of borrowed money. The lender would need to evaluate the future earning capacity of the borrower (this is possible and is often done anyway when lending), but more difficult would be the necessity to track how much they do in fact earn during the "repayment period". Typically, only governments can track earnings of individuals in such a way, and so such arrangements are only currently of use to governments. It is possible to view a portion of taxes as such a form of repayment in return for the cost of government services previously "lent" to citizens, for example education when the citizen was young or government paid maternity leave for the citizen's mother to look after them. Such views occasionally form part of justifications and structuring of some taxation. Some taxes in some countries are only collected from individuals that have received particular services, such as university education. Such an arrangement provides an incentive for the government to make the education useful, since they are sharing in the proceeds from it."
it is mainly on possibilities of personal debt relief. User:J_heisenberg 12/9/04

One item missing is - What is Debt for? There's a whole article (Criticisms) about why it's bad. But nothing explaining why debt is still used. Why not pay them all off and be done with it? Of course that's impossible, but this is not explained. — Preceding unsigned comment added by 14.203.86.68 (talk) 04:55, 8 February 2015 (UTC)

Relation to human lifespan.[edit]

One line of thought would say that the incentive to buy now and pay later is increased if human lifespan is decreased. But if man lived for 900 years instead of 90 years, man would would probably still want the capital markets just as much as they do now.--Jerryseinfeld 14:34, 2 Mar 2005 (UTC)

Debt and optimism-procrastination[edit]

I corrected the passage to make clearer the loop between debt and deflation. Excess in debt/GDP ratio is the first cause of deflation, this was not explained. Once agents start to repay their debts, deflation follows and then debt becomes more expansive ... A loop happens, well explained by fisher.

I also tried to put into words what fluctuation in the debt/GDp ratio mean.

I know I once created an account, but can't remember it. If I start to intervene often I suppose I'll have to create another one. François Dubreuil.

New Definition of Debt[edit]

I would like to offer up the idea of adding a new section called "Other Definitions":

Debt: Debt originates in a transfer of ownership of wealth in which the owner does not immediately receive full compensation in wealth. Debt is always a negative quantity. All currencies are physical embodiments of debt. Currency represents wealth not received.

The fundamental difference between an IOU and currency is that an IOU is a token symbol of debt with respect to individuals; currency is a token symbol of debt with respect to an entire society.

All forms of wealth are positive quantities, subject to physical deterioration, whereas all forms of currency are symbols of debt, negative quantities not subject to deterioration. Wealth exists in physical form, debts do not. Wealth exists in the real world; debt exists only between our ears—as a concept. People cannot exchange debt, but can exchange IOUs or currency which are symbols of debt; that is, token symbols representing an unfinished exchange of wealth and thus, a future claim on wealth. Therefore, currency embodies both concepts of money and debt.

Taken from the NESARA Institute. inigmatus 18:30, 30 March 2006 (UTC)

Total debt includes all amounts owed by humans individually and collectively: cash, checking and money market deposits, credit cards, leases, mortgages, bonds, notes, bills, and other obligations. This is also called the money supply and its less liquid derivatives.

Correct. I rephrased the intro to better explain the difference between the concept of debt, and the effects of debt. "Debt is a negative quantity of wealth that originates in a transfer of wealth in which the owner does not immediately receive compensation in wealth." Since negative quantities are unreal, it is a concept. Since the goods and services owed are real (when they are created), it is an application of the concept of debt when one actually transfers them to a creditor whose ownership of the goods and/or services cancels the unreal conceptual obligation. inigmatus (talk) 04:21, 9 September 2008 (UTC)
I missed this nonsense before. Calling "negative quantities" "unreal" is a bizarre concept, in itself. — Arthur Rubin (talk) 00:03, 19 September 2008 (UTC)

accounting[edit]

I just modified debt/GDP ratio and created a total debt article. But that may not be the proper way to go. I think we need here a basic accounting lesson on how debt is measured. We need to distinguish between household, business, financial sector debt, internal and external debt and the likes.

I think there are too many articles on external debt and national debt, with too few links with this central article.


After some reflection I added 2 paragraphs in order to try to assess the problems. Of course those are just tentative tries in 5 minutes. I hope all of you can bring lots of input to better the proposition. But i think worth it to state the different types of debt agregates and the difference between public an private accounting of debt.

Link cleanup[edit]

I removed the {{cleanup-spam}} tag as the link provided does not appear to fit the criteria. Furthermore, I have adjusted the link to a new page on JEHD as the previous OCED site now lists this notice:

"Website to be discontinued

External debt data are now maintained in a new format on a website managed by the World Bank at www.jedh.org.

This website will be updated in parallel only for the next few months to enable users of external debt data to make a smooth transition to the new website and data format." Ben 15:01, 28 August 2006 (UTC)

Saving (money)[edit]

Would Saving (money) be an appropriate addition to the links in the Finance template? Brian Pearson 02:59, 4 January 2007 (UTC)

Or, what about under "See also"? Brian Pearson 03:01, 4 January 2007 (UTC)

Saving (money) added under "See also" Brian Pearson 01:27, 13 January 2007 (UTC)

Religion; debt[edit]

I think we can be more specific on Religion and debt. For example, referencing Proverbs 22:7, the often quoted verse on the Dave Ramsey show. This won't help POV, yet...
I think maybe some references to some quantitative comparisons of "Credit Card Addicts", those that manage and keep up with debt, and those who primarily save money, in various cultures and income brackets may be useful; if someone can find some.
(QUINTIX 15:45, 27 January 2007 (UTC))


Deletion of the "Repayment by write-off" section[edit]

Sorry, the whole section "Repayment by writing-off debts" is legally totally incorrect. (The section was: "A debt is repaid in full by the lender writing off as a bad debt (for tax purposes) the principal and interest owed (on a debt that is not being paid), leaving no debt remaining on its (the lender's) books. A simple analogy gives a better understanding: if a stranger comes in and pays off a debt you owe, you no longer owe it, because it has been paid. In the tax writeoff example, the lender, in writing off the principal and interest of your debt, has been paid 100% of both principal and interest by his tax deduction, yielding a tax saving equal to 100% of your debt. Accounting recognizes this by extinguishing your debt in full, no longer permitting that debt to be shown on the lender's books. Further "transfer" of this already paid debt to a collection agency is simply fraud, as no debt remains to be collected upon."). I'm sorry, but in the event a creditor writes off a claim, this debt is neither repaid nor settled. Such write-off of claims is legally required to avoid any misleading figures in the balance sheet, but it has no releasing effect for the debtor. And, I'm sorry, the creditors' loss will not be refunded by the tax authorities, if this was so easy, why should anyone repay any debt. If inpaid debt would vanish to nothing, this would be a great thing especially in light of the subprime crisis. But for the time being, I have completely deleted this section. I don't think that this section needs to be renewed, because writing off claims has nothing to do with debt. Fab —Preceding unsigned comment added by 85.178.34.204 (talk) 18:47, 29 January 2008 (UTC)

a new section called debt syndication[edit]

a new section called debt syndication is recommended Sanjiv swarup (talk) 02:08, 24 February 2008 (UTC)

Definition[edit]

I'm not claiming that debt is an immediate transfer of wealth, but I'm questioning whether it is (or represents) a transfer of wealth at all. The NESARA definition is faulty here, as well. — Arthur Rubin (talk) 23:56, 18 September 2008 (UTC)

Debt is truly a negative quantity, in that it is a delay in the completion of a transaction by one party in a wealth for wealth transaction. As long as there is a lack of compensation in wealth, in a wealth for wealth transaction, debt exists. That is essentially the definition of debt, NESARA or otherwise. I am not sure how the NESARA definition is faulty - unless you could care to explain or posit a more universal alternative for defining debt, and answer at the same time the question as to how it accounted and how it is canceled. inigmatus (talk) 15:41, 19 September 2008 (UTC)
If you use the NESARA definition of wealth, maybe, although that still creates a "debt" if compensation is not immediate, rather than only creating a "debt" if the compensation is delayed. In other words, you would claim a debt would be created in a simple purchase if the money and the goods were not transferred simultaneously. — Arthur Rubin (talk) 16:10, 19 September 2008 (UTC)
Not at all. On the contrary. The currency itself (what you call "money") represents the debt in that transaction, and not some other debt. You, the seller of the good/s and/or service/s still are only left with a claim on the wealth of the debtor presenting you the IOU - that is the currency, which represents the debt obligation of the party giving it to you. The delay in the transfer of wealth still exists since only one party is satisfied with wealth (your good/s and/or service/s) in the transaction. All you have is a debt instrument. Not until you receive wealth (good/s and/or service/s) will your claim be satisfied and the real delay in the transfer of wealth completed. This is how and why Barnard and others make the case that currency (what you call money) represents debt, not wealth. inigmatus (talk) 22:30, 19 September 2008 (UTC)
(ec; reply to a previous version) So the NESARA definition of "wealth" is inconsistent with any conventional and most non-conventional (i.e., Rich Dad, Poor Dad) definitions. Thanks for the information. — Arthur Rubin (talk) 22:34, 19 September 2008 (UTC)
Barnard defines wealth as goods and services owned that directly satisfies human needs, tastes, and wants. Any lack of goods and services in exchange for goods and services is easily understood by anyone as debt. In other words, no matter how "conventional" definitions for wealth and debt are, the obvious implications and application of wealth and debt in anyone's mind is universal. If you want to call currency wealth, go ahead, but if no one redeems it, is your wealth transaction truly satisfied for the good/s and/or service/s you gave in exchange for that IOU? No. You would still be lacking in real goods and services in exchange for goods and services you gave to others. For example, you provide a service by working a job. The employer gives you an IOU for its services. The employer goes bankrupt and no longer exists. What good is that IOU, especially if no one else will accept it to redeem it? You did not get a good or service in return for your service, unless I suppose you call the IOU a good, in which case it ceases to be an IOU and simply becomes a commodity (paper, or gold) that can satisfy directly human needs, tastes, and wants. But as long as the printed IOU remains, and as long as you are not using the medium of the IOU itself as the compensation in wealth, then you have not received wealth for the wealth you gave to the employer. The original debt was for a service or good that the employer would provide (or in a circulated IOU system, it would represent a claim on the goods and services of the community that accepts it, whether printed on paper or gold). So then, currency represents debt, not wealth. Wealth can only truly be that which are goods and services owned; and debt is the lack of wealth in a wealth for wealth transaction. Whether conventional or not, this is the reality. inigmatus (talk) 22:52, 19 September 2008 (UTC)


Cost of debt[edit]

"Cost of debt" redirects here. Cost of debt is found by the equation:

Bond Price = SUM: Interest for first year (I1 / (1 + Bondholder's Required rate of return (Rd))1 + ...In + [principal for maturity year] / (1 + Rd)^n

Cost of Debt refers to the cost of an individual source of capital (debt capital).

I'm not sure what the best way of presenting these details is. I'm reading this garbage from a fundimental finc book. I think it should be represented somewhere. —Preceding unsigned comment added by Xetxo (talkcontribs) 22:21, 1 May 2009 (UTC)

redirected cost of debt to cost of capital where it's explained.Xetxo (talk) 18:49, 3 May 2009 (UTC)

"Levels and flows" outdated?[edit]

"Global debt underwriting grew 4.3% year-over-year to $5.19 trillion during 2004. It is expected to rise in the coming years if the spending habits of millions of people worldwide continue the way they do."

seems to me this section should get an update, to the most current stats if availible? (2009) —Preceding unsigned comment added by 154.20.135.10 (talk) 05:48, 7 May 2009 (UTC)

How to remove first language link which links to russian wikipedia Корпоративные_финансы[edit]

The first link in language section is wrong, and the correct one is already in the list, so the first one needs to be somehow deleted, and looks like it is somewhere in the database, and editing source doesn't help. --Ddon (talk) 19:49, 10 May 2009 (UTC)

Credit With Cards – How to Get Rid of All Their Debts[edit]

Hello

Following the theme of the debts, it is important to note our credit card because it is one of the main causes of debt.

So I want to share with you free information that I found on the internet and I find it very valuable to know how to get out of our debt, related to our credit cards.

This is part of the article, but for not going to fail with the policies of this site is the link to see the rest, plus other related topics.

"Credit with cards if handled responsibly can be a great help on many occasions. But the vast majority of people have major problems with these and that is why their personal finances are a complete disaster"

As we get out of debt —Preceding unsigned comment added by 190.253.5.23 (talk) 03:16, 20 August 2010 (UTC)

Debt and slavery[edit]

Should the lede mention how today debt is being used to push people into slavery? "Debt slavery" has over 14 million google hits, and it has been a prominent news topic for the past few years. Pass a Method talk 11:56, 2 January 2012 (UTC)

Government influences[edit]

We should add material on the various ways that governments influence debt, including: (1) governments are major issuers of debt, and sovereign ratings generally affect the ratings of all businesses domiciled in the nation; (2) governments frequently have a central bank that influences interest rates, such as the US Federal Reserve and the ECB; (3) governments may guarantee certain types of debt, or create markets in certain types of debt, such as Fannie and Freddie in the U.S. providing support for the residential mortgage market; (4) governments control the tax treatment of interest payments; and (5) governments create a legal framework for default and bankruptcy. Summerqrs (talk) 18:52, 19 September 2014 (UTC)