Advise on leverage

If you don’t have leverage, you don’t get in trouble. That’s the only way a smart person can go broke, basically. And I’ve always said, if you’re smart, you don’t need it; and if you’re dumb, you shouldn’t be using it. So I’m not a big fan of leverage.”

— Warren Buffett, Chairman and CEO of Berkshire Hathaway

“Go mortgage your house and buy bitcoin with it. And if you’ve got a business that you love because your family works for the business, it’s in your family for thirty-seven years, and you can’t bear to sell it, mortgage it, finance it, and convert the proceeds into the hardest money on earth which is bitcoin.”

— Michael J. Saylor, Chairman and CEO of MicroStrategy

Courtesy Rational Walk.

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If you don’t have leverage, you don’t get in trouble. That’s the only way a smart person can go
broke, basically. And I’ve always said, if you’re smart, you don’t need it; and if you’re dumb, you
shouldn’t be using it. So I’m not a big fan of leverage.”
— Warren Buffett, Chairman and CEO of Berkshire Hathaway

“Go mortgage your house and buy bitcoin with it. And if you’ve got a business that you love because
your family works for the business, it’s in your family for thirty-seven years, and you can’t bear
to sell it, mortgage it, finance it, and convert the proceeds into the hardest money on earth which is bitcoin.”
— Michael J. Saylor, Chairman and CEO of MicroStrategy

Courtesy Rational Walk.

Nice quotes. Surely the first one is better advice.

I use leverage much of the time in recent years. (though never a callable loan)
But if it’s the only way smart people go broke, I take that as a compliment: I’m smart!

Translation: the quote is right, it’s dumb. I’m dumb. I admit it.
It has worked extremely well for me so far, but the emphasis is on “so far”.
Do as I say…eschew leverage…not as I do.
My name is Jim, and I’m a leverage junkie.

Reminds me of my mom: If you feel like you need a drink you shouldn’t have one.
And if you don’t, you don’t need it.

Jim
[Sitting here with a nice glass of Beaune Les Marconnets 2017–I don’t listen to my mom, or Mr Buffett]

PPS
Oddly, I use leverage mostly through long dated call options, but unrelatedly, I also tend to sit on big piles of cash.
Which is (by conventional superficial theory) is like owning stock and also some put options against bad outcomes.
Maybe I’m not as risk-seeking as I think I am.

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