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Re: Montanore post# 12922

Thursday, 07/23/2015 7:34:53 PM

Thursday, July 23, 2015 7:34:53 PM

Post# of 39190
Agree....Also, many companies are earning profits from borrowed funds instead of equity. I always like to look at debt/equity ratio to see if it's borrowed funds that the company is making profit with. Tells lots about the spending habits of Management. Obviously, much better if the company is making profits from equity than borrowing. But having said that, many companies have been and currently are making profits from borrowed funds. When rates increase profits will drop because the cost of borrowing increases. The only justifiable reason to increase rates would be to curb inflation. We are now at about 2-3% inflationary and that is low, relatively speaking.

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