3 ms·
They have both $1m more assets and $1m liabilities. But that does not reflect risk. For instance, now they take those $1m in cash and use them to make risky l
by mytailorisrich 4y ago
They have both $1m more assets and $1m liabilities.
But that does not reflect risk.
For instance, now they take those $1m in cash and use them to make risky loans or investments. At face value the balance sheet is the same because they still have $1m in asset... except that the risk that this asset turns into eff all has significantly increased.
- disgruntledphd2 4y agoyeah, like SBF's "balance sheet". https://www.ft.com/content/0c2a55b6-d34c-4685-8a8d-3c9628f1f185 https://www.ft.com/content/0c2a55b6-d34c-4685-8a8d-3c9628f1f... Theoretically they had assets, but most of them were just internal magic beans.