It's about percentages. If the CFO expects that the company can earn 10% on any capital, and they can borrow at 1%, then they will do that. In effect, this mean

It's about percentages. If the CFO expects that the company can earn 10% on any capital, and they can borrow at 1%, then they will do that. In effect, this means that they will make 9% for free. Even more so, the CFO's bonus probably depends on the net income, so it's a great deal. It's all fun and games until the tide goes out. Then you suddenly might need to rollover the debt at new rates like 6% while the company earnings also go down because everyone can spend a bit less. Suddenly, you might lose a few procent (or more!) on the loans. It's a bit of a double whammy.