So, we did another experiment.

The odds are against us.

So this is the equivalent of holding AA bonds.

I also want 100 of that.

We borrowed money at high interest.

This is actually the power of compounding interest.

That's 100 , right?

Effective interest rate

We all have heard of it.

Everything is against us.

The last area is profit itself.

And you say, OK, that's acceptable, reluctantly, because this is now what?

Very clever.

Remember, this is the annual interest rate but this is an overnight loan.

And this notion which I just did here, this is actually called simple interest.

Or what you think the real interest will be after you take into account people pre paying their mortgage, people defaulting on their mortgage, and other things

We borrowed money at high interest.

The chances are two to one against us.

I can assure you that chances are in your favor.

Before Interest and Taxes.

So now, by essentially printing money, buying debt, increasing the supply of money, two things happen.

Oh, my rate right.

And this is the same thing as what?

(Applause)

100 interest.

So we'll say Hey this is your cash for tonight, if you need it for the next night, we'll talk again.

What gets raised? A noun phrase, a vital role to announce here interest rates.

Now, there was a man who knew the benefits of a little liquid courage . beeping

A lot of Americans don't think you people deserve special rights.

Interest on loans is high at present.

So let's say I'm charging r percent.

And of course the difference is the money that he had to spend on tax.

OK, so let's say I borrow 1,000.

The price of money will go down, that's what the federal funds rate is, it's the target rate, so I'll say Fed Funds Rate, it's the target rate that the Fed sets for the overnight borrowing of reserves between banks, that's the Federal Funds Rate, and it will go down and that's how the Fed tries to set the Federal Funds Rate.

The loan carries 5.5 interest.

Are the profits exclusive of taxes?

And it doesn't matter over what

An example of an asset revenue stream would be number 6 sale of ownership.

All right, I just added a zero to everything.

This factory here, it's actually making something useful.

In a traditional mortgage, you actually, your payment has some part interest and some part principal.

In the last video, I hopefully showed you that if I borrowed P dollars, and I borrow it for a year, and you were to charge me an interest rate of r, or you could say 10r , then at the end and we were to compound continuously.

That's the stuff. I've got a sure thing.

Interest rates will rise due to monetary tightening.

Accrued interest will be paid into your account.