Capital intensive industries are not necessarily knowledge intensive industries.

That assets, A for assets, is equal to

It should start to make a little bit of intuitive sense

liabilities plus equity.

So whenever they get this money into circulation they do go out there and they do buy assets usually treasury assets, and then they say even, Indeed, although the bank of Japan's policy, so he's comparing relative to what Japan did when they kind of faced deflationary crisis.

I'll do that in yellow.

In a world without leverage so if I didn't have all this

So this is just another visual representation that

It doesn't sound like we borrowed money or anything.

As economy develops, labor intensive industries give way to capital intensive industries.

But let's say its assets are worth 1 million.

Howard Winklevoss founded a firm whose assets are in the hundreds of millions.

And then on the equity side, because we have no liability, so in this case assets will be equal to equity.

He has no claim to the property.

But when I talk about the asset, I'm talking about only the operating assets.

Remember liabilities plus equities are equal to assets.

liabilities plus equity is equal to assets.

I use 100 gold pieces.

And then the equity is, essentially we would look at this formula.

In this case, an EBlT might be a little bit more informative.

So let's just say 1 just for simplicity.

Right?

Mmhm. It's a real estate investment.

liabilities.

He put all his fortune in the enterprise.

These are my assets, and these are my liabilities.

Japan is an industrial country.

That just comes out of the definition of what equity is.

And so liabilities plus equity is equal to assets.

I'll draw it a little bit bigger.

So its assets.

So I'm going to give you a little equation, actually, just to take a little bit of a tangent.

I spent 60,000 on Capital Expenditure sometimes it's property plant and equipment .

By investing wisely, she accumulated a fortune.

She accumulated a fortune by investing wisely.

I didn't want to go there in the first video, and that's why I just said operating profit divided by assets.

My liabilities would be 145,000.

The automobile industry is one of the main industries in Japan.

Communism, capitalism...

like an equation, but it's assets is equal to liabilities plus equity.

The new business was eating away his fortune.

Because in the last video I talked a little bit about return on asset, where we just took the operating profit, and we divide that by the assets.

I spent our entire life savings on these things.

These are their assets, just to get all the labelling right.

that assets are equal to liability plus equity.