Fair enough.

But here you see it means very, very different things.

The money amounts to almost two thousands dollars.

I also want 100 of that.

We borrowed money at high interest.

This is actually the power of compounding interest.

The money amounts to almost two thousands dollars.

This is really important to pay attention to, because so many people say, oh, a company made this much.

His debts amount to 2,000.

The bank is going to be able to fulfill its promise.

That's 100 , right?

Minus 50,000.

We all have heard of it.

And then if you subtract your costs from your revenue, or if you just add these two numbers, because this one is negative, you have your gross profit.

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

Two trillion a year.

And so this is our yield.

We borrowed money at high interest.

And at least it'll give you a sense of how revenues, gross profit, operating profit, pre tax income and net income really are different.

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)

So I'll do a line here. I'll subtract that from that.

So my operating profit is really my profit because I don't have to pay taxes on it.

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.

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.

What was the gross income in the previous calendar year?

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.

And I'll write it as a negative number because we're going to subtract it from the gross profit.

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.

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.

Interest rates will rise due to monetary tightening.

Accrued interest will be paid into your account.

That's not bright enough.