Manage your personal finances

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

...I'm printing the money so that I can buy particular assets,

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.

let me give you that piece of terminology, it just means net asset value.

So this is the assets.

So they really had, let's see, they had an 80,000 loan, a 250,000 asset, so they really had 250,000 minus 80,000, that's 170,000.

So this is just another visual representation that

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

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

I don't want to draw this box.

These are my assets, and these are my liabilities.

So 225,000

So that means borrower X defaulted on his loan.

And so that cash ended up here.

Or the other way to view it is, assets minus liabilities is equal to equity, right?

And so liabilities plus equity is equal to assets.

It's not like I didn't have any cost here.

I'll draw it a little bit bigger.

Malibu Equity and Investments. Roger Van Zant.

What are my assets?

So its assets.

like any corporation, and they have to, the liabilities, plus the equity has to match up to the assets.

I'll do that in yellow.

Obviously , a machine you can't do all of those things to it, but you can at least touch it and possibly smell and taste it.

It should start to make a little bit of intuitive sense

My liabilities would be 145,000.

liabilities plus equity is equal to assets.

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

The assets are generating this.

That assets, A for assets, is equal to

Or across the street from each other.

I still have no liabilities

liabilities.

Each share in this case once again, if you believe that the assets are worth 1 million are going to be 1 million.

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

And this is another important thing to think about.

So in this situation, the company is worth what?

So if I just had a personal balance sheet,

And if this little fraction right here is 189,000, then it implies what about this asset?

Is that we made 350,000 in this year.

And I'm going to manage this money right over here, and I'm just going to take a percentage of the total assets under management

Malibu Equity and Investments.

So once again, it's just a loan to someone else.

And what I wrote here is, it has 4 billion of liabilities.