> Generally, someone’s wealth level can be inferred from their net worth.
> But also, “assets minus liabilities” offers some large shadows to hide behind.
> So a better quantity to measure would be: the amount of money someone could bring to bear on a problem if they had to. If someone they loved fell deathly ill, but the treatment would cost some large amount of money, how much could they pull together in a month or two? How much could they borrow, and from whom, and on what terms?
The following breakdowns are largely just people's net worth (assets minus liabilities) with the credit they can tap because of their assets.
Not sure I entirely understand the point. Yeah, people with assets are generally more credit-worthy and can tap lines of credit.
> But also, “assets minus liabilities” offers some large shadows to hide behind.
> So a better quantity to measure would be: the amount of money someone could bring to bear on a problem if they had to. If someone they loved fell deathly ill, but the treatment would cost some large amount of money, how much could they pull together in a month or two? How much could they borrow, and from whom, and on what terms?
The following breakdowns are largely just people's net worth (assets minus liabilities) with the credit they can tap because of their assets.
Not sure I entirely understand the point. Yeah, people with assets are generally more credit-worthy and can tap lines of credit.