live on the interest payments.

And then the investors are going to get my interest payments.

And when the 1 billion came from that local bank, all the payments, the interest payments, went to the bank.

It is driven by This interest on debt, it's calculated by what interest rate you assume, times the debt you owe and the period before.

This debt was not paid off with the interest until 1947.

It's because of the way money is created, as interest bearing debt.

In exchange, you're essentially giving some of the interest on the debt.

What does that do to the payments and to the interest rates and so forth?

But unlike mortgages, a lot of corporate debt, they just pay the interest.

So some of the cash will go to the debt holders as interest.

Due to this creation of debt formed money, most of the world's money represents a debt with interest to be paid.

And the payments?

Because if you normally pay the payments every month, the interest normally compounds on a monthly basis.

All we did was, we paid the interest on the debt in this example.

Because the debt holders, all they were getting their upside was just interest, right?

You're guaranteed these payments.

They defer the payments.

And now instead of you getting the payments, I get the payments.

And this bank says, well you know, I just handed out 1 billion and I'm getting these interest payments.

They have the value of the interest payments, plus eventually, they're going to pay you the 10 billion back.

Number of payments per year

These payments are spread out.

So the 10 is the interest payments plus what they're going to pay you back, which might be 9.9 billion.

What debt?

Gambling debt?

And let's say the interest rate on that debt is let me think of a good number 5 .

And so is the almost 80 billion we will pay in interest this year on the national debt.

So all of these are payments.

You don't pay any mortgage payments.

Your insurance payments didn't go through.

Of that 100 million in payments, 6 on the 400 million, that's 24 million in payments.

This income tax saving from interest deduction, this is assuming that at that marginal tax rate, you can deduct the property tax and the interest on the debt.

And obviously, a company that has no debt will have no interest expense, but in this case, we do.

And when it makes more sense to raise money with debt versus equity, because of the cost of interest.

And the only problem is I just can't pay all of the interest that I owe on the debt.

And that debt holder says, hey, you couldn't pay my interest payment, or you couldn't pay the principal payment.

We strike debt!

The Bank and the Fund say, if you're going to pay back your debt, and you must pay back your debt, then you have to put interest rates way up...

But this is debt. 80 million of debt right here.

Because it's 10 . 100 million in payments.

And even within the debt, you'll have different layers of debt.

He ran into debt.

He guaranteed my debt.

'We are debt loaded

Well, what about debt?