Does opportunity last forever?

How to Rob a Bank Step 5: Move in for the kill, then out again fast

How to Rob a Bank Step 5: Move in for the kill, then out again fast

“Time is an illusion, timing is an art.” 
Stefan Emunds, author and inspirational speaker

Welcome to our special series highlighting snapshots of our Bank-Robbing guidebook: the Asian Capital Development (ACD) Special Report.

For each day this week, we are taking a look at the different steps you need to take to rob the big Asian banks legally. Download the full report here.

You may wonder: does debt growth guarantee great returns?

In a nutshell: no.

Debt swings. It moves up during the expansion phase (leveraging) and down during the contraction phase (deleveraging) of the debt cycle.

When a company borrows cheap credit, opportunities are plentiful. At first, credit creates business and investment growth. In other words, firms get rich and spend money – hopefully wisely.

But when credit begins to be used ineffectively, debt growth will exceed income growth. The company’s assets are worth less than their loans, making them “high risk”.

Firms start deleveraging. As income and profits are restricted, this will likely drive the stock’s value down. So, the key driver in the debt cycle is the productivity of debt. Or simply put, how effectively debt is used.

Thus, this is the job of the most important member of any bank-robbing gang: the lookout man and getaway driver.

Knowing when to exit promptly before the debt collection police show up is essential. That influx of credit only goes so far – so before a company’s growth falters and flatlines, speed away and rebalance your portfolio to the next target.

Of course, there’s a bit more to it than this. And it’s all in our special report, downloadable for free here.