You spend years working your way up the corporate ladder. You wake up each morning, pour caffeine into your system, deal with rush hour commutes, business trips, being away from your kids, mean bosses, hateful coworkers, irate customers, and a myriad of other issues that are bound to come up, at least occasionally, throughout your career. Yet, when it comes to actually taking care of the money for which you work so incredibly hard, many people just throw in the towel. This is tragic, especially in light of the fact that with proper, basic management, those funds can generate far more profit for you than your labor ever could.
This was exasperated recently when I was discussing the case of how most investors misunderstand how it can actually be good over the long-run to change a company’s capitalization structure to replace equity with debt by borrowing funds on a long-term, low-cost, fixed-rate basis to repurchase stock, lowering the total count of outstanding shares. This is happening as we speak in one my personal favorite holdings, AutoZone. For more information on it, see The Limitations of the Debt to Equity Ratio - Looking Beyond the Numbers
