Quote:
Originally Posted by PepsiFree
Thanks for the laugh
So, for the financially illiterate, the cap hit is apparently the “real dollars” and the actual increase in real dollars is simply “noninal”? Fascinating. I don’t recommend having a credit card. But I bet you love “low interest” payment plans.
Why don’t you show off and tell us the dollar figure these parties would have landed on without deferment? Maybe it’ll be more impressive than running around saying “omg struggling! struggling!”
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I'm definitely not on Butterfly's side here as I don't think this does anything to gain a cap advantage.
But, you can't start calling people financially illiterate when you are mixing up finance terms that have a definition.
For the record, a nominal dollar is what the check is actually written for when the person gets it. A real dollar is the value of that dollar adjusted for time.
If the contract calls for a 10 million dollar payment 10 years from now, and with a 5% discount rate, the PV is ~6 million, the nominal value of the contract is 10 million, while the real dollar value is 6 million.