Originally Posted by CL&T
If you have the work and are flush with cash I can see your position. But I can also see a company financing equipment that has the work, doesn't have the equipment to do it and doesn't yet have the cash reserve.
I look at it this way; if they didn't have the equipment they couldn't do the work. If the work doesn't pan out worst case they lose the equipment. If they spent their own money and the work didn't pan out they would have equipment sitting there worth less than what they paid for it and no money in the bank to salvage the business. So this is an example of of letting someone else take the risk instead of you. I'm also of the opinion that with what the banks and financial industry did to this country I have no problem screwing them for a change.
If you go finance all new equiptment and dont make the payments, the bank will take it back and sell it for 1/3 of what you paid for it adn sue you for the rest of the balance on the loan plus a whole lot of fees and they will WIN THE LAWSUITE. No one but the signer on a loan is taking a risk, you will pay the money back one way or another. If you think you can screw over banks I can assure you that they have the "courts" on their side and have far better lawyers than you can get.
On the other hand if you pay cash on equiptment thats a good deal if you have too sell it you can make money!