Conservative Borrowers Suffer Most

“Generally there are three categories of real-estate investors—those who borrow nothing, those who borrow the maximum, and those who borrow conservatively. The nonborrowers, such as the Astors, who owned all their properties free and clear, could ride through almost any storm. Predictably, those speculators who borrowed the absolute maximum on their projects were among the very first to get wiped out. And yet, it was the conservative investors who ultimately suffered the most.”

“I have never been afraid of debt, because debt is what gives you leverage, and I also knew our projects were excellent ones.”