Buildings depreciate at a slow rate; they are expected to last for decades; computers depreciate rapidly. So, as investment shifts to computers from buildings, depreciation per $ of investment increases.
On Tue, Jun 13, 2006 at 10:29:59PM -0700, Sabri Oncu wrote: > Michael: > > > > > Sabri: > > > > > Dear Michael, > > > > > > Can you be more explicit? What you mean by structures is not > > > very clear to me. > > > > Buildings. > > Can this have something to do with the capital versus operating leases in > the US? > > Like, many corporations have "sold" the buildings they bought to a bunch of > lawyers who built a shell company and later "leased" the buildings they > actually owned from that shell company. > > But this would slow down the speed of depreciation, wouldn't it? > > Is this not similar to that Citigroup owns the second largest air fleet > after the US air force also decreases the rate of depreciation for the US > airlines? > > What can be the trick here? > > How do Citigroup and these shell lawyer companies depreciate the "assets" > they supposedly own and to what effect? > > Sabri -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail michael at ecst.csuchico.edu
