"Indeed, from 1,000 randomly selected firms, those with large loans displayed higher returns not only on their equity but also on their total capital. They were in every respect more successful than the independently financed firms. Then the penny dropped: **unprofitable companies don’t get corporate loans**. Thus, they form part of the ‘equity-only’ group" -- --- **Tags** — [[quotes]], [[survivorship-bias]], [[intention-to-treat-error]], [[will-roger-phenomenon]], [[return-on-equity]], [[return-on-invested-capital]], [[corporate-finance]], **Source** — [[202308101525 — B — The Art of Thinking Clearly]]