chud wrote:LOL at Teazer's double-speak..."collateralized revolving loan's"...debt is debt.
Yes, bank loans are also a form of debt. Most small to midsize companies rely on bank loans rather than other forms of debt for such spending. Public debt is too costly at that scale and takes too long. Private debt is unlikely to be used for most working capital needs or payroll since it is unpredictable as a source of funds, though it might be used for investments like opening a new store. Bank loans are often in the form of a flexible (ie "revolving") line of credit collateralized on the company's inventory, accounts receivable etc. i.e. a "collateralized revolving loan", "asset backed line of credit" or any of a bunch of names. An alternative is, as you say, just retaining earnings within the company to fund working capital and investments, or hold as cash, which some companies choose to do, particularly if they don't mind slower growth.
Since the diatribe ommits such choices, let's leave it that the person in the story is either being a monumental dick or he's faking the financial health of the company. Neither should be the basis of sound public policy decisions.