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Wrong! In reality low rates does not mean more people are qualified for loans. So what happens is more people don't get loans. Or at least many more. Now if you
by roflyear 4y ago
Wrong! In reality low rates does not mean more people are qualified for loans. So what happens is more people don't get loans. Or at least many more. Now if you change laws to make it attractive for people with higher risk to get loans. Or give them loans from the government. Etc... That's different.
- adam_arthur 4y agoMore people are qualified. Refinance a mortgage from 10% to 2%, and what does that do to your cash flow and ability to borrow more? Businesses carry a lot of debt too, and can refinance lower and borrow more. Compare private sector debt levels today vs the 80s
- roflyear 4y agoIt doesn't change the risk profile enough to mean that many more people are getting loans, at least historically. Just because businesses can afford more debt, doesn't mean banks are going to give it to them. This is flawed logic.
- adam_arthur 4y agoThere's a very clear and obvious relationship between prevailing interest rates and levels of debt