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This is simply a wealth transfer to institutions who lent money at low rates prior to the rate increases.

recursivedoubts 4y ago
It is not simply that, although it does ensure that the money that those institutions lent is paid back, rather than defaulted on. But let's be honest: what's really going to happen in the case of defaults is that the banks will seize the real underlying assets and sell them at fire-sale prices to other rich people. The important part is that the borrower is now out from under exponential debt and can get on with their lives, and total debt in the economy is brought down to a sustainable level. Non-debtors get something too: free and clear cash. Is it perfect? No, of course not. Nothing this simple could be perfectly fair. But it is simple, hard to game, addresses the core problem (too much debt) and is probably as fair as it will get, practically. Certainly the elites would scream bloody murder if someone important legitimately proposed it. Keen has been ignored and mocked for years. That's evidence enough for me.
- shjake 4y ago
  It also impossible to enforce. And is basically equivalent to “why don’t we just print more money and give it everyone?”. And anyway a terrible idea.. why do you want to penalize people who have low interest rate mortgages for instance? Anything they’d gain would be offset by inflation…
lief79 4y ago
Good point ... paying down my mortgage faster is a fairly poor use of the funds. However, if it can be used for regular payments or prepayments over a period of time, it's not a bad deal. I'd hope they'd also make exceptions for any loans under the current rate of inflation, but good luck getting that passed. Having to immediately pay off a 0% loan (if anyone still offers those) clearly is far from the optimal use of the money.
- recursivedoubts 4y ago
  People will be incentivized (and possibly required) to pay off high-interest debt first, which is the right thing. Beyond that, a modern debt jubilee isn't about you optimizing your individual financial situation. Rather, it is about: - keeping it as simple and hard to game as possible - reducing total debt in the economy to a sustainable level If you have to pay down or pay off your mortgage, sorry. On the other hand, you would own a house free and clear. So life wouldn't be all bad.
- whateveracct 4y ago
  I'd imagine using it on your next monthly payment would be allowed. Agreed - not a bad deal.

It is not simply that, although it does ensure that the money that those institutions lent is paid back, rather than defaulted on. But let's be honest: what's really going to happen in the case of defaults is that the banks will seize the real underlying assets and sell them at fire-sale prices to other rich people. The important part is that the borrower is now out from under exponential debt and can get on with their lives, and total debt in the economy is brought down to a sustainable level. Non-debtors get something too: free and clear cash. Is it perfect? No, of course not. Nothing this simple could be perfectly fair. But it is simple, hard to game, addresses the core problem (too much debt) and is probably as fair as it will get, practically. Certainly the elites would scream bloody murder if someone important legitimately proposed it. Keen has been ignored and mocked for years. That's evidence enough for me.

shjake 4y ago
It also impossible to enforce. And is basically equivalent to “why don’t we just print more money and give it everyone?”. And anyway a terrible idea.. why do you want to penalize people who have low interest rate mortgages for instance? Anything they’d gain would be offset by inflation…

lief79 4y ago

Good point ... paying down my mortgage faster is a fairly poor use of the funds. However, if it can be used for regular payments or prepayments over a period of time, it's not a bad deal. I'd hope they'd also make exceptions for any loans under the current rate of inflation, but good luck getting that passed. Having to immediately pay off a 0% loan (if anyone still offers those) clearly is far from the optimal use of the money.

recursivedoubts 4y ago
People will be incentivized (and possibly required) to pay off high-interest debt first, which is the right thing. Beyond that, a modern debt jubilee isn't about you optimizing your individual financial situation. Rather, it is about: - keeping it as simple and hard to game as possible - reducing total debt in the economy to a sustainable level If you have to pay down or pay off your mortgage, sorry. On the other hand, you would own a house free and clear. So life wouldn't be all bad.
whateveracct 4y ago
I'd imagine using it on your next monthly payment would be allowed. Agreed - not a bad deal.