4 ms·
You know, consumer debt is probably the biggest thing slowing down the economy, even though financial institutions are wanting to saddle the average consumer wi
by programminggeek 14y ago
You know, consumer debt is probably the biggest thing slowing down the economy, even though financial institutions are wanting to saddle the average consumer with more debt. If people don't have money to buy things because they are spending money servicing debt, that slows down the whole consumer economy. The only people who win in that scenario are the banks, but they would profit more over the long term by a stronger economy than they currently do from consumer debt.
- backprojection 14y agoI think this makes sense from a high-level point of view. It seems like it would be bad for the economy, if more wealth flows from consumers to bank profits. This is maybe simplistic, but I'm thinking progress is better served if more people can buy iGadgets, than if bank execs can spend more on luxury goods. There are huge, positive, side effects when people buy more technology, because technology gets cheaper, which then advances economic growth.
- bradleyland 14y ago> ...even though financial institutions are wanting to saddle the average consumer with more debt. This isn't a rebuttal to your comment specifically, but it illustrates perfectly why bankruptcy ought to be easier and apply to more categories of debt. A lender operates on risk assessment. If provided lending categories where they can saddle debtors with obligation that follows them to their grave, the risk drops significantly. Thefore, in a poor lending market, lenders will gravitate toward lending categories with low risk.