3 ms·
It encourages borrowers to borrow possibly recklessly. It doesn't encourage lenders to lend recklessly (they won't make any money for the credit risk). Of cou
by lucozade 12y ago
It encourages borrowers to borrow possibly recklessly.
It doesn't encourage lenders to lend recklessly (they won't make any money for the credit risk).
Of course, that won't stop anyone from lending recklessly any more than rationality did last time around.
- jrs235 12y ago"It doesn't encourage lenders to lend recklessly (they won't make any money for the credit risk)." As long as lenders are Too Big To Fail and therefore don't take on the full risk of their lending decisions why wouldn't they continue on the private profits/rewards and public losses/risks trail?