> > It makes perfect sense. Except that many people are
>> inclined to use it more and borrow up to the limit of
>> their capacity to service their borrowings.
>
>So you're saying that the people who can't control their urges should be
>protected from these kinds of things that can radically help whose who
>can?
No, wasn't thinking that. In fact I clearly said that it makes perfect sense to take advantage of cheaper credit. Merely pointing out the economic side-effects of lower interest rates.
> People who blow up credit will do so no matter what's not
>available at the mortgage level. This is like saying that we should get
>rid of steak knives because some people will kill their spouses or
>themselves with them. And hey, some people will use abortion as birth
>control. And holy hell: I just heard about someone who abuses workers
>comp and SSI AT THE SAME TIME.
>
>Let's get rid of it all. Yay.
Like I say, this doesn't just affect the individuals who make use of cheaper credit. I can't help noticing that cheaper housing credit seems to have had an inflationary effect on housing prices, so that the overall price of housing (capital cost+financing cost) has remained just as high. If not higher.
So it isn't about whether individuals should be protected from excessive debt. Its about the macro effect and whether society and the economy needs safeguards against market forces.
Bill Bartlett Bracknell Tas