Quote:
Originally Posted by woj
I don't really agree, it makes little difference where the money came from, it's a bit misguided to think that just because it came from the bank there is nothing wrong with not paying it back. We will all have to pay the costs of her defaulting the loan, the ripple effects though very indirect are certainly there.
For example, as the default rate rises, so will interest rates for everyone else, so will number of hoops one will have to jump through to get the loan, etc, heck even the bank employee that approved her loan could lose a job over it, etc....
Though filing bankruptcy may be in her best interest, it becomes a bit unethical when everyone else has to cover the costs of her financial recklessness...  |
Read up on Quantitative Easing - the injection of more money, literally out of nothing, to the tune of trillions, into the economy making dollars worth less - that's costing everyone a lot more than some consumer debt write-offs.
As for interest rates remaining higher than they should, the main reason is greed - banks pay less than ever for money and yet the spread (the % bank pays verses the % they lend for) is larger. It's no wonder banks are still reporting record breaking earnings.
And in regards to the bank employee, they're not going be fired assuming they did what the computer said and followed policy. Anyways, what bank employee still makes important decisions these days? Ok, I suppose maybe at some small, local banks, but most all banks, including credit unions, the lending decision is mostly automated with the employee doing little more than gathering data on the borrower, inputting it into the computer, and proceeding, in accordance with bank policy, with whether to lend or not - the bank employee is not really deciding much of anything, the computer is!