Kerry:
Thanks for your thoughtful and well-written post. However, I must take issue with your topic statement: "The privilege of debt, when properly and responsibly used, is a wonderful thing. The privilege of debt, when abused, is a terrible and destructive thing."
Why is debt a "privilege?" And if it is a privilege, who gets to decide who receives the privilege and who does not? Raymond? We know he'd like to, budding Mussolini that he is.
The thing about debt is that, like everything else in a free society, it is what it is. It has no moral value, good or bad. Individuals and organizations choose to take on debt, lenders choose to make it available to them. These are free market transactions every one. No-one is forced to make loans or receive them.
Borrowers make bad decisions concerning their leverage, they go bust. Debt is liquidated, the ability of borrowers to borrow again is curtailed, no problemo. Borrowers make good decisions about debt, they increase their ROE. Again, no problemo. |
