Debate House Prices


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Debt is good

Radiantsoul
Radiantsoul Posts: 2,096 Forumite
Part of the Furniture 1,000 Posts Combo Breaker
in Debate House Prices & the Economy
Rising indebtiness is not as many on here seem to believe a sign of moral or economic weakness.

Debt allows people to adjust their spending patterns across their lifecycle and provides a means to allocate capital resources for investment in a more effective way than relying on deferred expenditure. Is this even controversial?
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Comments

  • Generali
    Generali Posts: 36,411 Forumite
    10,000 Posts Combo Breaker
    Radiantsoul wrote: »
    Rising indebtiness is not as many on here seem to believe a sign of moral or economic weakness.

    Debt allows people to adjust their spending patterns across their lifecycle and provides a means to allocate capital resources for investment in a more effective way than relying on deferred expenditure. Is this even controversial?

    Have you any data to show that is what debt is being used for or is that just an assertion?
  • pqrdef
    pqrdef Posts: 4,552 Forumite
    Well, we could all save for our retirements by hoarding gold under the floorboards. But it seems better to put the money where it can be used to do something useful.
    "It will take, five, 10, 15 years to get back to where we need to be. But it's no longer the individual banks that are in the wrong, it's the banking industry as a whole." - Steven Cooper, head of personal and business banking at Barclays, talking to Martin Lewis
  • gagahouse
    gagahouse Posts: 392 Forumite
    Part of the Furniture 100 Posts Combo Breaker
    There is a big difference between self-liquidating and non-self liquidating debt - shame the UK embarked on a non-liquidating debt binge. Probably half of what was bought lies in landfill already, the debt remains and they have no asset from the money spent with which to service that debt.
  • Radiantsoul
    Radiantsoul Posts: 2,096 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    Generali wrote: »
    Have you any data to show that is what debt is being used for or is that just an assertion?

    Just an assertion.

    I am not suggesting more debt is necessarily good, but more that debt is not intrinsically wrong.
  • Generali
    Generali Posts: 36,411 Forumite
    10,000 Posts Combo Breaker
    Radiantsoul wrote: »
    I am not suggesting more debt is necessarily good, but more that debt is not intrinsically wrong.

    Is anyone dumb enough to think all debt is wrong? Pretty much all trade is based on debt for a start. Trade is good.
  • Really2
    Really2 Posts: 12,397 Forumite
    10,000 Posts Combo Breaker
    Debt becomes bad when you use debt to pay debt. Eg increasing debt to service debt.

    Debt is neither good nor bad really but in many ways it is necessary.
  • greenbubble
    greenbubble Posts: 93 Forumite
    probably going to come across as a raving loon to some people , but once you realize we can run a monetary system without having to resort to interest bearing debt , we may actually be free from the money lenders with the added bonus of now having a tool that would hold politicians to account.

    the secret of oz

    http://www.themoneymasters.com/
  • casper_g
    casper_g Posts: 1,110 Forumite
    pqrdef wrote: »
    Well, we could all save for our retirements by hoarding gold under the floorboards. But it seems better to put the money where it can be used to do something useful.

    But hoarding gold under the floor is the opposite of debt. Debt is used to obtain things now and pay for them in the future; retirement planning involves paying now for things in the future.
  • Really2
    Really2 Posts: 12,397 Forumite
    10,000 Posts Combo Breaker
    greenbubble wrote: »
    probably going to come across as a raving loon to some people , but once you realize we can run a monetary system without having to resort to interest bearing debt , we may actually be free from the money lenders with the added bonus of now having a tool that would hold politicians to account.

    the secret of oz

    http://www.themoneymasters.com/

    But saving then also becomes pointless as it will not be interest bearing.
  • ILW
    ILW Posts: 18,333 Forumite
    There is a difference between sustainable and unsustainable debt. I believe the UK are very close to tipping into the latter.
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