I think you'd agree though, that only the initial borrowing is a voluntary transaction.
Thereafter, the actions of the banks and the vagaries of the financial markets etc. are outside the control of most of us.
Unfortunately, no-one ever has "full information", which is why the economists' favourite, the so-called "perfect market", is an unachievable fiction.

At the end of the day we're at the start of an adjustment. Probably 10 + years of so-called de-leveraging. By the end of that we'll have house prices, etc at about half of current levels in real terms and real family incomesdown dramatically. In o9ther words the debt fuelled frenzy will inevitably unravel and people will be back to roughly where they were before the frenzy. So in a longer time frame there is no problem. In the shorter term the pain could be enormous if governments and central banks fail to rig the markets to spread the pain over a decade. If they don't then we'll have banks and country's going under and there will be mayhem on a scale most of us cannot imagine. Worrying about the abstract will be the least of Legionnaire's and our problems.

Who has stolen Dally's login ID?
Come on, own up.


Phew, it's Dally all right.

That's true its outside most people's control but part of the voluntary transaction is that both parties accept some risk. The mortgage lender accepts the risk that the borrower may default. The borrower accepts the risk that the interest rate may vary or if he wants to insure himself from the risk, sign up to a fixed rate mortgage.

In fact in terms of mortgages a lot of people have benefited by paying lower mortgage rates than expected in recent years due to the low interest rates.

I think in terms of mortgage slavery the bigger problem is the shortage of supply of housing that is driving up house prices and meaning owners of property have a huge advantage in being able to make money off those that don't own property, because everybody needs somewhere to live.

... on the basis that if it goes pear shaped, the taxpayer will stump up a billion or two to see them right; the bankers can sack a few thousand staff to look as if they're doing something, and continue to trouser obscene pay packets. Trebles all round. Some risk.

But that shortage in supply, what is the root cause?
Builders aren't building, but that's not the cause, that's a symptom.

The cause is the fact that first-time buyers (on whom the whole structure depends) can't get mortgages.
If they could get mortgages, builders would be building homes a whole lot cheaper than the existing stock is currently selling for.
One thing that Dally did get right is that house prices will erode but IMHO that will be slow.

Cameron says that it's planning regs and process that are the problem.
But Cameron is a lying n0bhead who wants to help the likes of Tesco to build on land they have stockpiled.

The last thing the BoE and Government want at the moment is a big increase in housing supply. Policy is aimed at trying to keep property prices artificially high for the medium term.

There is some very confused thinking on here. People bemoan the fact that we got into a mess due to credit being freely available and most policy suggestions involve growth via further deabt but at the same time bemoan the fact that mortgages for first time buyers are not given away!

But we appear to have gone from a situation where money was being thrown around, to one where it's kept under lock and key and nobody can have any. I guess banks have never heard of a happy medium?

They have no choice. Things went wrong now they need fixing. If we take, say, a 25 year period - previous 15 years and next 10 you will probably see there was a happy medium on average - just dramatically skewed between the first and second half of that period.

That average will really help businesses who are struggling to get finance to expand and boost growth. 2.90478515625:5