A "poor bullet" isn't totally ineffective, just not very good.
I didn't say "without assuming debt." I said "ways that don't involve taking on *masses* of debt." (Emphasis added).
My point was that it can be done without sinking yourself in a morass of debt. Even something as simple as paying your utility bills on time each month builds credit rating.
^^^^^^^^ Watch out for this word "apparent". Credit isn't *really* inevitable in the US or anywhere else. It may be everywhere, but it isn't
*inevitable*. It's not hard to take on little or no debt, but doing so does mean being prepared to make sacrifices - such as buying things next month or next quarter, when they can be afforded, rather than today, when the debt mountain must be built higher.You think that it won't help the borrower to stop taking on more debt?
Not at all. The discussion continues on from my original assertion that the debtors in the examples did it to themselves, and that nobody put a gun to their heads (figuratively) to make them borrow. Digging your heels in and refusing to take on more debt is definitely relevant to such a discussion.
This all hinges on exactly how you interpret "expect" above. They "expect" repayment, in the sense of "anticipate", but allow for the fact that people sometimes do not, for various reasons. Nobody puts special terms in contracts to deal with the times when everything's going well, so of course the contract looks unbalanced. Everybody knows that lenders lend for profit, and they aren't responsible for the fact that borrowers cannot manage their own finances.
Read on, maybe you'll see an answer.
That's not actually what I said. I meant that old-fashioned idea of living within your means. If you can afford to take it on, fine, otherwise don't do it. I have fairly strict view of "afford" in this context, meaning living within your budget, but I wouldn't go so far as to allow only cash transactions.
Note that where borrowing is at a variable rate of interest, the borrower must be careful to ensure that he will not be over-extended if the rates increase. This means reading the small print, and not taking debt on if you don't like the terms. For instance, here in the United Kingdom, banks offer overdraft facilities. I don't use mine except in dire emergencies, because the terms of the facility allow the bank to call it in at any time. I don't want to expose myself to that kind of risk, so I make sure to keep a credit balance in the account all the time.
I would argue that the people who have over-extended themselves have dealt the hand to all of us.
They didn't borrow money like it was going out of style? Without the consumers borrowing money like this, the banks couldn't have created the monster.
No, the consumer maintains the monster with instant-gratification borrowing.
A more responsible attitude to borrowing money, as I suggested, would go along way to ending this situation.