http://www.cnbc.com/id/27907015 Isn't this the root problem? We have companies and people living off credit? Why would uncle same give more money to credit card issues just so they can put more people in more debt?!? That's like trying to drink yourself out of alcoholism or taking more drugs to cure the addiction. On top of that, we're using borrowed money from foreigners to fund this latest bailout. Paying debt with debt...when will we learn??
Sort of - the problem is mostly debt issued to people it shouldn't have been issued to. But that's led to a situation where credit isn't available to people that are well-qualified and should be able to take on debt. Having more credit available as long as we have stronger lending standards is probably not a big negative problem.
It's a separate problem. Right now, I think they don't want (1) people to spend less and contract the economy and (2) people to forego investing in themselves to improve future productivity. I think they figure we'll have to tackle the overborrowing issue later.
I consider it very much linked. I can understand that student loans is a investment for future productivity, but that debt is a blip compared to the massive credit card debt Americans have accumulated. The Govt is overborrowing so they can allow Americans to overborrow to pay for stuff they don't need. WTF kind of logic is that? We got into this mess because our economy was running on debt. So now a debt crisis occurs and we try to solve it by borrowing more money! When will we learn that we need the economy to contract and cool because we pumped it full of hot air in the first place.
