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Rolling Jubilee
Posted November 13th, 2012 - 5:17 am from Portland, United States
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Posted November 13th, 2012 - 5:59 pm from Portland, United States
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Posted November 13th, 2012 - 9:25 pm by from Los Angeles, United States (Permalink)
In the first URL listed in this thread there is an article that says the purchase of delinquent debt by philanthropists might cause inflation. Can someone explain why that would be expected?

The same article indicates that the purchase of delinquent debt by philanthropists who didn't demand repayment might be opposed by the sellers of delinquent debt. Does that seem likely to you?

Lloyd

Posted November 13th, 2012 - 9:45 pm from Portland, United States
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Posted November 13th, 2012 - 10:24 pm from Camden, United States
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Posted November 13th, 2012 - 9:41 pm by from Temple City, United States (Permalink)
Cadence,

Thanks for sharing this information. Very intriguing idea. I need a bit more information about the administration of this Jubilee before giving.


Posted November 14th, 2012 - 1:36 am by from Los Angeles, United States (Permalink)
Cadence wrote:

>I can't predict what banks might do to offset their management and sales of bad debt if those debts are suddenly being repaid by non-business non-profit entities who subsequently write them off.
...

>What do you think, Lloyd?


My understanding was that banks don't manage bad debts, and that debt collectors do. I would think that banks would benefit from having philanthropists bid for bad debts as well as debt collectors.

Bankers wouldn't like to see the percentage of people who borrow with the expectation of not repaying the lenders go up, but they discourage that behavior by damaging the credit of people who don't repay them directly, whether they repay a debt collector or not.

If the rate of debt default goes up, the interest rate is likely to go up, and it would be more difficult for banks to lend money at a profit, and for people to borrow.

Does that answer your question about what I think, or were you asking what I think about something else?

Lloyd


Posted November 14th, 2012 - 2:24 am from Portland, United States
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Posted November 14th, 2012 - 3:03 am from Portland, United States
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Posted November 14th, 2012 - 5:32 am by from Los Angeles, United States (Permalink)
Cadence wrote,

>From what you write, it sounds as though you think the banks might start playing chicken with the Occupy debt-forgivers in an effort to maintain control, and (promulgating the myth that people with delinquent debt are somehow morally bankrupt as well) would ignite the inflation/interest spiral to spite such philanthropists for dealing with debt outside of "acceptable" channels.

That wasn't what I thought. I thought that if more people defaulted, costs of lending would increase, and banks would be less inclined to risk lending at low rates as a result. Is that what you would expect to happen?

Lloyd