fatvegan

I was reading in the Economist the other day about plans in Britain to make bankruptcy easier. The governments reckons that bankruptcy was too discouraging, and people weren't taking enough risk. But I don't think that the government can reduce make risk-taking easier, without compensating lenders. Because if the governments change the bankruptcy laws, then interest rates will just go up to reflect the higher risks in lending money to people. So you're kind of back where you started. It might make stupid people more likely to borrow money, but clever people are possibly less likely to, because they are less likely to benefit from that friendly bankruptcy laws (because they're smart enough not to go bankrupt), but they still have to pay in the increased interest.

So I don't think it's a particularly good idea.