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Comment by Macross8299 | Hacker News Reader

Unpopular opinion: someone who welches on their debt SHOULD have their reputation blackened for a reasonably long time.

When you default on your debt, it makes it much much harder on everyone else in the system. All other things being equal, your creditors (and their depositors) have to either accept lower interest rates as result of your irresponsibility or the other debtors have to be squeezed (1+1/n) times as hard, where n is the number of remaining debtors.

I am glad this cross-border credit reporting is becoming a thing, if anything.

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The only way I could agree with you would be when speaking about a reasonably intelligent, healthy individual not living where health is a bankruptcy lottery. As it stands now - and I apologise if I completely misunderstood a poorly written comment meant well - your comment sounds like coming from a Martin Shkreli-like sociopath.

"To welch on one's debt"[0], if I have to believe the Merriam-Webster diary, means to avoid payment, and has gained an offensive connotation. You might want to be more careful about your use of language describing such a sensitive subject as debt.

Defaulting on one's debt is not necessarily due to irresponsibility. People sometimes have really bad luck for example. Or they're just plain stupid, with insufficient regulation in place to protect them from their own limited intelligence.

One might also want to look at the context of borrowing, from a human perspective. I'll give just one example.

The lender side of the equation. There's plenty of irresponsible lenders, often with far too little regulation. My native Belgium has some interesting lending regulations:

* All loans taken by individuals are gathered in a database run by the national bank.

* Lenders are legally obliged to check the lending database before offering a loan, in order to assess the risk. If they don't, or if they recklessly extend a loan, the borrower can legally walk away from it.

* Lenders are required to obey strict APR limits [1], or they risk the borrower legally walking away with the principal, and without interest payments.

[0] https://www.merriam-webster.com/dictionary/welch [1] https://economie.fgov.be/nl/themas/financiele-diensten/consu...

Not sure about the whole sensible-topic thing, but:

I think the reason why our parents opinion is unpopular is because people usually account for diminishing marginal returns by acknowledging that the loss of utility one person experiences paying 1 is greater than the summed up loss of utility of two people paying 0.5 each, even if all three people are equal.

I think you're right in making clear that not paying what you owe doesn't need to be ones fault and can happen through inability, bad luck, etc.

Reputation, however, doesn't imply fault. Bad luck is evenly distributed and inability should be reflected in reputation to work as intended.

Regarding the policies you list: I think enforcing some responsibility regarding loans is a good thing, but:

The idea that there's a central, state run individualized debt database does not sound like a particularly great idea (thinking of system resilience, surveillance and potential leakage).

Thank you for your comment.

"I think the reason why our parents opinion is unpopular is because people usually account for diminishing marginal returns by acknowledging that the loss of utility one person experiences paying 1 is greater than the summed up loss of utility of two people paying 0.5 each, even if all three people are equal." This sounds like an interesting comment, but I'm not sure I understand you 100% right. Could you please elaborate?

"Reputation, however, doesn't imply fault. Bad luck is evenly distributed and inability should be reflected in reputation to work as intended." Totally agree.

"The idea that there's a central, state run individualized debt database does not sound like a particularly great idea (thinking of system resilience, surveillance and potential leakage)." You certainly have a point there. Of course, then the question becomes how to better reconcile system resilience, protection from surveillance and leakage. Any suggestions?

well, well, well. Debt given with an APR has a certain rate of default built in (minus cost of money to the bank, expenses, inflation and x% profit). It's very different from grandma giving you $1000 as a loan.

Scenario: you take a credit card with 11.9% APR. It goes to 14.9% after a year. You miss the payment by a day and it jumps to 23.9% or 29.99%. F them, if you could.

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