Sunday, October 18, 2009

Government to regulate irresponsible lending!

The news this morning, pre announced as usual is that the government is to regulate against irresponsible lending.

If ever there was a case of bolting the stable door after the horse has bolted, left the farm, and been sold off at market by someone else this is it because lenders are now being very very tight on their own lending anyway. What is more, adding regulation to the situation now may make things worse.

These regulations will not help the many thousands who have been irresponsibly lent to in the past and have either committed suicide or gone bankrupt as a result.

The curious thing is though, that this is a return to how things used to be. It used to be a principle of common law that lenders who lend to people who could not pay it back, and the lender ought to have known that they could not pay it back, lost their money, and quite possibly had to pay compensation as a result. I remember some cases making the news in the 1980's and early 1990's. I wonder which bunch friendly to the banks got rid of that, or if its lack of use is due to the fact that you can't get legal aid anymore.

The BBC has this.