But in the borrower s view it is usurious taking advantage of the borrower s desperation.

Low interest rates strengthen the ability to pay, and thus boost demand.

Commercial debt usually has covenants that limit the borrower s ability to roll the dice.

When prices are rising, the real interest rate is less than the nominal rate since the borrower repays with dollars that are worth less.

As long as the borrower has not misled the lender at the time of taking the loan, the lender bears at least some responsibility for the transaction.

Loan or bond covenants often require borrowers to agree to maintain a minimum level of equity capital or cash on hand.

Similarly, private borrowers can go to prison if they misrepresent their financial condition to secure bank loans.

The borrower typically requests loans when it needs to purchase and manufacture inventory, and repays the loans when the inventory is sold and the sales price is collected.

After all, if they defaulted on their loans, the banks would repossess the house at a higher value.

But there is a contrary moral attitude, the essence of which is that, whereas excessive debt is to be deplored, the blame for it lies with the lender, not the borrower.

Notably, the issuer, that is the borrower, can rationally plan such borrowing to make real investments.

Consider catastrophe bonds (or cat bonds ), which contain clauses that stipulate that the issuer of the bond (the borrower) does not have to repay the money if a specified catastrophe occurs.

It will be as with the people, so with the priest as with the servant, so with his master as with the maid, so with her mistress as with the buyer, so with the seller as with the creditor, so with the debtor as with the taker of interest, so with the giver of interest.

And it shall be, as with the people, so with the priest as with the servant, so with his master as with the maid, so with her mistress as with the buyer, so with the seller as with the lender, so with the borrower as with the taker of usury, so with the giver of usury to him.

The collateral limits the lenders downside risk, and the fear of losing the pledged assets encourages borrowers to act prudently.

Research has revealed that on the comparatively small area of the mountain there are 1,500 species of higher plants, 500 species of fungi, 500 species of algae, 326 species of mosses, and 200 species of lichens.

Moreover, because financial institutions assets were bought mainly with borrowed money, the shortage of credit is exacerbated by their need to deleverage.

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And we thought this was a very interesting comment on America, and a kind of self serving, not my responsibility kind of phenomenon.

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Nor do these official responses to the crisis envisage limiting the amount of loans to some multiple of the borrowers income or some proportion of the value of the property being bought.

But the theory of usury survived in the view that it was morally wrong to extract some additional amount that was made feasible by the borrower s weak bargaining position or extreme need.

It's sort of like sobering up.