THREE

The Dark Side of Borrowing

Good old John Sedley was a ruined man. His name had been proclaimed as a defaulter on the Stock Exchange. . . . The house and furniture of Russell Square were seized and sold up, and he and his family were thrust away, . . . to hide their heads where they might.

William Makepeace Thackeray (1811–1863), Vanity Fair

DEBT IS A PROMISE. After debt is put in place, borrowers and creditors must deal with it. Sometimes the burden imposed by the promise is too difficult or impossible for the borrower to bear. This is true for the debts of individuals and businesses, and sometimes also for government debt. The burden of the debt can cause problems for both borrowers and lenders, and sometimes also for third parties.

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