CDZ People Do Not Buy Debt

[Asclepias]

I was having a discussion about debt and someone made the claim that people did not buy debt. I was amazed that someone would say something like this. Maybe I am wrong? If I am can someone please explain to me why this statement is actually true?

 

[TNHarley]

debt buying is a thing.
China and Japan were buying debt like crazy.
We have companies that buy debt for a profit.

 

[SassyIrishLass]

Buying debt can be profitable and there are companies that do just that.

 

[Fishlore]

Debt is an investment with risk (deadbeat default) and reward (interest). People around the world want to buy US government debt because it is regarded as risk free (looking at you, Mr. Trump) and as a result, the interest paid is very low.

In this situation, the government can sensibly chose to finance its operations by borrowing (US bonds) rather than taxing letting foreign investors etc. pay the costs of running the government and letting the money that would have been raised in taxes in the domestic economy where it may more successfully promote jobs and growth.

This basic debt setup baffles talk radio conservatives because it is a strategy that doesn't work for the family budget. Why? Because credit card interest is much higher than Treasury bond interest. Interest payments on the government debt are currently runnning at 1.3% of GDP. Consumers can't match that and conservatives can't understand it.

 

[Asclepias]

debt buying is a thing.
China and Japan were buying debt like crazy.
We have companies that buy debt for a profit.

What about personal buying and selling of debt? Is that still legal? I'm just making sure nothing has changed.

 

[MisterBeale]

I'm not sure individuals can buy debt, just institutions and governments.

How can the retail investor buy CDOs and CDSs? - Quora

 

[Asclepias]

I'm not sure individuals can buy debt, just institutions and governments.

How can the retail investor buy CDOs and CDSs? - Quora

If I owe a guy 50K on monthly payments and 2 years later he wants to cash out are you saying I cant buy my own debt for less? Say 20K?

 

[MisterBeale]

I'm not sure individuals can buy debt, just institutions and governments.

How can the retail investor buy CDOs and CDSs? - Quora

If I owe a guy 50K on monthly payments and 2 years later he wants to cash out are you saying I cant buy my own debt for less? Say 20K?

Well, that's an interesting way of looking at things. Renegotiating a contract as "buying" debt? Interesting.

 

[Asclepias]

I'm not sure individuals can buy debt, just institutions and governments.

How can the retail investor buy CDOs and CDSs? - Quora

If I owe a guy 50K on monthly payments and 2 years later he wants to cash out are you saying I cant buy my own debt for less? Say 20K?

Well, that's an interesting way of looking at things. Renegotiating a contract as "buying" debt? Interesting.

You wouldnt even have to renegotiate it. He could just sign a doc stating the original debt is paid in full.

Even if you did renegotiate you would be renegotiating the terms not the fact that you have a debt.

 

[320 Years of History]

I was having a discussion about debt and someone made the claim that people did not buy debt. I was amazed that someone would say something like this. Maybe I am wrong? If I am can someone please explain to me why this statement is actually true?

People definitely do buy debt. What the hell does the person with whom you were speaking think investors are buying when they purchase mortgages, bonds or annuities, for example?

 

[Asclepias]

I was having a discussion about debt and someone made the claim that people did not buy debt. I was amazed that someone would say something like this. Maybe I am wrong? If I am can someone please explain to me why this statement is actually true?

People definitely do buy debt. What the hell does the person with whom you were speaking think investors are buying when they purchase mortgages, bonds or annuities, for example?

I dont think the person really understands what those are. They told me a bond was not a debt.

 

[320 Years of History]

I was having a discussion about debt and someone made the claim that people did not buy debt. I was amazed that someone would say something like this. Maybe I am wrong? If I am can someone please explain to me why this statement is actually true?

People definitely do buy debt. What the hell does the person with whom you were speaking think investors are buying when they purchase mortgages, bonds or annuities, for example?

I dont think the person really understands what those are. They told me a bond was not a debt.

Yes, that remark, combined with the earlier one you noted the person made, is what will "seal the deal" on my deciding the speaker is possessed of the "The Imperfect Triumvirate" of personality traits I refer to as "loud, strong and wrong." I just ignore those folks unless before me they show themselves as needing emergency care, in which case I'll call 911 on their behalf, but that's the limit of interaction I'll countenance with them. I just don't have the patience for more than that. More power and props to you if you do.

 

[Fishlore]

debt buying is a thing.
China and Japan were buying debt like crazy.
We have companies that buy debt for a profit.

What about personal buying and selling of debt? Is that still legal? I'm just making sure nothing has changed.

The answer, like everything made by lawyers, is tricky. A debt between to parties is a form of contract. The contract can specify whether the contract is transferable and, if so, to whom and under what conditions. Secured debt, where something of value is put up as collateral for the loan (debt) may also be controlled by the contract. It's all up for grabs.