The bankers created the "personal" debt mess?
Fear! Uncertainty! Doubt!
Fiat money!
Run away!
Who do you think pushed to loosen up lending guidelines to allow high-risk people to have credit cards? Before this insanity got started in the 80's the US personal bankruptcy rate was a fraction of what it has been in recent years. College kids get credit cards now when in my parents time only well-off people had credit cards and then the balances HAD to be paid off every month. There was no such thing as revolving debt. The bankers did, indeed, create this mess and they've been reaping amazing profits by giving credit to irresponsible people.
Before you say that it is the responsibility of the borrower to behave themselves I'll remind you that it is the fiduciary duty of the bank to be responsible with my deposits and to not lend them out to high-risk borrowers with low credit scores.
So, as I said, the bankers created this mess, now let them pay the piper.
in part yes, because absent government regulation - they created instruments like interest only mortgages, 40 and 50 year mortgages, being able to borrow for amounts greater than the assessed valuation of a house, etc. and let's not even talk about credit cards.
yes, they don't force anyone to take those loans or run up charges on their cards. but these practices, spread across a large society of undisciplined sheeple, inevitably will lead to big problems regarding debt.
Yes, by granting credit to the non-credit-worthy, allowing them to rack up large debts and then raising interest rates to 25% on the unpaid balance. This makes the debt grow faster, and causes severe difficulties in making payments, which then result in huge penalties. Yes, they cause the mess because they have a product that they can sell for one price and then change the price after the sale. And there are no laws preventing them from doing so. Except the bankruptcy laws.