[Crusher138]

Your point about business credit is right on.

In my industry we must purchase raw materials to sell. If I sell a $10K order, I will need to purchase $5K in materials. My customer will not pay until done, so I must borrow to produce. Simple.

The reason the home mortgage industry even exists is because it is rare that people could save $100K cash. On the other hand, if there were no mortgages available, would homes still cost $100K?

[cuban leaf]

On the other hand, if there were no mortgages available, would homes still cost $100K?

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That is the problem. Ultimately, credit can be inflationary, especially if your money is fiat. The homes around where my parents now live were, during the bubble, valued at ~$275k. They are now valued at about $160k.

They were built when I was in high school (graduated in 1972). The “loaded” ones were advertised at $17,900.