If low interest rates encourage lending then why aren't the banks lending out mortgages?

In the Keynesian economic model lowering interest rates should encourage borrowing but what if the banks refuse to lend to you? Why should the banks lend to you when you are at high risk to default on your loan and they aren't getting much interest for that risk? You do realize that banks look at what... show more In the Keynesian economic model lowering interest rates should encourage borrowing but what if the banks refuse to lend to you?

Why should the banks lend to you when you are at high risk to default on your loan and they aren't getting much interest for that risk?

You do realize that banks look at what kind of job you have and if you are able to pay your bills. They also want collateral just in case you do default that way they don't lose all their money. Banks can't rely on rents since Democrats have made it so easy for tenants to default on their rent payment and still remain inside the house or apartment. So that is out of the question.

Neither can banks rely on the stock market since its so volatile. Today its up 200 points and tomorrow its down 200 points. So why should banks risk giving you a loan that pays them peanuts in interest when you are very likely to default?
Update: @Texas Pete- If people spend all their money won't it go to the elite who do all of their manufacturing outside of the country to avoid paying taxes? So from what I can see is that you just admitted that your system is a system of theft. Its taking from the middle and giving to the rich. I thought Obama was... show more @Texas Pete- If people spend all their money won't it go to the elite who do all of their manufacturing outside of the country to avoid paying taxes?

So from what I can see is that you just admitted that your system is a system of theft. Its taking from the middle and giving to the rich. I thought Obama was for the middle class. What happened?
Update 2: @"Get a life."- A lot of babble there but it still doesn't explain why banks won't lend you their money and come to think of it why should they. Another thing you left out of your simple minded explanation hoping to confuse me and others by rambling on and on with your "anal... show more @"Get a life."- A lot of babble there but it still doesn't explain why banks won't lend you their money and come to think of it why should they.

Another thing you left out of your simple minded explanation hoping to confuse me and others by rambling on and on with your "anal retentiveness" (look it up) is that you didn't explain to me how you can have economic growth when most of our manufacturing is in other countries. In essence by encouraging spending you are stealing our wealth and handing it over to people who outsource their companies and hide their money in offshore accounts.
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