A handbag away from our debt ceiling

[bijou]

“Mum?”

“Yes, dear?”

“What do you and Dad keep arguing about late at night?”

“You should be asleep. When Daddy and I have our little chats, it’s past your bedtime.”

“Mum, I’m 15 – a bit old for bedtime. Anyway, I usually ignore your arguments but this one seems important.”

“Well, it is important. We are debating whether to raise the family’s debt ceiling.”

“Debt ceiling?”

“It’s the limit on what we can borrow.”

“Doesn’t the bank manager decide that?”

“Yes, ultimately Mr Foss-Smythe can refuse to lend money to us. But your father and I have a different system. For years and years, we’ve taken a solemn vow never to let our household borrowing exceed £500 without both of us explicitly agreeing to raise the limit.”

“So you were arguing about whether to borrow more than £500?”

“Darling, we’ve already borrowed £500,000. Houses aren’t cheap these days, even in Hackney. The point is that your father and I agreed each time we needed to raise the debt ceiling. But now we can’t agree. Your father wants me to cut back on my spending, or he won’t agree.”

“So, what happens if he doesn’t agree?”

“Then we have to ensure that our household debt doesn’t go over £500,000.”

“Fine. £500,000 is a lot of money. Dad has a point. You buy too many handbags.”

“But darling, the handbags aren’t the point here!”

“Aren’t they?”

“Well, perhaps they are a bit. But even if I did stop buying handbags, we’d still go over the limit. Look – ever since I lost my job I’ve been looking for a new one. I’m sure it’s just a matter of time. But until then our income is depleted.”

“So – stop buying handbags, Mum!”

“It’s not that easy. The percentage of household income spent on handbags has been considerably exaggerated by your weaselly father. Far more important is the mortgage. If we stop the payments, we lose the house.”

“But you’re not actually borrowing more money to pay the mortgage, are you?”  ...

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