A bank comes along and offers the family cheap credit. The family figures that if they take the credit, they need to work a lot less and can still afford the same standard of living. They could even increase their standard of living. So, they take the credit and start spending money on other things than the ones they really need. And they work a lot less.
The family does all of its buying at a shopping mall which belongs to the bank.
One day, the bank informs the family that they have reached their credit limit. After long discussions, the bank agrees to extend further credit. It obviously helped that the shopping mall intervened on the part of the family because they didn’t want to lose their business.
What should the bank have done instead? The bank should have told the family that they had to start running their farm again. The family might have said that they no longer had the tools and know-how for it in which case the bank should have made a loan, but only for that purpose.
So the family could again run the farm and support its own living standard. There are only 2 problems: the living standard is much lower and, then, there is still this debt which had been accumulated.
Again, the bank could play a meaningful role. It could “brainstorm” with the family how they could raise additional money. Perhaps a couple of the family members could get a job outside the farm. Perhaps they could rent some of the farm to tourists. Perhaps they could even sell some of the property.
One way or another, the family would have to understand again that they needed to work hard and smart enough to generate enough income to support their standard of living and to service their debt.
Who would lose if the family had to reduce their standard of living? You guessed right — the shopping mall!