How risky debt became ordinary: A practice theoretical approach

Critical Sociology

This article uses the United Kingdom as a case study to explore the limits of financialisation. It makes visible the increasingly intimate relationship between financialisation, indebtedness and social reproduction under the conditions of neoliberal austerity (Fraser, 2014). It does so by unpacking how the everyday experiences of indebtedness materialise among individuals, households and communities. Specifically, we investigate debt’s significance within the household economy by analysing the everyday talk within ‘debt threads’ from leading peer-to-peer forums (Stanley, 2014, Stanley et al., 2016). The evidence reveals how debt interferes with and disrupts the intimacies of life, and in doing so erodes its own moral economic claim as a priority obligation within the household economy. These are the limits of financialisation because if debts are not ‘cared for’ they are non-performing. And, non-performing loans – as it turns out – cause catastrophic failures in financialised global...

Journal of Consumer Research, 2011

This research develops a theoretical account of cultural meanings as integral mechanisms in the normalization of credit/debt. Analysis derives these meanings from the credit/debt discourses and practices of 27 white middle-class consumers in the United States and tracks their negotiation in patterns and trajectories in social and market domains. Discussion elaborates the ways informants normalize credit/debt in transposing their categories, in improvising meaning combinations, and in suturing the meaning patterns to particular subject positions in constituting themselves as consumers. Theoretical contributions (1) distinguish consumers’ collaborative production of cultural meanings with friends, family, and others in the social domain and with financial agents and institutions in the market domain and (2) document the productive capacities of these meanings in patterns and trajectories in configuring people as consuming subjects. Implications situate such cultural reproduction proce...

2009

Although consumption studies now dominate large areas of social and cultural research, relatively little attention has been paid to the consumption of financial products and services. However, the consumption of mortgages moved to centre‐stage in the early twenty‐first century, as products that were once tightly rationed were more actively sold, and households were faced with an unprecedented array of borrowing options. Drawing from qualitative telephone interviews with a cross‐section of 150 UK home‐buyers, this paper explores the way households in a credit‐rich setting choose and use their mortgages. We argue that, notwithstanding the risks commonly and rightly associated with the financialization of domestic space, mainstream borrowers are often “at home” with their mortgage: they can generally navigate the mortgage maze and put their mortgage to work.

Journal of Cultural Economy, 2018

This article contributes to the understanding of how first-time buyers and their parents form attachments to housing debt. Interviews, carried out in the Czech Republic, with 40 first-time homebuyers and 10 with their parents were used to identify multiple layers of debt performativity. These layers consist of statements expressing moral evaluations and emotions; calculative and cognitive devices; and references to practices. Two arguments are advanced through a framework of layered performativity. The first argument concerns the subjectivities of debtors. Debtors adopt investment concepts in their statements and use calculative devices. However, by relying on familial moral orders of security and familial financial transfers, these debtors must be regarded rather as semi-financialised subjects. The second argument relates to the re-configuration of social and economic relations in families. Debt attachment endorses the use of intergenerational financial transfers, which in turn may enforce continued intra-familial reciprocity, both in terms of the recipients’ obligation to the providers of a gift or loan as well as concerning an obligation to help their children attain homeownership in the future. Finally, intergenerational transfers also transform the character of the mortgage market and mortgage debt, making informal debts an important part of formal debt circuits. Limited free download of the article available here: https://www.tandfonline.com/eprint/pyHTnKttSn3UAupc73vD/full

Indebtedness as a global phenomenon has attracted much attention both in public discourses and in academia in recent years. In Hungary, however, up to date social scientists have not paid considerable interest to studying debt. Drawing on long-term ethnographic fieldwork in rural northern Hungary, in this article I explore the financial portfolios of the poor in two settlements and their debt relations. I attempt to show how different forms of debt (formal and informal) are used, perceived, and valued; what kinds of different meanings are attached to them; and how they interrelate to each other. I will show the magisterial juggling of the poor with income scarcity, and the wizardry with which they make a living on twenty-two thousand forint (60 $) a month, the Hungarian equivalent of the " $2 a day " global poverty benchmark. I will attempt to shed light on the role of informal moneylending in this puzzling story. I will explore how the cash-poor invent new ways (by appropriating and adjusting established ones; among others, subprime lending) to generate regular income. Whilst comparing the practices of formal and informal financial institutions towards the poor, I argue that informal/'illegal' lenders fill the gap, the economic niche, left empty by formal/legal financial companies, to " bank the unbanked ". Through this process, however, old dependency structures are reconfigured, new patron-client ties are formed and community wealth is redistributed – to further impair the poorest of the poor.

Competition & Change, 2019

This article explores how financialized subjectivities have been performed in household economy manuals under two successive socioeconomic regimes in the former Czechoslovakia and the current Czech Republic: state socialism and neoliberal capitalism. Drawing on a layered performativity framework, we studied how rhetoric, devices and instructions used in manuals construct households into self-reliant actors who embrace financial products. We found that subjects were already being financialized by the manuals of the socialist era, particularly those from the 1980s. The main change concerned the treatment of temporality and the occurrence of calculative devices. Our findings challenge the idea that financialization has emerged under the regime of neoliberal capitalism and implies that financialization is part of a longer trend in modern economic governance.

Finance and Society, 9(2): 21-38, 2023

The quest for social status is usually considered one of the main drivers of the demand for consumer credit. This article provides a nuanced take on consumer credit by exploring the interaction between consumption, borrowing, and class identity. To do so I pursue a cultural class analysis inspired by the work of Pierre Bourdieu. Drawing from 26 semi-structured interviews, the article has two main findings. First, it shows that people engage in borrowing not only to gain prestige, but also to assert their belongingness to symbolic groups, which embody the values of imagined communities. Second, against the idea that borrowing is undertaken mainly for conspicuous consumption, the article's findings show that middleincome families in Chile borrow to consume 'ordinary' goods. Through the consumption of these goods, the Chilean middle classes seek to stabilize their class identities through their life trajectories, thereby achieving a sense of place in a changing environment. These findings lead me to focus on the normalization of credit and the process through which borrowing practices turn consumer goods from wants into needs, ratcheting up the demand for credit. The article argues that this is an overlooked way in which competitive dynamics drive the demand for credit, which is a missing link in the explanation for the rise of household debt.

2013

This paper assesses the relevance of mortgage-led consumption for the assemblage of home. Drawing on qualitative research completed in the UK, we show how the materials and meanings of owner-occupation are constituted by, and experienced through, the accumulation and deployment of secured debt. This is enabled by a particular financial regime, in which the proceeds of equity borrowing are freed for discretionary expenditure. Homes and their contents thus acquire the status of “debted objects”, and these form an interface between the financial and familial values comprising residential space. By attending to these mortgage-enabled purchases, we expose and evaluate the myriad ways in which equity borrowings animate the assemblage of home, adding value to property, linking domestic space with distant geographies and inspiring the art of dwelling.

City Analysis of Urban Change, Theory, Action , 2023

The paper outlines the causes, unfolding and outcomes of the boom and bust of Swiss franc (CHF) loans in Serbia with a focus on their relation to class mobility in the setting of a transition to the market economy that transformed the methods of housing acquisition. This process resulted in an extreme housing precarity and declassing for segments of the post-Yugoslav middle and working classes, which has manifested in their dispossession of secure housing, savings, pensions, and the sense of having social security, working towards one's own house and building a family. We demonstrate how besides contributing to declassing, housing precarity played a significant role in rendering CHF-indexed housing debt an opening that activated individual and collective strategies of resistance. Resistance by debtors, and its articulation in the public sphere, relied on multiple logics and tactics-from appeals for existing laws to be respected, to demands for a legal codification of the right to home, to the physical prevention of evictions. These sometimes contradictory and competing logics reflected varied social and economic positions of debtors with their related moralities as well as corresponding different reasonings on acquiring housing, social mobility, and approaches to the financialization of everyday life. By combining the analysis of debtors' personal narratives, public discourses, and the political economy of dependent financialization in Serbia, we flesh out the connection between financialization, housing, ideas about social mobility, post-socialist transformation and declassing. The article reveals how and why predatory loans in post-socialist conditions lead to declassing through precarity and new forms of collective action.

The aim of this paper is to address a particular aspect of the financialization of domestic economies: how mortgages taken out by ordinary people as they intend to become home owners have been the object of securitization processes, that is to say, they have been used by financial institutions to issue sophisticated financial products -derivatives such as mortgage backed securities-that are then sold to international investors. This seemingly esoteric process takes place on the abstract arena of financial markets. Nevertheless, it has crucial consequences for people's chances to secure their livelihoods and to pursue their life plans, as it is anchored on a material resource: housing. Financial processes have thus become involved in the satisfaction -or the lack of satisfaction-of a human need.