The fact that someone even tries to sell the asset that has been offered for collateral is reason enough for a lot of people to mistrust someone... for you two it isn't, OK. But for a lot of other people it is (whether you think it is "fair" or "logical" is irrelevant)...
I'd say: "it depends". Suppose someone needs money quickly, and has collateral that's worth much more than what he needs. He can increase his odds of getting money quickly by taking both paths: try to sell the collateral, and at the same time try to use it for a loan. If he's open about this, and mentions this in both threads, I see no problem with it.
In my opinion, a much better option is to add lots of new DT1 members. Current system is an elite system. It needs more DT1 members so it loses its "high status" it currently has while not serving its purpose properly. Current DT1 members are highly inactive, and those few who are responsive are not really into adding more DT2 members, because apparently current DT1/DT2 is very unwelcome against new members. It's an elite club, and it has tribes, and that is not the purpose of DT at all.
To add users to DT1, theymos has to trust them. Since theymos has put much more users on DT2 than DT1, I'd like to believe this is a "trial period" for people he trusts. But then I looked at
Tywill, who is on DT2 (by theymos) and was last active in 2013. I had never seen this name before, although he's on DT2.
I know at least a few users have been added to DT2 this year (myself included), but I can imagine the burden on DT1 to make good choices.
Members can make their own trust lists, and I would wager that most users who have been around here for more than a few months (excluding the signature spammers who probably don't even know what trust is) do exactly that.
I've never changed my trust list. I want to see trust the way most users see it, and I don't think a majority has adjusted his trust list. If you want, you can get a pretty good idea by checking which DT3 and DT4 members have made their own list.
Well you didn't tell us anything new, the DT circle is closed and the only people who are allowed to enter are the ones who leave tons but tons of non valid negative feedback.
Allow me to invalidate your hypothesis by taking myself as an example: I had left "only" 30-ish negative feedbacks when I was put on DT, and I don't think "tons" of those are invalid. Feel free to prove me wrong.