To me, such a strategy would appear self-destructive and hence irrational. Why would capitalists extend further credit, when they’re already faced with falling profits?

On the contrary its the very nature of profit that ensures an excessive buildup of underutized capital and thence a decline in the rate of interest. Financial intermediaries to whom capitalists loan their idle capital are forced to seek higher risk and therefore more profitable avenues of investment in order to retain their accustomed rates of interest.

This is precisely the point at which the capitalist demands the State to intervene in order to forestall the continued decline in profitability through making investments in capital intensive infrastructure developments, or formenting wars, which are just as effective at dissapating material abundance which is the chief cause of the decline of profitability.

“In a capitalist economy, profit rules. If you deny that, you are denying that capitalism is the right term to describe the modern economy.”

On the face of it, this proposition is illogical, because profit is the product, not the source of capital. Something Marx called surplus value. And today the distinction between worker and capitalism is far more foggy than in Marx’s days since many Western workers have considerable savings, most especially in their pension funds. One could question who is most robbed by capitalist profit, the worker or the consumer. And there is possibly far more surplus value extracted between countries as between social classes. Does one really believe that the sharply diverged incomes of American and Chinese workers relate solely to productivity?

No infact the sequence begins with a phenomonen that Marx called primitive accumulation, where the capitalists create institutional arrangements that have and continue to decisively swing social power in favour of the wealthy relative to the workers. John Bates Clarke, the founder of American neoclassical economics referred to wealth creation as, “the mere appropriation of limited natural gifts ..” and that repelling intruders “is almost the only form of labor which exists in the most primitive social state” (p.10). Those who appropriate them create wealth by so doing.
The essential attribute of wealth is “appropriability,” to create which “the
rights of property must be recognized and enforced Whoever makes, interprets, or enforces law produces wealth” J.B. Clarke, 1886 The Philosophy of Wealth

http://www.masongaffney.org/publications/K1Neo-classical_Stratagem.CV.pdf

Speaking purely in terms of disinterested observation he is right, because it is the power provided by prior legally enforced appropriation, that allows capitalists to demand others produce for them. Money and profit are merely the numeral representation of legal claims over and title to own the former commonwealth (land, water rights, fishing quotas, electromagnetic spectrum, rights-of-way) that have become increasingly expropriated and enclosed over time.