Credit CrunchEssay Preview: Credit CrunchReport this essayThe recent credit crunch have left many financial institutions crippled and have left many homeless and millions of jobs have been lost due to the bankruptcy and closure of many firms around the world. There have been numerous articles and publications on the recent credit crunch crises which all state one thing in common. This has been defined as the sudden drop in the overall availability of loans (or credit) or a sudden increase in the cost of obtaining loans from banks. The financial crisis has been the worst in years and therefore has had an impact on the worldwide economy, how the business is carried out. The global overview on the economy looks grim and dull. Many experts believe that the credit crunch could last for a long time.
Once considered as a financially stable country, Greece is now on the edge of having a financial default. With a debt total amounting to an estimated $420 billion, experts say that this debt would have been bigger that the countrys economy itself and this debt is predicted to increase as time goes by because Greece spends 12% more than it gets revenues. So whats exactly went wrong with Greece and how did they get themselves in deep trouble?
According to Mortgage Guide to Credit crunch it “refers to a sudden shortage of funds for lending, leading to a resulting decline in loans available”. Credit crunch generally means that there is little money available to the banks to lend to the customers. There are various reasons that can cause a credit crunch such as high interest rates, shortage of money in the capital markets. But the main reason behind the current credit crunch can be attributed to the failure of the U.S markets which was fuelled by the defaults in the subprime mortgages which eventually spread to Europe and then throughout the world. This snowballed into a domino effect which led to the failure of various firms such as Lehman Brothers, AIG which had to be rescued by the U.S government and the Northern Rock crises in U.K. Fuelled by raising inflation and sky rocketing fuel prices which added to the worries of the common man.
Credit crunchers have a history of making a fortune and are now trying to take advantage of credit weakness that will not only lead to a loss of cash but also to an increase in credit prices
There are some banks with strong financial systems that need to take the plunge as well. A number of the banks in this book use a variety of financial information that is unavailable to others at the same time. I use the term Financial Control to describe banks that have significant financial system, and have many years of financial discipline, including the Bank of America, JPMorgan Chase, Citigroup, Goldman Sachs, Citigroup, United, United Auto Group, UBS, Wells Fargo, UBS Financial Co, Deutsche Bank, JP Morgan and a variety of other financial institutions. These banks can provide loans to customers in the form of mortgages but also can supply customers with loans to purchase the assets which are listed on all of the financial agencies on our site(s). These financial companies are responsible for delivering the financial security to us as we enter economic shock, they operate as lenders, and we offer various services to them.
“We believe that the Federal Reserve is more able to take the economic crisis seriously, and its actions could eventually bring about a financial collapse at the central bank level. However, the monetary policy actions it considers necessary should be gradual, and not put in place until the end of time.”
Credit cruncher
We believe