Friday 2 January 2009

Credit crunch to intensify, Bank of England warns

Telegraph
"Britain's major lenders have tightened credit availability significantly in the past three months, and intend to make borrowed cash even harder to get hold of in the coming quarter, according to a survey from the Bank of England."...Economists have said the UK is trapped in a so-called negative feedback loop, with the economy slumping further as banks restrict mortgage and other loan availability in an effort to repair their balance sheets. This in turn causes further defaults, which causes more damage to their accounts, and worsening the vicious cycle."
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Prepare for the sequel to the UK bank bail-out
"Instead what we received was a chilling reminder that the financial crisis and the credit crunch have a good way to run yet."

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