Credit crunch to intensify, Bank of England warns

[GliderGuider]

Credit crunch to intensify, Bank of England warns

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. The development comes in spite of the Government's insistence when it bailed out three of the UK's biggest lenders in October that they would raise mortgage availability back to 2007 levels.

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.

The Bank's Credit Conditions Survey shows that lenders reduced the availability of secured credit such as mortgages to households in the three months to mid-December 2008, adding: "A further decline was expected over the next three months."

That "End of Credit" thread seems less fanciful by the day...

[natrat]

1. the cretins remove cash,wreck economies then swoop in and buy at pennies on the dollar-subhuman

[DJ13]

2. When will governments realize the only solution is full nationalization of banks?

We should not allow private institutions to wreck the economies of the world, and its obvious their requirements to show a profit to their stock owners may push us into a depression.

[Vincardog]

3. Why stop at The banks? What about the parasitic Insurance vampires?

[Hawkowl]

4. Too late

A Bush Depression is unavoidable. Granted the Titanic hasn't hit the iceberg yet, but the iceberg has been spotted and it is too late to turn the ship around. Fiscal stimulus packages take a minimum of 9-12 months to take effect. Compound that with losing 500,000 jobs a month for 9 months and we will hit 10% official unemployment easily. Not to mention the bulk of the ARM's are scheduled to reset this year pushing foreclosures as high as 10% destroying bank balance sheets and further crushing the availability of credit.

Oh yes, the BUSH DEPRESSION is coming and there isn't much you can do to stop it now.