credit report comparison

Question by trevathantim: How are they defining ‘Credit Crisis’ here?
http://www.risknews.nett/public/showPage.html?page=862163Risk News: General NewsCredit crisis did not start until October 2008, Fed research finds11 June – New research from the US Federal Reserve Bank in St Louis, Missouri, has found US banks did not begin to cut credit significantly until the last few months of last year, more than 12 months after the generally recognised start of the financial crisis.Although the subprime mortgage crisis started in mid-2007, real estate, commercial and individual brought continued to expand until the third quarter of 2008, albeit at a slower placed, wrote economists Silvio Contessi of the St Louis Fed and Johanna Francis of New York’s Fordham University – reports from US commercial banks “do not demonstrate open signs of distress in the commercial and industrial loan segment of the banking industry, at least through the end of September 2008″. Meanwhile, falling mortgage rates through most of 2008 meant existent estate imparting continued to turn as borrowers refinanced being mortgages.The picture merely changed in the fourth quarter of last year, when net credit contracted aggressively – largely the result of lower lending at the country’s largest banks, either because of tighter credit standards or lower demand. “The relatively smaller banks show little impact from the recession that began in 2007. Their credit growth was positive and comparable to, if not larger than, previous years,” the study commented.The study also found increased use of previously arranged ascribed lines, suggesting 2008 saw a drop in new loans arranged that was masked by the tapping of credit facilities arranged before the start of the crisis. Credit was also becoming more difficult to obtain from other sources such as syndicated loaned and commercial paper issuance, prompting commercial borrowers to rely more on banks. In the fourth quarter, credit contracted at a rate last seen in the 1990-91 recession, Contessi and Francis wrote.This does not bode well for the recovery of the financial markets, they add, draw on a comparison between the current recession and five recent recessions. The early stages of this recession looked similar to the 1980 and 1981-2 recessions in the US, implying a rapid recovery in credit, but “in the 1991 recession, however, the decline in credit expansion and the increase in contraction were persistent, permanent for two years into the recovery”. The authors added: “It is possible farther quarterly data will reveal a creditless recovery”, in which credit remains difficult to obtain level after the economy starts to grow again.See also: US Congress: Banks may need more stress tests Banks repay $ 68bn in Tarp funds to US Treasury FSA stress tests banks for four-year downturn Defaults to rise as IMF predicts slow recoveryAlexander Campbell

Best answer:

Answer by Professor Chris
Credit Crisis = Stealing money from The People for the benefit of the establishment.

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