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The Credit Cruncher


Published on

The Credit Crisis Crunched in 30!

Published in: Economy & Finance, Business

The Credit Cruncher

  1. The Credit Cruncher esenta tion by A pr Michael Eury
  2. “The economy will never stop growing.........”
  3. Anyone can buy a house
  4. Subprime mortgages = greater risk of default a history of bad loans or defaults, those with a recorded bankruptcy, or limited debt experience
  5. Sub-prime Sub-prime mortgage Sub-prime mortgage mortgage Sub-prime Sub-prime mortgage mortgage
  6. Bankers named these “Collateralised Debt Obligations!” Note: Earlier name, “Worthless Junk”, was less popular with investors
  7. A A A rigorous analysis by ratings agencies
  8. US investment banks are prime movers in these transactions (‘possibly’ not a real banker)
  9. Banks, governments, businesses around the world bought these ‘rock solid’ assets
  10. And on it went.......
  11. Debt assets Debt assets Debts
  12. Until one day, when........
  13. Honeymoon periods on sub-prime interest rates ended
  14. Mortgage holders couldn’t pay the higher interest rate
  15. ...instead of house $ outweighing the mortgage....
  16. $ are greater than a house’s worth!
  17. for the unknowing buyers of the Junk assets.... values and financial returns.....
  18. are washed away
  19. up to 100 US mortgage lenders close down and....
  20. Value CDO’s (Junk assets) !!
  21. Established investment banks become insolvent with a great risk of more to come!
  22. Commercial confidence plummets
  23. US Federal reserve launches $700b ‘rescue’ package
  24. Stockmarkets crash
  25. no longer confined to the US
  26. it’s now more like this!
  27. (and politicians) Economists don’t quite know what to do “I’ll count to 10, then everything will be all right!”
  28. “Whoops, forgot to cross my fingers! I’ll try again. 1, 2, 3.......”
  29. website launching December 08 - bookmark it now!