Tuesday, Feb 16, 2010
Cheap money will be a distant memory
Telegraph: UK house prices 'to slump as credit crunch returns'
The £319bn "funding gap" is the difference between the amount the banks hold in retail deposits and the sum they have loaned. The gap used to be financed in the wholesale markets, which froze in August 2007. They have been replaced with emergency state schemes.
Illustrating the scale of the crisis, CML data shows that UK lenders raised £130bn in the markets in the 12 months before the crunch but just £11.5bn in the past two years. Moody's added that the benign environment of low interest rates and "other Government stimulus [which] have helped borrowers" may just have been "transitory".
Posted by quiet guy @ 08:46 AM (665 views) Add Comment
2 Comments
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1. paul said...
In years to come there will be a public enquiry into how so much money was spent on this.
2. Open Minded said...
The headline is sensationalist and completely misleading. Read the article to get the true flavour of what the 'experts' are saying i.e.
1. "the prospect of a fresh mortgage credit squeeze..." (Capital Economics)
2. "The contraction will put pressure on house prices..." (CML)
Not exactly the return of the crunch or a slump in prices...