>> Access to fresh capital was was being denied to even worthy borrowers. <<
Bulls--t. What a crock.
>> That's not a condition that can be tolerated or withstood. <<
Your assertion is overblown and exaggerated. There was no serious credit crunch in America.
Craig, while I agree that a couple small rate cuts have not solved, nor will they, the problems in the US and World economies, I do think we are at the beginning of a credit crunch. Of course, these small rate cuts won't cure that ill either. The reason we are having or will soon have a credit crunch is simply that it's a natural reaction of banks (and other lenders), when they are taking large losses from any source, to become overly cautious on new credits. With the losses already disclosed on Asia, Russia and hedge funds as well as potential additional losses from Latin America and from other hedge funds, I'd imagine new credits are very difficult to get approved now. If this is happening, it will take time, not just small rate cuts, for lenders to start lending again.
JMO,
Bob |
