Stazjia’s Commentary

Things look like they’ll get worse

Posted on: October 1, 2008

Well, the financial crisis goes from strength to strength. There are rumours that more British banks are in trouble and might follow Northern Rock and Bradford and Bingley. Let’s hope that the rumours aren’t true.

With just the two that have already hit the rocks, there have been job losses and more companies are in trouble and making staff redundancies. As people spend less, companies are cutting production and more people will suffer redundancy or shorter working hours.

Last night on TV, an expert said that even if there is a rescue plan for the banks, it will take weeks or possibly months for it to have a real effect and much longer to restore confidence to the point where banks will resume lending to each other. Even that might not be on the same scale as before so there will be less liquidity in the system.

None of this sounds like there will be an end to the crisis any time soon.

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