Banks getting much stricter on loans

[katty]

more:
http://www.marketwatch.com/news/story/banks-putting-squeeze-credit-fed/story.aspx?guid=%7B7BE04142%2D569B%2D4889%2DAC74%2D4F30FA124B59%7D

Banks getting much stricter on loans, Fed says

By Rex Nutting, MarketWatch

Last update: 2:18 p.m. EST Feb. 4, 2008Print E-mail RSS Disable Live Quotes
WASHINGTON (MarketWatch) - Banks are putting a stranglehold on credit, the Federal Reserve reported Monday.

Banks are raising their credit standards for mortgages, consumer loans and commercial real estate loans at a pace never seen in the 17-year history of the Fed's quarterly survey of senior bank loan officers, the Fed said.

Plain-vanilla business loans were also much harder to obtain, the Fed said.
Banks expect more delinquencies and charge offs for most types of loans to consumers and businesses, the survey said. Banks said they were tightening their lending standards in response to weaker economy, reduced tolerance of risk, and decreased liquidity in secondary markets.

The survey backs up the Federal Open Market Committee's comments last week that credit conditions had tightened considerably, a factor that led to the FOMC to slash interest rates by an unprecedented 125 basis points in two weeks.
The Fed remains worried that credit is getting too tight after years of loose standards.

[sinkingfeeling]

1. Good. Should go back to the 'old' rules about income verus loan amounts.

[midnight armadillo]

2. the credit crunch caused the Great Depression

according to economic theory. Stricter is good, too-strict could take down the economy.

[katty]

3. yeah! what a concept, huh?!!!

[ursi]

4. I like it ...they have f*cked things up enough, handing money out like no tomorrow

[flamin lib]

5. It's all about being careful what you wish for. The banking profession

bitched and moaned about over regulation for 20 years. In 1999 they got what they asked for, a lot of de-regulation and changing of the laws passed after the 1929 crash. They got to mix stocks and brokerages with lending institutions. They fucked up. Now we get to bail them out.

So much for financial Darwinism . . .

[katty]

6. the financial incest going on is so off the charts now, 'correction'

of this state of biz affairs will take more than this current schizophrenic 'plan'.