Thursday, 8 November 2007

UK 'Faces More Financial Shocks'

The governor of the Bank of England, Mervyn King, has warned that the US sub-prime mortgages crisis poses more risks for the UK's financial system.

Those Big financial institutions in England and the US are being saved by the central Banks. Without the multi-billion dollar bailouts we would see a whole lot of them go out of business. Pretty scary stuff.

And it seems these institutions keep requiring more money to just stay afloat. World financial markets are disastrous. The big instituions have simply taken on too much bad debt. With the situation in the US subprime market set to worsen in the coming months, with 1 in 196 US houses already in some form of foreclosure, we will see a continued slow down as US (and UK) lenders take on huge losses.

Of course the US authorities have been trying hide the poor state of their economy for some time with phoney unemployment and inflation figures.

In the ead reality has a nasty way of rearing its ugly head.
Bad times ahead.

No comments: