credit crunch

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Credit crunch

A shortage of available credit for businesses and consumers. This situation could arise when lenders are reluctant to lend because of uncertainty of defaults or are willing to lend only at high interest rates thus making it difficult for businesses and consumers to secure credit. The term became popular the financial crisis that began in 2007 when a large number of homeowners either defaulted or were expected to default on mortgages, leading to great stress on the market in which these securitized loans were traded. The ensuing constriction in liquidity caused lenders to cut back on loans resulting in a credit crunch.
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credit crunch

A period during which borrowed funds are difficult to obtain and, even if funds can be found, interest rates are very high. Credit crunches were particularly severe before 1980 when the ceilings on interest rates that financial institutions could pay resulted in a drying up of deposits.
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References in periodicals archive ?
One particular difficulty with the debate over the credit crunch is that the term is used to describe a variety of credit conditions.
But even with the credit crunch, Britain had less unemployment than Margaret Thatcher created and she had no credit crunch to blame.
Mr McGuire said the housing market has returned to stability since the credit crunch,with the low in the market having been reached in 2008.
"We are seeing a lot more men and boys suffering with eating disorders and there has been a significant amount of adult men being referred since the credit crunch began," said Prof Lacey.
"That is more in my mind where things like the credit crunch impact on your thinking, impact on the psychology of spending and they should in my opinion." Lerner added: "Will pounds 50m be available again this summer?
Only one in 13 (or 8%) in Wales actively questions parents about the credit crunch, figures show.
"Eight Strategies for Surviving the Downturn" can be downloaded from the ICAEW website's dedicated credit crunch section - The Liverpool Society president Michael Cox said: "The vast majority of businesses should emerge from the downturn.
The annual top-10 ranking Ernst & Young's 2009 Global Business Risk Survey, published in conjunction with Oxford Analytica, reveals that the top strategic business risks facing companies globally during this year are credit crunch aftershocks, regulation and compliance and deepening recession.
THE "double whammy" of Christmas and the credit crunch will make this week one of the busiest ever for divorce lawyers, experts said today.
A BUSINESSMAN has defied the credit crunch and bought four fast fit centres.
pounds ONE in five people have changed their Christmas shopping habits to beat the credit crunch. A survey from Halifax found that more than a third of consumers started their Christmas shopping early this year, while one in five has saved earlier this year for Christmas.
Overheard in a City bar: "This credit crunch is worse than a divorce.

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