Why Can't We Have More Credit?

Big Nasty

Back in the last decade banks were giving out money like confetti, most had enough money to buy houses, cars, go on holidays, etc. We regularly got letters in the door pre-approving us for €5k credit cards and car loans. If you went for a €400k mortgage for a 2 bed apartment you would walk out with €500k so you would have enough to furnish the house, buy a new car and go on holiday. Of course too much money was being given out, everything got over-inflated and eventually the bubble burst and now there's no money left.

However if there was more credit available than there is currently, not mad money like before but a reasonable amount, people would have more money to spend, companies would stay open, people would be kept in jobs and the economy would begin to recover.

Is this not what the bank bailouts were for? Why hasn't the credit situation improved?

ronan45

Becauze they know that we know that we know that they know we wont pay them backz!

Latchy

Paying off the interest first on the actual loans might have something to do with it .Would you really want to borrow 100 euro at 85 % interest ? ( or something like that )

Kevin Duffy

Some bold men lided to the guvernment and us all and they gived us moneys they didnt hav and now we are being all stoopid and not making the peepl wot did it pay and we hav no more moneys to preetend to gives each other.

Kojak

MCMLXXV wrote: »

Back in the last decade banks were giving out money like confetti, most had enough money to buy houses, cars, go on holidays, etc. We regularly got letters in the door pre-approving us for €5k credit cards and car loans. If you went for a €400k mortgage for a 2 bed apartment you would walk out with €500k so you would have enough to furnish the house, buy a new car and go on holiday. Of course too much money was being given out, everything got over-inflated and eventually the bubble burst and now there's no money left.

However if there was more credit available than there is currently, not mad money like before but a reasonable amount, people would have more money to spend, companies would stay open, people would be kept in jobs and the economy would begin to recover.

Is this not what the bank bailouts were for? Why hasn't the credit situation improved?

The banks were bailed out due to vested interests on the goverments behalf. They ahd lobbyists/economists shouting in their ears saying they had to bail them out. It had nothing to do with gaining access to credit for the general population.

They should have been let go to the wall. In any other form of business, they would have gone bust a long time ago.

magicianz

They are very afraid of even more bad debts, more people are keeping money out of banks as they aren't trustworthy and this means banks can't create credit, much higher cash ratio needed now than in old days.

Just a few reasons :P

RichieC

It's all a big scam.

Big Nasty

With all the above taken on board I still don't see any reason why credit laws, or whatever can't be relaxed a little. It's not that banks have NO money to give out it's more that they have gone from throwing it at us to only lending to blue chip clients.

Viable business' are closing down as their overdrafts are taken away, potential set ups aren't happening as they can't borrow for working capital, less people are working, more draw the dole, etc.

A little more credit will mean less business going under, more jobs being created, more being spent by consumers, less on the dole, govt earning more in tax, etc. It's a win-win situation if they would allow a little more credit or am I missing something?

ejmaztec

Trust no-one with a pulse.:eek:

sock puppet

MCMLXXV wrote: »

With all the above taken on board I still don't see any reason why credit laws, or whatever can't be relaxed a little. It's not that banks have NO money to give out it's more that they have gone from throwing it at us to only lending to blue chip clients.

Viable business' are closing down as their overdrafts are taken away, potential set ups aren't happening as they can't borrow for working capital, less people are working, more draw the dole, etc.

A little more credit will mean less business going under, more jobs being created, more being spent by consumers, less on the dole, govt earning more in tax, etc. It's a win-win situation if they would allow a little more credit or am I missing something?

From what I understand banks deposits are so low that they have to shrink their balance sheets rather than lend out more money.

Princess Consuela Bananahammock

No money was handed out. loads were handed out. People just conveniently forgot that they'd have to actually pay this free money again and then found otu that they coundn't.

7sr2z3fely84g5

think it would be the "boom" all over again,those who authorised and took out loans are never realistically going to pay it back.