Thursday, March 20, 2008
it's officially a recession
the analysis at fitch, via housing wire: the credit crunch is not only not over -- it's accelerating.
the immediate bout of illiquidity and panic may or may not be over, but the intermediate-term picture is actually getting bleaker by the moment.
prepare yourself. once bank failures start, the great unwind is likely to accelerate, opening the possibility of some truly ghastly consequences.
What commentators totally miss is how incredibly fragile consumption really is. With mortgage lenders going bust by the day and the household sector hit by a barrage of depressing headlines it is entirely possible that further retrenchment in the obscenely high borrowing requirement will yet generate a economic slump which no-one will predict… This is the big domino that is yet to fall.