Tuesday 29 March 2011

Bad credit crunch of US in 2009

Fiscal deficit of the U.S at a record 482 billion dollars in 2009, the objective of the U.S. government monetary fund is using reserves to impacts into market, in order to save the economy is in recession (BBC). This problem occurred mainly caused by the economic crisis, it has made most banks and large companies to bankruptcy this leads to the budget reserves of US have to focus on help these large companies to stabilize economies. Besides, this also leads to increase of unemployment. So many companies and people affected by this credit crunch therefore tariff reduced that further made fiscal deficits of the United States.

In the U.S., the establishment of private credit loans has dropped to lowest level, lower than the 2001 economic recession. In addition, because the risk that inflation brings, the U.S. central bank cannot reduce profits even further. Follow warn of IMF about risk of U.S. credit is pulled by loans of other sectors including cars industries.

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