Anyone Freaking Out About Credit Crunch

What's going on?

No sense freaking out - but it's a good idea to make plans for what happens if you can't get credit or if you lose your job.

The company I work part-time for stopped work on a building project in the tens of millions about 2 months ago - due to tight credit. The investors' credit lines are good - but the money isn't there.

Two weeks ago the company announced a major cutback of employees - the final tally isn't yet known but many long term full-time employees have been made part-time. This way, the company doesn't have to pay benefits such as health insurance. Some employees have been let go - many of them with as much as ten years of seniority.

This company is not the first taking such action this year - almost all of its competitors have already made major cutbacks. The companies themselves are reporting no loss in profit over prior years - but are cutting every corner to maintain and increase that profit.

For several months, credit card companies have been quietly raising interest rates - often without logical reason - and have also been lowering credit lines for many of their customers. This is a two edged sword for unsuspecting consumers - If you have a credit line of $10k on an account and owe $4k on that account (and pay on time), it's good for your credit rating. If your credit line is lowered to $5k, all of a sudden you appear to be near your credit limit - thus becoming a higher risk and often resulting in a lower credit score which makes it harder to qualify for more credit and may increase interest you pay on other accounts.

These changes have been happening without fanfare at least since the beginning of 2008 but because they happen to individuals and separate businesses, it hasn't been seen as the crisis it is. Only when it hit Wall St did it become "urgent".

kay

Sudan or Lithuania? First time I've ever seen those 2 countries put on a par with each other!

Tommy.

That's kick ass way of looking at it. I like your attitude. Might do some Americans some good to feel a little of that hardship many other countries feel on a daily basis.

???

Are you serious - that guys so crazy his brain produces its own medication.

;-)

The Bail out is FASCISM and ILLEGAL under the US Constitution. Not saying they can't do something -- but they should consider that if a new Gulag is ever formed for the Bush admin - anyone who voted to take our money for corporate investing will go down with the criminals in office with whom they are in compliance.

I'm curious as to his definition of baby boomer because according to some they are already starting to retire.

Yeah Tommy - - Ya just gotta know that things are completely FUBAR when people start wishing they were Irish!

Our whole city is on tenderhooks right now. Many people here have lost a lot of their savings through the purchase of Lehman bonds. There is a lot of anger around because they were told by their bank, usually HSBC that the bonds were totally safe.

There was a run on a bank last week that was started by a false malicious rumour. Sellers of luxuary properties have slashed their asking prices by up to 30%. In one case, a luxuary property that was listed for over $3M in June went for under $1.5M

The whole atmosphere is so fearful and posionous right now that we may expect further bank runs anytime. Our deposits here are only guaranted up just over $10000.

I just don't anybody in their right mind here is not freaked out about what may happen next. I honestly feel that they should be rescued Lehmans first but put the 700B rescue package back.

-Derek