Explaining a Recession Simply and Clearly
Like many of our readers and clients, I’m the type of person who tunes in regularly to radio chat shows, current affairs programs and newspaper reports on how the global turbulence is affecting our house prices, our labour markets, our stock markets and our changing consumption habits. There are lots of commentators out there who seem very qualified and sound like they know what they’re talking about when discussing concepts like recapitalisation, nationalisation, liquidity ratios, deflationary pressures, credit ratings etc. and yet, when I’ve finished listening to them, I’ve usually forgotten what the question they were supposed to be answering was. Sound familiar? With that in mind, and throwing caution to the wind, I’m going to pose a few questions I think a lot of people would like answered, and I’ll try and do fiat currency as quicklyand clearly as possible. Please bear in mind that all of these issues deserve much more comprehensive answers than the size of this newsletter or the limits of my ability permit. How did the subprime mortgage crisis in the USA affect property prices in Ireland & Britain? Why are large international banking stocks trading at 30-60c per share when they were ?20-?30 per share 18 months ago? Why have banks moved so rapidly from loose lending criteria to excessively strict lending criteria? Why is unemployment rising so quickly and why are our economies slowly so rapidly? How can a person safely invest in a property market without falling victim to another property crash in 2010 or 2011? How did the subprime mortgage crisis in the USA affect property prices in Ireland & Britain? The subprime market, i.e.
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