The credit crunch 'is here to stay'

08/09/2008

Credit crunch conditions are likely to continue to be felt for years to come, it has been suggested.

New analysis from Citywire suggests that bankers and mortgage lenders are "privately begging" the government to extend its Special Liquidity Scheme past its current deadline of October 20th.

The scheme was set up to provide mortgage firms with a cheap source of funding - and the fact that these organisations want it to continue suggests that they see no end for credit crunch conditions over the months to come.

"It's becoming clearer by the day that we are now entering a whole new economic era, one in which there will be no cheap credit to prop up the economy, at least for the foreseeable future," the report adds.
Meanwhile, a new forecast from estate agents Savills suggests that the current housing downturn will continue until 2011.

According to the firm, there will be an overall drop of 25 percent in house prices from the market's peak last year, just before the beginning of the crunch.

The Organisation for Economic Cooperation and Development, a top think-tank, has also recently said that Britain will enter recession conditions - which economists say occur when the money made from goods and services shrinks for six months in a row - by the end of the year.

Tags; Current UK Economy, Retirement Money Problems, Credit Card Lifestyle, Recent Graduate Debt, Young Family Finances,

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