Monday, November 05, 2007

The Federal Reserve loan officers’ survey

The impotent Fed........ Taken from Pimco´s U.S. Credit Perspectives. More on this topic from Calculated Risk , Mike Larson & Michael Panzner / Financial Armageddon

Die machtlose Fed..... Das ist ein Auszug aus dem aktuellen U.S. Credit Perspectives von Pimco. Mehr zu diesem Thema gibt es von Calculated Risk , Mike Larson & Michael Panzner / Financial Armageddon

Banks & Lenders: Rising Caution
The large debt overhang in recent years was sustainable so long as banks were willing to lend, structured credit markets provided liquidity and housing prices rose. Of course, those factors changed radically in August. While the Federal Reserve will likely lower the Fed Funds rate considerably in this environment, I don’t believe the risk appetite to extend credit to individuals and companies will resurface anytime soon amid falling home prices and slowing corporate profits. Financial sector write-downs will likely continue into next year given declining asset quality, and banks will likely be increasing loan loss provisions.
Not exactly the best environment for fostering lending and risk taking. The Federal Reserve loan officers’ survey confirms these trends
> With less and less appetite in the ABS market to unload the loans this should come as no surprise.
> Da den Investoren der Appetit auf die weitergereichten Kredite vergangen ist sollte dieser Trend keinen wirklich überraschen

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