大象传媒

Is the worst of it all over? Are we talking ourselves into a recession? Let's get our terminology straight first.

We've had months of the credit crunch - so we've probably forgotten what it is!

Credit crunch simply means that you can't get credit quite as easily.

Basically - the banks lend听 to each other and that lending ability relies on confidence. But confidence in the banks knowing about the risks associated with their lending was lost. So what they stopped doing was lending to each other - and that meant that we couldn't get access to credit we needed as a business or individual.

Recession is different. It's measured in quarters and it is when we have a continual decrease in the output of this country - the Gross Domestic Product. So if we've had two consecutive quarters of that happening then that's officially a recession.

Officially, we're not yet in a recession.

The crunch makes these harder to get hold of

We still DO have a credit crunch, though. One of the problems is that we've all become used to 'easy credit'. There's been an over-reaction to that and it's changing.

People used to be able to go and buy a house with no capital at all and get a 125% mortgage and many were suggesting that to be able to do that was madness - that people were being encouraged to buy properties they couldn't really afford.

Now, the determination to do something about it, and correct it, is there.

So the impact is filtering though. With problems among the American financial services providers and less credit being available, we've already started to see a huge number of jobs being lost in the financial services industry here. That affects confidence.

We're losing easy credit. You can no longer get the 125% mortgages - and if you have have a less than perfect credit history the lenders are being more cautious about lending money to you again.

Wanting a credit card? Well, we all know that's been hard.

And lenders now want a lot more proof. The average Mr and Mrs haven't really been bothering about that but a lot of people have been applying for loans and just saying "Yes, I can afford it." There are a lot more checks in place again now.