Alexis Glick (see previous post) of FOX Business interviews a few market players who discuss the issues surrounding the tightened environment of the day.
Banks horribly mismanaged their risks principally through the subprime lending mechanism. Now, while they repair their balance sheets, homeowners with credit previously extended to them are having these loans frozen or called.
In order for the economy to rebound, and don't think for one moment the residential real estate market is not principal in the recovery, the consumer will need bargaining power and lines of credit to work with. With the banks squeezing the consumers by raising credit card rates, freezing credit lines and tightening lending requirements, the consumer appears to be a deer in the headlights.
Banks mismanage risks and then pummel the consumer to help them heal. This extortionist tactic cannot be good news if you looking for a rebound in this consumer driven economy.
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