http://www.cheaploans.co.uk/forum/ The CheapLoans.co.uk Community Forum Tag: what is the credit crunch en Wed, 08 Sep 2010 10:26:51 +0000 http://www.cheaploans.co.uk/forum/topic/what-is-the-credit-crunch#post-68 Thu, 10 Jul 2008 21:44:55 +0000 tribble 68@http://www.cheaploans.co.uk/forum/ <p>there are several possible reasons for food prices increasing:</p> <p>1. In the past when we were as a country producing too much farmers were encouraged to diversify into biofuels, returning farmland to woodland, hedgerows etc, and many also went out of business.</p> <p>2. Many poorer countries are enjoying rapid growth so food which was previously exported is now needed for their own population.</p> <p>3. Poor weather globally has effected crop production.</p> <p>4. Dealers are buying into commodities pushing up prices.</p> <p>We can only hope things balance out over time as in the past. </p> http://www.cheaploans.co.uk/forum/topic/what-is-the-credit-crunch#post-57 Thu, 03 Jul 2008 10:09:14 +0000 quincy 57@http://www.cheaploans.co.uk/forum/ <p>thanks zaphat, very insiteful! i dont understand this stuff very well at all. Why are food prices rising then? </p> http://www.cheaploans.co.uk/forum/topic/what-is-the-credit-crunch#post-52 Tue, 01 Jul 2008 15:56:14 +0000 zaphat 52@http://www.cheaploans.co.uk/forum/ <p>the credit crunch is very complicated, but in simple terms, lenders have been hit by a large number of defaults on loans they have underwritten (EG US sub prime)and this has eaten into their liquidity reserves i.e cash reserves which they need to hold to stay in business. banks lend to each other on the wholesale money markets, and the rate for this(LIBOR) has increased due to the increased risk and therefore banks are unable to borrow money themselves in order to lend to customers at a cheaper rate. there's a lot more to it than that, but that is the basis of the credit crunch. oil and food prices are a seperate issue. </p> http://www.cheaploans.co.uk/forum/topic/what-is-the-credit-crunch#post-50 Tue, 01 Jul 2008 14:27:15 +0000 quincy 50@http://www.cheaploans.co.uk/forum/ <p>In lamens terms can someone please explain what the credit crunch is and does it have anything to do with our increasing fuel and food costs? or is that something different? </p>