The Credit Crunch Is Coming

The Credit Crunch Is Coming - at www.moneyweek.com - the best of the international financial media

We continue to monitor activity in the credit markets for signs of deterioration. The credit cycle has unquestionably changed credit, particularly unsecured credit, is progressively harder to secure, especially for those who desperately need it. We think that this is the single most important issue.

Barclaycard's Chief Executive, John Varley, recently reported that 50% of applications this year have been refused. However, in typical double-speak, he downplayed talk of a credit crunch saying: 'We are being selective about who we lend to. Unsecured loans are usually the first to go into arrears if people are finding it tough, because their first point of defence is their mortgage, but it is important to retain a sense of perspective. There is no crisis and we don't see any signs of significantly higher unemployment'.

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