Quote:
Originally posted by widgeon13
Chicken Little..... the sky is falling.....
Why did this not happen following 9/11?
|
The Overnight Lending Rate was LOWERD to 1%, GM went to 0% Financing which one kept the cash flowing and the American people buying....there is nothing like greed to keep an American purchasing.
When the monthly cost of borrowing money decreased the price of the merchandise went up to recreate an equilbrium of cost to income. As prices rose to keep the wheels turning special financing schemes were put into place. Now to slow the increase in price of the merch the cost of borrowing money has increased. What then becomes at special risk is the special financing loans as they come due but that is another topic of discussion.