Simple Way Crisis

Today who have not realized that there is crisis is that it is not of this world. The truth is that there is an abusive invasion of this word in all media and surely ye has beaten closely or to an acquaintance. But why is crisis there? We are tired of listening to theories and reasons for experts who only care that nobody understands them to show off their knowledge. To explain the current crisis in a simple and comprehensible way we have to focus on the overall balance of things. If you would like to know more then you should visit Glenn Dubin. In recent years and especially after the attacks of 11 S of the United States exploded a small stagnation in the economy produced by the fear and the risk of war. To avoid this stalemate and provide incentives for the purchase and consumption, world banks fell a lot interest rates, so ask for credits came cheap. Coupled with the price of housing was rising, it led to a fever for purchasing homes. The buyer considered that a House that bought then, tomorrow would be worth more; so this morning I’ll be richer than today.

What we call speculation. Until here everything correct, remain more or less in balance. The problem appears when banks, surely to earn more money, offer these loans without properly studying if long-term customer may pay the mortgage or the credit. I.e., a credit was given at a very low price to anyone. Years later to control inflation, banks Board interest rate, so the price of these credits and mortgages rises a lot. What happens now? Because many people, mostly of low income can not pay his mortgage with his salary. It paralyzes the economy in general. The price of housing has risen so much that nobody already buys, and begins to lower its price. Let us take an example: Juan buys a House by 50 million in 2004, this calls for a mortgage to the Bank at an interest rate of 1%.