Reason #5: The credit crunch will continue

Filed under: Recession

By year-end 2009, we will see a more than $4 trillion pullback in credit lines. And we are a country that runs on credit. In fact, the entire growth in consumer spending from 1997 to 2008 was paid for with home equity lines and credit cards.

Credit standards are already impossibly high. My credit lines literally shrink every month because I do not use them. But what if I needed them? And I almost couldn't get a lease for a new car even though I have never missed a bill payment. The majority of people cannot borrow money and, therefore, cannot spend. This will not change in 2010.

Next: Reason #6: Excess capacity

Reason #5: The credit crunch will continue originally appeared on BloggingStocks on Sat, 24 Oct 2009 14:00:00 EST. Please see our terms for use of feeds.

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