July 9, 2008

Banking crisis could show loses of £800 billion

At lot has been said about the credit crunch, but in reality this may be revised to a credit crisis! As warnings are coming out that banks worldwide are bracing themselves for a series of massive loses.

The problem is that some people would be inclined to say that it’s their own faults and get on with it, but this crisis could have far reaching consequences that could affect virtually everyone in the world.

Initially the International Monetary Fund had estimated the loses to be something in the region of £200 billion, which is bad enough. But revised figure from a US Hedge fund has said that the overall loses currently could be as bad as £800 billion.

This figure is just too huge to contemplate and it is difficult to imagine how some banks who have found themselves overstretched could actually survive.

Source [Telegraph]