September 3rd, 2010 | 
Author: When American banks have made all their money and their clients need more money to continue doing business, decided to do two things: borrow at banks around the world or sell junk mortgages to the banks financing other companies or the world. That the bank will sell the mortgage to mortgage the other means that the obligation to spend money on a new bank and new bank assumes the default risk. Clearly, banks both units worldwide thugs and will not want to buy a product like this. Therefore, the U.S. bank launched a package of new discoveries made from mortgages that include low-risk mortgages (good) and subprime (bad), put their name that sounds good (as Mortgage Backed Securities, or MBS, which still sounds better) and focus on worldwide sales. To make matters worse, creating other products that sound too good, but ultimately do nothing but garbage mask “” they contain. It began to spread financial risks for the half of the world. Stocks Pedraforca King does not have a little idea that their investments in the U.S. prestigious full of “garbage”. The Bank has decided to purchase these products Pedraforca Bank Grand Canyon, for example, and not aware of the risk. In other words, when Mr Capdevila put your money in his bank office Pedraforca the money goes directly to the Bank of the Grand Canyon and are provided for those without a steady job, no income and no permanent nature. Consequences: money Mr. Capdevila started to run a substantial risk (of globalization long life). Of course, responsible for the investment bank and has an obligation to pay Mr Capdevila. But what happens if you lose your money? Here enter the measures taken by the government, which decided to use public funds to ensure banks have the money.
Suddenly, many cases are expected, but nobody wants to hear about: the U.S. housing market collapse, says the price of money and no longer as attractive to invest in property. Furthermore, how can it be otherwise, stop the subprime mortgage to pay because they can not cope. American banks (and the people who buy their mortgages) remain with their homes, but can not sell it. The money had been lost. This results in a state of growing mistrust between banks. No one will lend to anyone. Almost no money left each other, and if they apply a very high interest. As interest rates people pay their mortgages each month (as EURIBOR it) depends on the prevailing bank interest between them when they left the money, this spectacular ride. Result: everyone has a mortgage, the United States or Catalonia, which is the monthly return for the pay increase does not make sense.
Remarkable discovery of American banks causing mistrust of the World Bank. As a result, banks have no money. So stop giving loans or mortgages are given. Without mortgages, people can not buy their own home, so that the housing market collapsed around the world. People who already have mortgages, sound domestic economy committed to a monthly mortgage. As a result, adjusted his belt and stop eating so much. Because people stop eating so the company must get less benefits and cut costs, for example, an office worker. Clearly, these workers should be further customized with a belt, which did not help ease the crisis. One of the hardest hit areas is the automobile (also based on bank loans, because usually buy a car through a loan) and slowly, the crisis is reaching other sectors of consumption.
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Tags: American banks, banks financing, Business, Grand Canyon, invest in property, mortgage