I’m going to be focusing on credit this week. Later this week, I’ll be discussing micro-credit in developing countries, but I thought I would start with some interesting developments in the US credit market. Felix Salmon over at Market movers, says consumers may have finally reached too much debt:
“credit card companies were happy to lend, and consumers were happy to rack up credit card debt, because they both knew that if the credit-card balance got out of hand, it could always be paid off with home equity. Now those days are over, and we're entering a consumer-credit crunch.”
This quote is in response to a more detailed post on the credit crunch by Henry Blodgett
Consumers lost another option for borrowing at least for the time being. Prosper.com a peer-to-peer lending website, is entering a quiet period (i.e. no loans) while it tries to register with security authorities.
Tomorrow (or next post) I’ll discuss the pay day loan initiative in Ohio.