What is Global Credit Crisis?. What's this thing thats so much in news these days? Big companies are melting down, people losing jobs and everyone sounds tensed.
People are unable to pay their debts, so they default, so then the banks raise interest rates to make more money to cover bad debts, and more people can't afford repayments and it goes on. I'm probably going to lose my house because the bank is going to raise rates to cover what it has lost in the US, and I lost my job because customers weren't paying their accounts, and my boss is struggling to keep his doors open because he will lose his house if his business goes bust
In this video interview, newly appointed Global Banking & Capital Markets Leader Bill Schlich offers his perspective about the importance of continued investment in risk management
Ernst & Young's Bill Schlich on the Global Credit Crisis
ABC AUSTRALIA INTERVIEW
Stock markets around the globe plunged early this week as Wall Street institutions such as Merril Lynch and Lehman Brothers went into serious financial difficulties owing to the worsening housing credit crisis.
Markets fell further after the US government's US$85 billion (US$1=RM3.45) bailout of insurer American International Group failed to calm investors.
Before that, markets were already battered by news of investment bank, Lehman Brothers, filing for bankruptcy, the largest in US corporate history and Bank of America's US$50 billion takeover of rival Merrill Lynch & Co.
What is happening is similar to the 1998 (Asian) financial crisis, but on a global scale, he said. "The outcome of the crisis… the rules of the game are going to be repeated."
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