Quote:
Originally Posted by TheMaster
which the US had up till now, problem is that much of that growth was financed on lending, while Europe saved, America spent and the payments on those loans are causing a lot of problems
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This sums up much of the problems right now. Unsustainable consumer spending, made possible by risky and speculative loans, had been boosting the US economy for quite some time, but it obviously couldn't continue forever.
I am convinced that over the next few years, many more bad loans will surface, and many more loans will go bad. This will have a large detrimental effect on the economy as a whole and financial institutions in particular, and is pretty likely to result in prolonged recession.