Wealth-Coaching

In today’s stock market investing blog, I will discuss today’s plummet in the stock market. Thursday, Wall Street witnessed the second largest market plunge of the year as investors finally clued into the rising problem of sub prime lending. For the last few years, many investors have started to be concerned, and their were rumblings that the sub prime market could spill over to affect Wall Street. The problem is that sub prime lenders have faced record numbers of foreclosures, so there is less cash out there to lend. Because of this, banks are less willing to let go of their assets. In addition to this, banks are putting together packages that are far more restrictive and their offers are at higher interest rates.

This is not just having an effect on home buyers, but now on corporate borrowers. Corporate borrowers are now far more restricted than they have been in the past and are not as able to make the kind of deals that have kept the market relatively hot over the last couple of years. During that time, there was a host of takeovers and mergers that were financed by lenders who seemed more than willing to finance these transactions. For more information on stock market investing, check back at this blog.