Riding out the storm

These past few months we’ve seen institutions racking up huge losses and high profile resignations, while bosses have been left scratching their heads as to how they could have exposed their firms to so much risk. One thing is for sure, however, the lending market will be a lot stricter in the future. According to recent survey by the Federal Reserve 55 percent of banks indicated that they had tightened their lending standards on prime mortgages. So risk exposure will come under greater scrutiny like never before – and not just in the mortgage market. Lenders have begun raising rates and slashing limits on credit cards as the days of easy and cheap credit come to an end. It all contributes to uncertainty and trepidation in the economy at the moment, while conflicting opinions circulate as to whether a recession is on the cards – or even with us right now. Time to strap yourself in; 2008 looks like it could be a bumpy ride.