U.S. could face $2 trillion lending shock: Goldman – U.S. mortgage market crisis
Posted on: November 17th, 2007
The macroeconomic consequences could be quite dramatic,” Hatzius said in the note to clients. “If leveraged investors see $200 billion of the $400 billion aggregate credit loss, they might need to scale back their lending by $2 trillion.”
“This is a large shock,” he said, adding the number equates to 7 percent of total debt owed by U.S. non-financial sectors.
Hatzius said such a shock could produce a “substantial recession” if it occurred over one year, or a long period of sluggish growth if it occurred over two-to-four years.”*
Curation from Tomás
Filed Under: 1. Hispanic News, OT (off-topic), Real Estate
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