Credit Crunch
Every 3.69 minutes someone is going bankrupt (scary!)
According to Credit Action, the debtors’ charity, people go bankrupt at the rate of one every 3.69 minutes. A property is repossessed in the UK every 11.4 minutes. Spare a thought for the hard-worked staff of the Citizens Advice Bureau who handle an estimated 9.500 new debt problems every day. A staggering 16,348 individual bankruptcy petitions were made in the first three months of this year, along with 2,177 company winding-up petitions due to financial difficulty.
Source: The Independent
CMA could tell you who the next crunch victims are!
I came across an interesting firm recently – Credit Market Analysis, are part of the massive CME Group. These guys work in the exotic world of Credit Default Swaps (CDS) and provide information, in the form of default probabilities, that gives an indication of who might be the next victim of the crunch.
A default probability essentially gives you a percentage chance of a firm or a country going bust over 5 years. McDonald’s for example has only a 2.6% chance of default- so this looks like a safe bet compared to Clear Channel Communications which has a 79.5% chance of going bust sometime in the next 5 years
So if you are a private investor, or if as part of your business you extend significant credit lines to other firms then it may be worth talking to CMA to see if any of the assets in your portfolio look like they need their last rites read.
Check out their site for more free data www.cmavision.com/market-data.
Related links:
- Credit Flux – Clear Channel continues to rally ahead of improved results.
- The Klaus Kneale Pink-Slip List (P-SL) for January 2009.
- Clear Channel Communications Inc. lay off 1500 today.
- Bad news for at least 18 companies or 21000 jobs.
Google Definition: credit crunch.
Wow! we appear in another English Google Definition. This time if you type in: “define: credit crunch“.
Previously we had a definition for “GFC“. (Global Financial Crisis).
