Europe will suffer from American CC

In the Old World are preparing for a wave of defaults

Europe is in anticipation of a wave of defaults on consumer credit-related financial losses the owners of credit cards in the United States, which American banks have suffered billions of dollars of losses. Experts do not exclude the pessimistic prediction that the loss of banks on credit cards in Europe will exceed an average of 7%.

The International Monetary Fund (IMF), approximately 14% of U.S. consumer debt, amounting to 1.914 trillion dollars, will not be returned. The IMF predicts that Europe will lose 7% of total consumer debt, amounting to $ 2.467 trillion, the most powerful blow would cause the UK, which is the largest in the country of borrowing on credit cards: There are indexes of credit cards rating agency Moody's indicates that the level of losses increased from 6.4% of loans in May 2008 to 9.37% in May 2009 on. A British hotline Debts National Debtline has reported that in May took 41 thousand calls from consumers concerned about their outstanding debt on loans, credit cards and mortgages, compared to 20 thousand calls in May 2008. And, judging by the statements of the service, yet are not even signs of reducing the number of downloads.

Experts note that the United Kingdom, and other major European economies (although to a lesser extent) are primarily due to American concerns. For example, in U.S. banks such as Citigroup, Bank of America, JP Morgan Chase and Wells Fargo, as well as issuers of credit cards such as American Express, have suffered losses in the billions of dollars on their credit card portfolios and warned that it expected the new losses. «The concerns and fears of Europeans is understandable and justified, - the expert believes the London School of Economics, Philip White. - «Bad» loans - a serious problem not only for the banks. For example, the mortgage problems have already forced the government to go on an unprecedented write-offs, which led to huge budget deficits. Hence, U.S. banks suffer wreck and pull for the entire rest of the world, and Europe is no exception ».

Now the unemployment rate in the United States is the highest since 1983, reaching 9.4%, and is projected to the American Banking Association, by the end of the year was 10%, and early next year pereshagnet this point. «The only measures that can somehow positively affect the current situation - is a simple action to protect the rights, because the problem of non-payment, first, that people are either left without work or a result of substantial reduction in wages - believed analyst Friedman Billings Ramsey Gary Townsend. - With regard to exactly what the UK has been the most affected country in Europe, the case here in the attachment of Economics United Kingdom to the United States. London depends on Washington's much more than Germany ».