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Date Published : Wednesday, September 24, 2008
As the credit crunch begins to bite in certain parts of the globe, many Australians might be wondering what it means for them.
On the whole, it is mainly investors and holders of superannuation funds that are feeling the pinch, but as a general rule, anything that affects financial markets is likely to have a knock-on effect on everyday matters.
For example, the Herald Sun highlights the examples of people needing a loan to buy a car or a mortgage to purchase a house. These borrowers could well find that the options available to them have been pared down, while interest rates offered on the loans are much higher than usual.
With spending down, retail and manufacturing are the next dominoes to fall. With businesses making less money, they can afford to employ fewer people - which leads to job cuts.
However, the problems witnessed in the US and UK markets might not spell doom and gloom for individual finances in Australia just yet, according to the newspaper.
While $5 trillion disappeared from world share markets last week, a two-day surge on Wall Street might have marked the beginnings of a return to normality. Additionally, the Australian economy depends more on events in China and the decisions of the Reserve Bank than it does on the US.
So the message is, while financial conditions could yet get tighter, there is no need for Australians - whether first-time buyers or experienced investors - to panic just yet.
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Australia's economy is in a healthy enough state to see it make it through the global downturn in one piece.
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As the global economy takes a battering, Australians could be forgiven for fearing the worst when it comes to their own nation's money matters.
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Many mortgage and loan customers might be paying attention next month to see what decision the Reserve Bank of Australia makes on the interest rate.
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There could be a greater level of investment in residential mortgages in Australia, if the federal treasurer gets his way.
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Despite confidence in the Australian banking system coming relatively unscathed through the global credit crunch, many institutions have become more cautious in their lending.
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- Australia to weather the storm, says IMF
Australia's economy is in a healthy enough state to see it make it through the global downturn in one piece.
- Australia to weather the storm, says IMF
Australia's economy is in a healthy enough state to see it make it through the global downturn in one piece.
- Public and government 'confident in face of global economic turmoil'
As the global economy takes a battering, Australians could be forgiven for fearing the worst when it comes to their own nation's money matters.
- Public and government 'confident in face of global economic turmoil'
As the global economy takes a battering, Australians could be forgiven for fearing the worst when it comes to their own nation's money matters.
- PM warns crisis is 'far from over'
Prime minister Kevin Rudd has warned the country that the global financial crisis still has a long way to go before it is over, it has emerged.
