The Central Bank prevent banks from lending money to everyone they want?
— All domestic and international swen telegram data experience shows that reasonable restrictions are absolutely necessary. It is clear that people and businesses often want to borrow more money at the moment, but the consequences can be very negative. This can be compar to healthy eating: it is pleasant to eat sweets, but if you abuse them, your health will be harmed, sometimes fatally. The same is true in the economy — a high level of debt load carries risks for financial stability, that is, for the normal operation of banks and financial markets.
The danger of risk accumulation
Often not obvious until the thunder strikes. For example, on the eve of the US mortgage crisis of 2007-2008, people did not sense the impending disaster. They happily bought houses on credit at very high prices. Banks lent money to everyone, even to people with large debts and bad credit histories, believing that real estate would continuously rise in price and everyone would make a good.
Turned out that people
could not pay their loans and banks began to take away mortgaged housing, prices quickly went down, and borrowers and banks lost huge amounts of money. Then the mortgage crisis spread to other explanation of complex concepts segments of the financial market and eventually turned into a large-scale global crisis. Oil prices fell 5 times, from $150 to $30 per barrel. Only a few experts alb directory foresaw the collapse and how painfully it would hit the financial sector and then the US and global economies. It became obvious that financial stability needed to be addressed systematically.
