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credit crunch

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Tags: economy

A credit crunch is an economic condition in which investment capital is difficult to obtain. Banks and investors become wary of lending funds to corporations, which drives up the price of debt products for borrowers. Often an extension of a recession, a credit crunch makes it nearly impossible for companies to borrow because lenders are scared of bankruptcies or defaults, resulting in higher rates.
(source: http://www.investopedia.com/terms/c/creditcrunch.asp#ixzz4O7KCnSBt)

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