Media hype would lead us to conclude that we have been in a credit 'crunch' for the past year; however the reality, shown by the numbers, is that the credit crunch is still to come. US household and corporate debt growth remained positive through June 2008 and I anticipate that both will turn negative over the near term as financial institutions continue to delever. So credit market stress is likely to move from the financial to the corporate sector over the next few months.
The financial system
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