By Nick Beams | WSWS
While stock markets have stabilised—at least for the time being—the effects of the credit crunch sparked by the crisis in the US subprime mortgage market are now working their way through the banks and financial institutions and the economy as a whole.
This week, the financial fallout spread to Britain where HBOS, the owner of Halifax and Bank of Scotland, announced that it would extend credit to Grampian, a $37 billion debt-financed fund, or conduit, which deals in repackaged loans, including mortgages, credit cards, and motor loans. The bank said the funding would continue until market finance improved to an acceptable level.
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