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The difference is that you gave your money to the banks and expected them to keep it safe. Instead, they took your deposit and lent it to underpaid Americans to
by abdulhaq 18y ago
The difference is that you gave your money to the banks and expected them to keep it safe. Instead, they took your deposit and lent it to underpaid Americans to buy overpriced houses, in the hope of making lots of money for themselves.
With Hawala, the money is quickly picked up at the other end and not lent out to whoever promises to pay the highest interest rate.
- DavidSJ 18y agoMany banks did not engage in the foolish investment practices we've been hearing about, and yet their lending rates were substantially affected by the credit crisis due to the ensuing market conditions: higher costs of borrowing, higher perceived risks, less overall liquidity, lower trust in other parties, etc. No one is completely isolated from the effects of a credit crisis.