Economic outlook: a factor offering better clues
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kimmie123
Apprentice
Joined: 05 Jan 2010
Posts: 1
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 Posted: 01/05/10 - 05:24 Post subject: Economic outlook: a factor offering better clues |
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The following are the main highlights of the Economic Survey:
• The prolonged dry spell and the expensive drought conditions appears to have had a serious impact on the country’s economic prospects, with the government downgrading the GDP growth projection
• The significant decline in agricultural growth is mainly due to crop failure
• Improvement in industrial production is rather negligible
• The service sector is unlikely to grow at levels seen just a year ago
• The bank credit to the commercial sector has risen by 2 percent till during the current fiscal as compared to 11.0 percent in the corresponding previous year
In the context of the recent declaration by the national government regarding the status of the economy, the intermediation by the financing institutions assumes even greater relevance. Banks like LoanMax of rod aycox fame and other prominent financing institutions, should endeavor to play a “supply-lending” rather than a “demand following” role when initiating the upturn in the financial sector by energizing the financial intermediation process.
When considering a bird’s eye view of the economy, the superior credit measurement of the investment proposals and the efficiency of capital, banks should endeavor to economize on the ‘search’ costs. These costs must be minimized when identifying and nurturing the growth impulses in the commodity and service sectors of the economy.
Firms like LoanMax have earned a name for themselves by solving the financial needs of people with any background. When considering the present working capital of LoanMax, this firm will be able to affect a major change only if had significant deposits or reserve funds worth more than a billion dollars. Since the bail out package announced by the Obama administration is available only to those banking institutions that are facing the crisis, successful banks like LoanMax may not be able to get any support. |
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