Rewriting the rule book

The dreaded phrase; the ‘credit crunch’ has infiltrated vernacular speak. For one who is charged with the (unenviable) remit of managing a rapidly contracting local economy in the North East of England, this only became apparent when a young relative of mine, not long out of nappies, told me that she was not allowed a new toy, and was thus saving her “pennies, because of the credit crunch”. The crunch has transformed into an economic recession that is real: affecting you, me and even my younger cousin Hannah. What began as a banking crisis during the summer of 2007 following the collapse of the US sub-prime mortgage market has subsequently led to an international tightening of fiscal transfers and a lack of confidence in global stock markets. In autumn 2008, the strength of the financial system was tested further with a severe collapse of confidence. Only massive liquidity support by central banks and rescue packages engaged by national and supranational governments have (so far) staved off a systemic financial meltdown. Consequently, what started as a crisis in the financial sector continues to affect the ‘real’ everyday economy. Initial projections that financial capitals, such as London, would feel the brunt and peripheral towns and cities, such as Durham, with less employees in the banking sector would be sheltered are now proving way off mark.