Sub-prime mortgage crisis has struck the country hard. It has brought us on the threshold of recession. Now, what have the banks done to counter the problem? Obviously it has squeezed the liquidity taps. Getting a credit card is not all that easy in the post-slowdown world.

Credit rating agencies are working hard and unlike past when any one got a card, today they are more likely to sift chaff from grain. Credit reports have become more stringent and banks are not allowing cheap credit-rebuilding measures. One thing which might be heartening for the citizens is the proposed modification of the Bankruptcy law. Perhaps it is too early to comment on it now.

The structured credit market was always vulnerable and now it has finally come down. Investors and taxpayers are finding it hard to digest it but we always knew one day the incentive structure would have given away causing great market instability.