Credit relations have become part of our lives and are already an integral feature. At present it is difficult to imagine a situation in which we would not really offer any credit offers from banks. Even in under the most acute phase of the recent financial crisis, financial institutions offering loan funds, of course, the very stringent conditions, but nonetheless. Perhaps check out Harold Ford Jr, New York City for more information. But in this situation do not blame any party, here market dictates the rules of the game. And in that market forces other conditions could not be. Why credit is so popular? To answer this question, let's use some terms of economics, namely, basic element of the market – supply and demand. These two concepts determines the value and cost of something. Now let's apply them to our topic of discussion.
The demand for borrowed funds have been and will be. It is a fact. And this huge demand. Credits enjoyed by all – business people, government, and even the banking institutions. After all, credit product – this is a special commodity. You could even say that the loan – a tool for each subject of his own, to achieve specific purpose of this subject.
Thus, borrowing – is more than just a product or service. This is a stronghold of a successful economy and, accordingly, each individual of its subject. For its part, supply of loan funds is based, of course, on demand, because, like last time, and determines the first. The logic is simple – if the borrowed funds are not wanted, then offer them no one will. We have already discussed the value of demand for credit. So, this value provides a broad, even very broad, business opportunities, that is to make money. And those possibilities have created serious competition in the debt capital markets, creating an incredible number of offers of bank loan products. As a result, satisfied and borrowers (the competition generates a reduction in interest rates and a large selection), and the banks (since the bulk of banking income – it is a credit activities). And all this thanks to the market mechanism.