DEFINITION of 'Consumer And Business Lending Initiative'

A plan initiated to aid in the government's goal of correcting the credit crisis by working on the secondary lending markets. Execution of the plan means extensive lending and reorganization of TALF.

BREAKING DOWN 'Consumer And Business Lending Initiative'

Without an effective secondary lending market, a large strain is placed on the major commercial banks, as the two lending mediums work hand in hand. Banks often combine their loans and sell them to the secondary markets, which keeps money flowing freely in the banks allowing them to continue to distribute both personal and business loans. Therefore, without the secondary markets, the lending from commercial banks dries up.

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RELATED FAQS
  1. What constitutes a secondary market?

    Find out what constitutes a secondary market, and learn why that term can be applied far more broadly than you might initially ... Read Answer >>
  2. Who do hedge funds lend money to?

    Discover the various entities that hedge funds are lending to, and the reasons why these hedge funds have been providing ... Read Answer >>
  3. Why do we need a secondary market?

    Find out why secondary markets play a crucial role in economic activity by promoting efficiency, safety, information and ... Read Answer >>
  4. How does a credit crunch occur?

    A credit crunch occurs when there is a lack of funds available in the credit market, making it difficult for borrowers to ... Read Answer >>
  5. What kind of assets can be traded on a secondary market?

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