Tight Money

AAA

DEFINITION of 'Tight Money'

A situation in which money or loans are very difficult to obtain in a given country. If you do have the opportunity to secure a loan, then interest rates are usually extremely high. Also known as "dear money".

INVESTOPEDIA EXPLAINS 'Tight Money'

When there are tight money conditions in the business world, capital is scarcer than usual and therefore commands a higher price. Firms tend to have a harder time obtaining loans and financing expansions in tight money conditions and tend to pay higher than normal interest rates if they are successful in obtaining funds.

RELATED TERMS
  1. Cheap Money

    A loan or credit with a low interest rate, or the setting of ...
  2. Dear Money

    A situation in which money or loans are very difficult to obtain ...
  3. Interest Rate

    The amount charged, expressed as a percentage of principal, by ...
  4. Loan

    The act of giving money, property or other material goods to ...
  5. Monetary Policy

    The actions of a central bank, currency board or other regulatory ...
  6. Money Supply

    The entire stock of currency and other liquid instruments in ...
Related Articles
  1. The Federal Reserve
    Economics

    The Federal Reserve

  2. What Is Money?
    Economics

    What Is Money?

  3. Short Sale Strategies For Buyers And ...
    Investing

    Short Sale Strategies For Buyers And ...

  4. Capital Structure
    Investing

    Capital Structure

Hot Definitions
  1. Halloween Strategy

    An investment technique in which an investor sells stocks before May 1 and refrains from reinvesting in the stock market ...
  2. Halloween Massacre

    Canada's decision to tax all income trusts domiciled in Canada. In October 2006, Canada's minister of finance, Jim Flaherty, ...
  3. Zombies

    Companies that continue to operate even though they are insolvent or near bankruptcy. Zombies often become casualties to ...
  4. Witching Hour

    The last hour of stock trading between 3pm (when the bond market closes) and 4pm EST. Witching hour is typically controlled ...
  5. October Effect

    The theory that stocks tend to decline during the month of October. The October effect is considered mainly to be a psychological ...
  6. Repurchase Agreement - Repo

    A form of short-term borrowing for dealers in government securities.
Trading Center