Credit ratings of leading banks due to large debt write-offs

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Reference no: EM131112259

The economy of country Rumblen was hit by a banking crisis which led to a recession. Jason Wallace, a real estate agent, says that the economy will recover soon because the government is taking various measures to counter the recession. According to him, the flow of credit will soon return to pre-crisis levels. His wife Anna Wallace disagrees with him. She says that the situation may not improve soon, given the substantial increase in unemployment.

Which of the following, if true, will weaken Jason's claim that the economy will recover soon?

A) Some banks in Rumblen reduced the overdraft fee on checking accounts to attract more customers. B) International agencies recently slashed the credit ratings of leading banks due to large debt write-offs. C) A large portion of the treasury securities issued by the government of Rumblen are held by its largest trading partner. D) The government of Rumblen recently bailed out two of the major banks in the country. E) Credit card debt in Rumblen had reached unsustainable levels prior to the crisis, prompting a series of defaults.

Reference no: EM131112259

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