Credit crunch

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Credit crunch
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• How has the financial crisis or credit crunch
  - affected you?
• Do you know anyone whose parent has lost their
  job?
• Is your family spending less?
• Are you worried about the future?

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For people in the UK, the last year has been very
difficult. Prices, especially food and fuel,
went up. Banks went out of business. Some people
lost their savings, and their homes. As people
spent less money, businesses closed and people
lost their jobs.
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We are feeling the effects of the credit crunch,
as food and petrol prices soar
as exchange rates fall as high inflation
damages local economies
but in developing countries members of our global
family are hit hard
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Now salaries are worth much less, while the cost
of living is much higher.
Some of the ways people have tried to cope

• selling what they own e.g. tools, animals etc
• children dropping out of school to work
• spending less on health care
• going into debt

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Due to the financial crisis, during 2009 55 -
90 million more people will be living on less
than 1.25 a day (Source World Bank estimate)
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1 buys
US Dollar ()
Euro ()
2.005
1.43
1.43
1.07
2007/8
2009
2007/8
2009
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CAFOD Grants
50,000 grant
not only are poor people seeing rising prices,
but the money that agencies like CAFOD have given
is now worth almost a third less
100,250
71,500
2008
2009
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There are a number of reasons for food price
rises in Kenya, including drought, and violence
after the last elections which destroyed crops
and delayed planting.
Those living in slums are more vulnerable,
because they cant grow their own food, and they
rely more on jobs for income.
The global financial crisis has made things even
worse.
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There is electricity, but no running water. They
share a sink and toilet with ten other families.
Margarets family of seven has an income of about
43 a month.
Margaret Mueni lives in Mathare slum. She lives
in one room with two of her own children and four
nephews and nieces.
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Things are getting harder everyday... it just
means I have to work harder, because I cant do
anything to stop the prices rising.
The maize flour is the worst. It was 50
shillings in 2007. Now its 95 shillings for a
2kg packet.
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Margarets daughter, Faith (15), says
Sometimes when I go to school they tell me to
go home because I dont have money for fees...
I dont think about leaving school to work
because if I am educated I can be a better person
in future.
I sometimes sleep without eating. But Im okay
at school, I can concentrate because when I reach
school I get some porridge.
Theres some things you dont share with your
friends, because I feel like crying and dont
want to cry in front of them.
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This crisis will happen again if we live beyond
our means, trying to have more, rather than to
be more.
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Exclusive concentration on having more means
being less... Love, friendship, prayer and
contemplation are necessary values. Without
such gifts people can make no proper progress
from what is less to what is more genuinely
human Pope Paul VI

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What would a more genuinely human world look
like?
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What is more human? The end of want everyone
having enough the end of social ills of every
kind more knowledge more culture respect for
the dignity of others the spirit of poverty (Mt
53) cooperation for the common good the will
for peace. Pope Paul VI On the Development of
Peoples, 1967 (abridged)

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So far CAFOD has been able to ensure that we can
still fund our partners next year. But...
We are less able to respond to our partners
needs for support in new areas If the crisis
continues, we may not be able to continue to
support all of our partners.
Your help could make all the difference!
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• You can make a difference by
• Telling others
• Saving money
• Raising money
• Praying
• Living simply

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We pray together Thank you for the many riches
you have given us homes and warmth food and
water security and freedom. We pray for those
who do not have these things, all those pushed
deeper into poverty by the credit crunch. Teach
us to be generous with our riches and to
remember that they do not belong to us, they
were given for everyone to share. We make this
prayer through Christ our Lord. Amen.
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Credit crunch
Picture credits Frederic Coubert, Datinyone,
Observer Standard, Pascale Palmer, Claire
Goudsmit, Annie Bungeroth
Summer 2009