I have read an article called "Stocks have shrugged off the banking turmoil. Haven’t they?" in The Economist newspaper, but I find it hard to understand the meaning of a sentence. The sentence is

A credit crunch will crimp economic growth and therefore profits.

Context of the sentence:

Bank failures are usually bad for business. A sickly banking system will lend less and at higher interest rates to companies in need of capital. A credit crunch will crimp economic growth and therefore profits. On occasion, a bad bank can blow up the financial system, causing a cascade of pain. Investors know this. They have dumped stocks when banks have failed before.

Which option below correctly represents the meaning of the aforementioned sentence?

  1. The credit crunch will crimp economic growth, as a result, the credit crunch will crimp profits.
  2. The credit crunch will crimp economic growth, for that reason, the credit crunch will bring profits.
  • A credit crunch will crimp economic growth, and therefore (it will crimp) profits. You could google ellipsis to read more about such constructions.
    – user405662
    Apr 26 at 9:29
  • 1
    Aren't "economic growth" and "profits" just both objects of "crimp"? Why does it need a more complex explanation?
    – Stuart F
    Apr 26 at 10:17
  • @StuartF I think you're right there.
    – user405662
    Apr 26 at 10:44
  • To answer the question, and therefore profits is a conjoined clause that's been reduced to just a noun phrase and a couple conjunctions by the rule of Conjunction Reduction. What it's reduced from is the clause and therefore a credit crunch will crimp profits, with all of the stuff repeated from the first clause deleted. Conjunction reduction applies to any conjoined constituent, from noun phrases to clauses. Apr 26 at 16:19

1 Answer 1


Profit is a noun. The context forces this.

If it were a verb, its subject would be "A credit crunch" and the sentence would be economic nonsense. Hence 2. is nonsense.

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