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Funny such an economic whizbang didn't foresee his own companies' bankruptcies.
The bankruptcies were strategic filings------much the same way Henery Ford and Paul Allen of Microsoft have used the system in the same strategic manner.
You may not agree with it and it may not be ethical in the minds of most, but it is what it is.
Before you ditch or change the bankruptcy laws, I'd abolish a protective vehicle like an LLC first.
And the auto industry, makers of what for most people are the second biggest investment they ever make next to their homes, posted record sales last year of 17,500,000 vehicles.
Record Auto sales is a huge fallacy. Wall Street has securitized auto lending and vastly reduced the lending standards much in the same way pre 2008 mortgage industry.
Many folks are paying 30 percent, with notes that are 8 to 10 years long. It's just a short matter of time before the automotive sales industry experiences a huge crash...
Record Auto sales is a huge fallacy. Wall Street has securitized auto lending and vastly reduced the lending standards much in the same way pre 2008 mortgage industry.
Many folks are paying 30 percent, with notes that are 8 to 10 years long. It's just a short matter of time before the automotive sales industry experiences a huge crash...
"...One of the more annoying and misguided claims making the rounds is that subprime auto loans are the new subprime mortgages.There are many reasons why this is wrong... In some states, it can take three years for a foreclosure to be completed. If you default on a car loan, the repo man and his tow truck might show up in three hours....With delinquent subprime auto-loans, the repossession process is so much faster it doesn't have the same drag on the local economy. The cars are too easy to find, repossess and resell, mitigating the losses on loans gone bad. A surge in repossessed cars may end up increasing the number of used cars for sale, but other than that, don't expect to see the huge write-offs by mortgage lenders that caused so much harm to the financial system and broader economy..."
"However, with a few notable exceptions, Morgan Stanley sees little chance of subprime auto asset-backed securities (ABS) becoming the new subprime mortgage bonds per se. Investors have been well compensated for buying such deals in terms of the extra cushion of protection embedded in such securitizations..."
"...One of the more annoying and misguided claims making the rounds is that subprime auto loans are the new subprime mortgages.There are many reasons why this is wrong... In some states, it can take three years for a foreclosure to be completed. If you default on a car loan, the repo man and his tow truck might show up in three hours....With delinquent subprime auto-loans, the repossession process is so much faster it doesn't have the same drag on the local economy. The cars are too easy to find, repossess and resell, mitigating the losses on loans gone bad. A surge in repossessed cars may end up increasing the number of used cars for sale, but other than that, don't expect to see the huge write-offs by mortgage lenders that caused so much harm to the financial system and broader economy..."
"However, with a few notable exceptions, Morgan Stanley sees little chance of subprime auto asset-backed securities (ABS) becoming the new subprime mortgage bonds per se. Investors have been well compensated for buying such deals in terms of the extra cushion of protection embedded in such securitizations..."
This isn't taking into account the longer terms today on auto loans. If someone takes out a 72 or 84 month loan and it gets repossessed at 30 months it's worth nowhere near the amount still due.
Of course you aren't going to have as large of write offs that you would have on a house but stupid is as stupid did.
"...One of the more annoying and misguided claims making the rounds is that subprime auto loans are the new subprime mortgages.There are many reasons why this is wrong... In some states, it can take three years for a foreclosure to be completed. If you default on a car loan, the repo man and his tow truck might show up in three hours....With delinquent subprime auto-loans, the repossession process is so much faster it doesn't have the same drag on the local economy. The cars are too easy to find, repossess and resell, mitigating the losses on loans gone bad. A surge in repossessed cars may end up increasing the number of used cars for sale, but other than that, don't expect to see the huge write-offs by mortgage lenders that caused so much harm to the financial system and broader economy..."
"However, with a few notable exceptions, Morgan Stanley sees little chance of subprime auto asset-backed securities (ABS) becoming the new subprime mortgage bonds per se. Investors have been well compensated for buying such deals in terms of the extra cushion of protection embedded in such securitizations..."
If you read the article I posted, notice it specifically mentioned that the sub-prime auto lending bubble would not destroy the mega banks but instead the specialized auto lenders - big difference.
But the key emphasis is that the growth in auto sales is fraudulent because it's based on the same fallacy in lending practices/standards that delivered us the mortgage debacle.
Remember in a very short sphere of time the country went from what Bush called the greatest /highest period of home ownership ship to the lowest period of home ownership.
It's highly likely the same thing may happen with regard to the purchase of new automobiles. They're being purchased through a form wizardry.....
Record Auto sales is a huge fallacy. Wall Street has securitized auto lending and vastly reduced the lending standards much in the same way pre 2008 mortgage industry.
Many folks are paying 30 percent, with notes that are 8 to 10 years long. It's just a short matter of time before the automotive sales industry experiences a huge crash...
And for the individual citing Goldman Sachs... If you believe or trust their analysts in lending, you do realize they are buying subprime housing again?
Besides, in autos, well people can walk, or drive, from a repo'd house. They literally have to walk from their car repo'd
I'd post links but many are too slanted, even in the title, for me to use without starting a semantic debate.
Caveat emptor... Or in Americans case ... Locationis emptor
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