I suspect MEW is the source of funds for many people. This Marketwatch story explains people tap equity, then credit cards, then their 401(k)s. Maybe that’s why the prime borrowers are not yet defaulting, as they have access to more credit and that retirement savings. Soon, that will be used up too.
As Warren Buffett said, you don’t know who’s swimming naked until the tide goes out.
Just wait a couple years, and then we will know the true financial condition of the people around us. Then we will know who truly could afford their lifestyle vs. who was living on credit.
