Auto credit bubble?

[Deserted]

The following link shows another side to the credit bubble:

http://www.latimes.com/business/la-fi-autoloans30dec30,0,4315064.story?coll=la-home-center

According to the article about 30% of these auto loans are repackaged for “investment”. Sound familiar?

Borrowers owning more on an asset than the asset’s worth. Sound familiar?

I do love the comment by Mr. Taylor, from the National Automobile Dealers Association, saying that these wonderful loans allow people to buy luxury cars when they would otherwise only be eligible for a “more modestly priced vehicle.” Unbelievable — and also too familiar.

[Allan from Fallbrook]

contrarian: You can drive through neighborhoods in Temecula and Murrieta that are solidly middle class, and see Mercedes C and E class cars parked right alongside Yukon Denalis, Caddie Escalades and Hummer H2s. You’re talking about $100k plus worth of vehicles, and this doesn’t count the jet skis, boats, RVs, etc that these families “own”.

The more astute posters here have pointed out that this is not a housing bubble, so much as it is a credit bubble, and the LA Times article points that out. We are addicted to debt, whether it’s in the form of exotic mortgages, car loans, or commercial credit. We threw ourselves one hell of a party, and the bill is about to come due with a vengeance.

[Allan from Fallbrook]

contrarian: You can drive through neighborhoods in Temecula and Murrieta that are solidly middle class, and see Mercedes C and E class cars parked right alongside Yukon Denalis, Caddie Escalades and Hummer H2s. You’re talking about $100k plus worth of vehicles, and this doesn’t count the jet skis, boats, RVs, etc that these families “own”.

The more astute posters here have pointed out that this is not a housing bubble, so much as it is a credit bubble, and the LA Times article points that out. We are addicted to debt, whether it’s in the form of exotic mortgages, car loans, or commercial credit. We threw ourselves one hell of a party, and the bill is about to come due with a vengeance.

[Allan from Fallbrook]

contrarian: You can drive through neighborhoods in Temecula and Murrieta that are solidly middle class, and see Mercedes C and E class cars parked right alongside Yukon Denalis, Caddie Escalades and Hummer H2s. You’re talking about $100k plus worth of vehicles, and this doesn’t count the jet skis, boats, RVs, etc that these families “own”.

The more astute posters here have pointed out that this is not a housing bubble, so much as it is a credit bubble, and the LA Times article points that out. We are addicted to debt, whether it’s in the form of exotic mortgages, car loans, or commercial credit. We threw ourselves one hell of a party, and the bill is about to come due with a vengeance.

[Allan from Fallbrook]

contrarian: You can drive through neighborhoods in Temecula and Murrieta that are solidly middle class, and see Mercedes C and E class cars parked right alongside Yukon Denalis, Caddie Escalades and Hummer H2s. You’re talking about $100k plus worth of vehicles, and this doesn’t count the jet skis, boats, RVs, etc that these families “own”.

The more astute posters here have pointed out that this is not a housing bubble, so much as it is a credit bubble, and the LA Times article points that out. We are addicted to debt, whether it’s in the form of exotic mortgages, car loans, or commercial credit. We threw ourselves one hell of a party, and the bill is about to come due with a vengeance.

[Allan from Fallbrook]

contrarian: You can drive through neighborhoods in Temecula and Murrieta that are solidly middle class, and see Mercedes C and E class cars parked right alongside Yukon Denalis, Caddie Escalades and Hummer H2s. You’re talking about $100k plus worth of vehicles, and this doesn’t count the jet skis, boats, RVs, etc that these families “own”.

The more astute posters here have pointed out that this is not a housing bubble, so much as it is a credit bubble, and the LA Times article points that out. We are addicted to debt, whether it’s in the form of exotic mortgages, car loans, or commercial credit. We threw ourselves one hell of a party, and the bill is about to come due with a vengeance.

[I would rather be lucky then smart]

Who doesn’t know somebody that was never upside down in their car?

This has been going on forever and doesn’t matter whether the loan is for 12 months or 84 months.

The only way to avoid it is to pay cash, put a huge amount down or lease a car that you can walk away from at the end of the term-or-purchase one that goes up in value rather then down.

The last scenario is pretty improbable.

[I would rather be lucky then smart]

Who doesn’t know somebody that was never upside down in their car?

This has been going on forever and doesn’t matter whether the loan is for 12 months or 84 months.

The only way to avoid it is to pay cash, put a huge amount down or lease a car that you can walk away from at the end of the term-or-purchase one that goes up in value rather then down.

The last scenario is pretty improbable.

[I would rather be lucky then smart]

Who doesn’t know somebody that was never upside down in their car?

This has been going on forever and doesn’t matter whether the loan is for 12 months or 84 months.

The only way to avoid it is to pay cash, put a huge amount down or lease a car that you can walk away from at the end of the term-or-purchase one that goes up in value rather then down.

The last scenario is pretty improbable.

[I would rather be lucky then smart]

Who doesn’t know somebody that was never upside down in their car?

This has been going on forever and doesn’t matter whether the loan is for 12 months or 84 months.

The only way to avoid it is to pay cash, put a huge amount down or lease a car that you can walk away from at the end of the term-or-purchase one that goes up in value rather then down.

The last scenario is pretty improbable.

[I would rather be lucky then smart]

Who doesn’t know somebody that was never upside down in their car?

This has been going on forever and doesn’t matter whether the loan is for 12 months or 84 months.

The only way to avoid it is to pay cash, put a huge amount down or lease a car that you can walk away from at the end of the term-or-purchase one that goes up in value rather then down.

The last scenario is pretty improbable.

[Coronita]

There was an article awhile ago in the LA Times about people burning their cars because of the high cost of gas and being upside-down in their car payments. I'll try to dig it up. It has some pretty sobering stats.

 

[img_assist|nid=5962|title=selfportrait|desc=|link=node|align=left|width=100|height=80]

—– Sour grapes for everyone!

[Coronita]

There was an article awhile ago in the LA Times about people burning their cars because of the high cost of gas and being upside-down in their car payments. I'll try to dig it up. It has some pretty sobering stats.

 

[img_assist|nid=5962|title=selfportrait|desc=|link=node|align=left|width=100|height=80]

—– Sour grapes for everyone!

[Coronita]

There was an article awhile ago in the LA Times about people burning their cars because of the high cost of gas and being upside-down in their car payments. I'll try to dig it up. It has some pretty sobering stats.

 

[img_assist|nid=5962|title=selfportrait|desc=|link=node|align=left|width=100|height=80]

—– Sour grapes for everyone!

[Coronita]

There was an article awhile ago in the LA Times about people burning their cars because of the high cost of gas and being upside-down in their car payments. I'll try to dig it up. It has some pretty sobering stats.

 

[img_assist|nid=5962|title=selfportrait|desc=|link=node|align=left|width=100|height=80]

—– Sour grapes for everyone!

[Author]

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