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The One Trillion Dollar Consumer Auto Loan Bubble Is Beginning To Burst

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Soap Bubble - Public DomainDo you remember the subprime mortgage meltdown from the last financial crisis?  Well, this time around we are facing a subprime auto loan meltdown.  In recent years, auto lenders have become more and more aggressive, and they have been increasingly willing to lend money to people that should not be borrowing money to buy a new vehicle under any circumstances.  Just like with subprime mortgages, this strategy seemed to pay off at first, but now economic reality is beginning to be felt in a major way.  Delinquency rates are up by double digit percentages, and major auto lenders are bracing for hundreds of millions of dollars of losses.  We are a nation that is absolutely drowning in debt, and we are most definitely going to reap what we have sown.

The size of this market is larger than you may imagine.  Earlier this year, the auto loan bubble surpassed the one trillion dollar mark for the first time ever

Americans are borrowing more than ever for new and used vehicles, and 30- and 60-day delinquency rates rose in the second quarter, according to the automotive arm of one of the nation’s largest credit bureaus.

The total balance of all outstanding auto loans reached $1.027 trillion between April 1 and June 30, the second consecutive quarter that it surpassed the $1-trillion mark, reports Experian Automotive.

The average size of an auto loan is also at a record high.  At $29,880, it is now just a shade under $30,000.

In order to try to help people afford the payments, auto lenders are now stretching loans out for six or even seven years.  At this point it is almost like getting a mortgage.

But even with those stretched out loans, the average monthly auto loan payment is now up to a record 499 dollars.

That is the average loan size.  To me, this is absolutely infuriating, because only a very small percentage of wealthy Americans are able to afford a $499 monthly payment on a single vehicle.

Many middle class American families are only bringing in three or four thousand dollars a month (before taxes).  How in the world do they think that they can afford a five hundred dollar monthly auto loan payment on just one vehicle?

Just like with subprime mortgages, people are being taken advantage of severely, and the end result is going to be catastrophic for the U.S. financial system.

Already, auto loan delinquencies are rising to very frightening levels.  In July, 60 day subprime loan delinquencies were up 13 percent on a month-over-month basis and were up 17 percent compared to the same month last year.

Prime delinquencies were up 12 percent on a month-over-month basis and were up 21 percent compared to the same month last year.

We have a huge crisis on our hands, and major auto lenders are setting aside massive amounts of cash in order to try to cover these losses.  The following comes from USA Today

In a quarterly filing with the Securities and Exchange Commission, Ford reported in the first half of this year it allowed $449 million for credit losses, a 34% increase from the first half of 2015.

General Motors reported in a similar filing that it set aside $864 million for credit losses in that same period of 2016, up 14% from a year earlier.

Meanwhile, other big corporations are also alarmed about the economic health of average U.S. consumers.  Just check out what Dollar General CEO Todd Vasos had to say about this just the other day

I know that when we look at globally the overall U.S. population, it seems like things are getting better. But when you really start breaking it down and you look at that core consumer that we serve on the lower economic scale that’s out there, that demographic, things have not gotten any better for her, and arguably, they’re worse. And they’re worse, because rents are accelerating, healthcare is accelerating on her at a very, very rapid clip.

The stock market may seem to be saying that everything is fine (for the moment), but the hard economic numbers are telling a completely different story.  What we are experiencing right now looks so similar to 2008, and this includes big institutions just dropping dead seemingly out of the blue.  On Tuesday, we learned that ITT Technical Institute is immediately shutting down and permanently closing all locations.  This is from a Los Angeles Times report

The company that operates the for-profit chain, one of the country’s largest, announced that it was permanently closing all its campuses nationwide. It blamed the shutdown on the recent move by the U.S. Education Department to ban ITT from enrolling new students who use federal financial aid.

“Two quarters ago there were rumors about the school having problems, but they told us that anyone who was already a student would be allowed to finish,” said Wiggins, who works as the assistant manager for a family-run auto parts business and went to ITT to open new opportunities.

“Am I angry?” he said. “I’m like angry times 10 million.”

As a result of this shutdown, 35,000 students are suddenly left out in the cold and approximately 8,000 employees have lost their jobs.

This is what happens during a major economic downturn.  Large institutions that may have been struggling under the surface for quite a while suddenly give up and drop a bomb on those that were depending on them.  In the months ahead, there will be a lot more examples of this.

Already, some of the biggest corporate names in America have been laying off thousands of workers in 2016.  Mass layoffs are usually an early warning sign that big trouble is ahead, so keep a close eye on those companies.

The pace of the economic decline has been a bit slower than many (including myself) originally anticipated, but without a doubt it has continued.

And it is undeniable that the stage is set for a crisis that will absolutely dwarf 2008.  Our national debt has nearly doubled since the beginning of the last crisis, corporate debt has doubled, student loan debt has crossed the trillion dollar mark, auto loan debt has crossed the trillion dollar mark, and total household debt has crossed the 12 trillion dollar mark.

We are living in the greatest debt bubble in world history, and there are signs that this giant bubble is now starting to burst.  And when it does, the pain is going to be greater than most people would dare to imagine.

 
  • richjerk1929

    But when?

    • Chief ALWA. TOMO.

      richjerk 1929, in my opinion I don’t think you will get an answer that will prove to be accurate here. Last I remenber it was supposed to be during the last six months of 2015.

      • Disingenuous Indigenous

        I remember meeting you at Res 2016, you are Chief ALWA. TOMO.of the squat2pee tribe.

        • JC Teecher

          I thought he was Chief Buffalo Brief, of the Slappaho tribe.

          • LIZ THE SHIZ

            no he said where the FUGRRWE tribe and we a descended from the SCHMOHAWKS

      • Jerry C

        September/October 2014-2015 was the last of the tetrad of blood moons which ended the Shimtah, based upon Jewish reckoning. If memory serves me correct, the Shemitah is the every 7 years & the 7×7 Shemitah becomes a Jubilee year the following (50th). Assuming June 6, 1967 is an actual Jubilee year (miracle by God), then 2016 would be the 49th and 2017 would be the Jubilee year. I’d wager God is right; man, not so much.

        • LIZ THE SHIZ

          we are all full of Shemitah

    • Mike Smithy

      When Trump wins the election on 11-8-16, look for the banksters to pull the plug on the ponzi scheme.

      • Bill G Wilminton NC

        YUP……

        • Mike Smithy

          Welcome back Bill.

          • SnodtBlossom

            11 “After the Lord brings you into the land of the Canaanites and gives it to you, as he promised on oath to you and your ancestors, 12 you are to give over to the Lord the first offspring of every womb. All the firstborn males of your livestock belong to the Lord. 13 Redeem with a lamb every firstborn donkey, but if you do not redeem it, break its neck. Redeem every firstborn among your sons.

          • aldownunder

            BORING…..

          • SnodtBlossom

            29 Bear in mind that the Lord has given you the Sabbath; that is why on the sixth day he gives you bread for two days. Everyone is to stay where they are on the seventh day; no one is to go out.” 30 So the people rested on the seventh day.

      • alan

        They may pull it early and some how blame him hoping to swing the election to crooked Hillary. If that don’t work hack the machines and blame it on Putin.
        Then postpone the election for 6 months while new secure machines are built and rolled out.

        • SnodtBlossom

          Then Moses and the Israelites sang this song to the Lord:

          “I will sing to the Lord,

          for he is highly exalted.

          Both horse and driver

          he has hurled into the sea.
          Then Miriam the prophet, Aaron’s sister, took a timbrel in her hand, and all the women followed her, with timbrels and dancing.

          • aldownunder

            BORING….

          • SnodtBlossom

            24 So they saved it until morning, as Moses commanded, and it did not stink or get maggots in it. 25 “Eat it today,” Moses said, “because today is a sabbath to the Lord. You will not find any of it on the ground today. 26 Six days you are to gather it, but on the seventh day, the Sabbath, there will not be any.”

            27 Nevertheless, some of the people went out on the seventh day to gather it, but they found none. 28 Then the Lord said to Moses, “How long will you[c] refuse to keep my commands and my instructions?

      • LIZ THE SHIZ

        dream on the only plug they will pull is on Hillary’s life support

      • Jerry C

        My gut says two years in after LUITPOS goes to become the next Secretary General of the U.N.

  • Mondobeyondo

    One phrase comes to mind:

    Cash For Clunkers!!

    Woo-hoo! It worked before right? Ummm… *sigh*

    • SnodtBlossom

      As long as Moses held up his hands, the Israelites were winning, but whenever he lowered his hands, the Amalekites were winning. 12 When Moses’ hands grew tired, they took a stone and put it under him and he sat on it. Aaron and Hur held his hands up—one on one side, one on the other—so that his hands remained steady till sunset. 13 So Joshua overcame the Amalekite army with the sword.

      • watchmannonthewall

        “And when Phillip had run up , he heard him reading Isaiah the prophet, and said to him, ‘Do you understand what you are reading?’

        And he [the Ethiopian eunuch] said, ‘How can I understand, unless someone guides me?’
        And he invited Phillip to come up and sit with him…
        And the eunach answered Phillip and said, ‘Please tell me, of whom does the prophet say this? Of himself, or of someone else?’

        And Phillip opened his mouth and beginning from THIS scripture [Is 53:7-8] he preached unto him Jesus.” (Acts 8:30-35)

        Do you realize you also are preaching Jesus, from among all these passages you have quoted?
        Yet, somehow, it seems as if you are in the same chariot as the eunuch, asking, “Of whom does the prophet say this?”

        • SnodtBlossom

          9 The Lord said to Moses, “I am going to come to you in a dense cloud, so that the people will hear me speaking with you and will always put their trust in you.”

          • watchmannonthewall

            “Do not think that I will accuse you before the Father; the one who accuses you is Moses, in whom you have set your hope [trust].” (John 5:45)
            Jesus said your quote had been fulfilled over 1400 years later, and they still put their trust in Moses today, rather than in Jesus.

            Of course, that is because many Christians portray Jesus as a pig eating, pagan god/godess holiday keeping, new law making Jesus who is made up out of the figment of their imaginations, or early Roman Catholicism rather than out of the historical facts of scripture.

            Great verse with many implications!

            And of course we know that though they put their “trust” in Moses, they have taken what he said and spun it (yes, spinning words has been going on for millenniums) so that they can add their own words to it to supercede Moses’ words. They even claim Moses gave them this authority to change God’s Word. This is what Kabbalah is all about. So truth to be told, they really don’t trust Moses, though they claim to. Same is true for many regarding Jesus!

    • LIZ THE SHIZ

      sounds like 2007 / 2008 all over again, now’s a good time to go into the auto repo business

      • Richard O. Mann

        Yep. They should be seeing a major uptick in their biz.

        • LIZ THE SHIZ

          bring back Lizard Lick Towing

  • watchmannonthewall

    How about just wait until after the election and the Christmas pink slips start getting handed out like they have in past downturns. I don’t think it will matter who wins, but certainly the blame will be assigned differently based on the winner.

  • JC Teecher

    “The average size of an auto loan is also at a record high. At $29,880, it is now just a shade under $30,000.”

    That is unbelieveable but true. Some people drive vehicles that are costing more than the old mobile homes they live in. A lot of people are driving around in vehicles that cost what a half acre and small wood siding house used to cost.

    There is an old saying about driving around in a Cadillac, on a
    Volkswagen budget.
    Lord help them, for they are a sottish (stupid) people.

    • SnodtBlossom

      Throughout the night the cloud brought darkness to the one side and light to the other side; so neither went near the other all night long.

      21 Then Moses stretched out his hand over the sea, and all that night the Lord drove the sea back with a strong east wind and turned it into dry land. The waters were divided, 22 and the Israelites went through the sea on dry ground, with a wall of water on their right and on their left.

      23 The Egyptians pursued them, and all Pharaoh’s horses and chariots and horsemen followed them into the sea. 24 During the last watch of the night the Lord looked down from the pillar of fire and cloud at the Egyptian army and threw it into confusion. 25 He jammed[b] the wheels of their chariots so that they had difficulty driving. And the Egyptians said, “Let’s get away from the Israelites! The Lord is fighting for them against Egypt.”

      • aldownunder

        BORING…

        • SnodtBlossom

          31 The people of Israel called the bread manna.[d] It was white like coriander seed and tasted like wafers made with honey.

        • old fart

          Moses sucks.

    • Richard O. Mann

      Here in the South, it use to be a standing joke about black people in the South. They would live in a run down shack of a house, but had to drive a new Caddie and have a color TV. That was before the government set them up with government housing. You still see the Caddies, and various other nice rides around the projects. And satellite dishes. When the government does finally run out of money, it is going to be one big mess.

      • Raymond Chow

        They’re already out of money everything is now borrowed and paid with printed paper or digital number. $19.5 trillion in debt, I don’t know how it will be paid? I suppose it will be paid in printed paper or maybe the holder of the printed paper debt will just buy California with it.

  • paul mullin

    The problem is that no lessons were learned in 2008. There was no remorse, no repentance. No national upheaval, no change. The insatiable greed is still there, it hasnt gone anywhere. Instead of selling 5 mortgages in one day the lenders are selling 50 car loans. The interest junkies are still in full blown addict mode, That does not bode well for a nation that has been given chance after chance by God. Is any of y’all Catholic out there? I know Michael isn’t. But the Holy Father declared this year as a Year of Mercy. That year ends on November 20th. What would y’all suppose follows Mercy? You said it. JUSTICE. Almighty God delayed the Shemitah of 2015 to extend one last chance for Mercy. A chance to return to Him, to return to His love, His Peace. He wants so desperately for ALL His children to be saved. ‘He desires the salvation of ALL men’. But His hand is heavy across both our nations and His Mercy is running out. Prepare. Weep. Put on sackcloth. Fast. Pray, Pray, Pray.

    • Bob332

      Spot on!

      • SnodtBlossom

        43 The Lord said to Moses and Aaron, “These are the regulations for the Passover meal:

        “No foreigner may eat it. 44 Any slave you have bought may eat it after you have circumcised him, 45 but a temporary resident or a hired worker may not eat it.

        46 “It must be eaten inside the house; take none of the meat outside the house. Do not break any of the bones. 47

        • aldownunder

          BORING..

          • SnodtBlossom

            Then Moses led Israel from the Red Sea and they went into the Desert of Shur. For three days they traveled in the desert without finding water. 23 When they came to Marah, they could not drink its water because it was bitter. (That is why the place is called Marah.[f]) 24 So the people grumbled against Moses, saying, “What are we to drink?”

            25 Then Moses cried out to the Lord, and the Lord showed him a piece of wood. He threw it into the water, and the water became fit to drink.

    • SnodtBlossom

      22 Take a bunch of hyssop, dip it into the blood in the basin and put some of the blood on the top and on both sides of the doorframe. None of you shall go out of the door of your house until morning. 23 When the Lord goes through the land to strike down the Egyptians, he will see the blood on the top and sides of the doorframe and will pass over that doorway, and he will not permit the destroyer to enter your houses and strike you down.

      • aldownunder

        BORING.

        • SnodtBlossom

          13 That evening quail came and covered the camp, and in the morning there was a layer of dew around the camp. 14 When the dew was gone, thin flakes like frost on the ground appeared on the desert floor. 15 When the Israelites saw it, they said to each other, “What is it?” For they did not know what it was.

          Moses said to them, “It is the bread the Lord has given you to eat. 16 This is what the Lord has commanded: ‘Everyone is to gather as much as they need. Take an omer[a] for each person you have in your tent.’”

      • LIZ THE SHIZ

        you know we can all watch the Ten Commandments on Netflix instead of reading the SnodtBlossom’s version of the Old Testament

        • SnodtBlossom

          Amen Brather

          • LIZ THE SHIZ

            praise the lord MAMNN

    • Jack Frost

      Not completely true, one lesson well learned is the Fed will move heaven and earth in order to maintain the status quo appearance. Unless you are unlucky enough to be the first one to implode. Why on earth people still accept worthless federal paper for debt payment is a mystery. but way back when, tulip bulbs were the most valuable items on earth. Until suddenly they weren’t and people were ruined en mass.

    • randy wellman

      yes, i’m a catholic…my question is why are we letting those priests get away with molesting all those little kids? i went to confession yesterday, sat down, and the priest asked what sin have you commited, my son?….i said YOU FIRST!

  • Uzal Roberts

    Stock up on items that you can easily barter.

    • SnodtBlossom

      17 Moses’ father-in-law replied, “What you are doing is not good. 18 You and these people who come to you will only wear yourselves out.20 Teach them his decrees and instructions, and show them the way they are to live and how they are to behave. 27 Then Moses sent his father-in-law on his way, and Jethro returned to his own country.

  • kathym2

    I am surprised we have gone on as long as we have.

    • SnodtBlossom

      6 For seven days eat bread made without yeast and on the seventh day hold a festival to the Lord. 7 Eat unleavened bread during those seven days; nothing with yeast in it is to be seen among you, nor shall any yeast be seen anywhere within your borders. 8 On that day tell your son, ‘I do this because of what the Lord did for me when I came out of Egypt.’ 9 This observance will be for you like a sign on your hand and a reminder on your forehead that this law of the Lord is to be on your lips. For the Lord brought you out of Egypt with his mighty hand. 10 You must keep this ordinance at the appointed time year after year.

      • aldownunder

        BORING

        • SnodtBlossom

          19 Then Moses said to them, “No one is to keep any of it until morning.”

          20 However, some of them paid no attention to Moses; they kept part of it until morning, but it was full of maggots and began to smell. So Moses was angry with them.

          21 Each morning everyone gathered as much as they needed, and when the sun grew hot, it melted away.

  • JJR

    As someone that’s paid for cash for every car ive bought since I was 15 y/o its shocking that people would pay this kind of money for transportation. Factor in the full coverage auto insurance required and the monthly payments go even higher. I cant even imagine the maintenance and repair costs once the warranty expires since most new cars come with everything from built in taking computers to cappuccino machines.

    You can buy a decent used Toyota or Honda for less than $5K and just pay liability insurance. Most are just getting broke in at 100K miles and will easily give you another 100K+ miles with minimal repairs. Car breaks down, the salvage yards are full of quality used parts at low prices.

    Ive never allocated more than 10% of our budget for transportation.

    • Jerry C

      I’m waiting on 3D printers to print whole cars & parts from metal scraps & such…still waiting.

    • Charles Murray

      I agree with you 100%. I inherited my daughter’s 2002 Infiniti G20 (the little one) a couple of years ago and drove it as a gag to irk my sales manager who drives an Acura, BMW, and a Benz. Since that time it’s kind of grown on me and despite having 203,000 miles, it got 30.6 mpg this past weekend. I know it won’t last forever, but for the time being I’m having a blast!

    • Pic889

      The big three will fund people with low credit rating. Anything to move the metal from dealer lots. Hell, Dodge will fund a stray dog as long as it doesn’t pee on the showroom floor.

      So, if you already have bad credit rating and don’t care about it becoming worse, up until very recently you could go to a big three car lot and pick up your free car and drive it to your heart’s content ’till it gets repossessed and the manufacturer takes the depreciation hit. But I guess this made sales numbers look good…

  • Chris Gerber

    I have said in the past that the auto market is going to price themselves out of business. Maybe that is coming to fruition..

    • Chris Gerber

      What may have to happen is that the car makers will have to reduce their prices heavily in order to stay in business. Banks are certainly not going to fall (fail) a second time around. I have noticed that they still do business the old way they have always done business.. haven’t learned a thing regarding their methods btw. But, the blame will fall on the car makers, I think.

      • alan

        They will import KIA’s and put Ford emblems on them, fixed!

  • Mike Smithy

    Getting that advanced liberal arts degree in Lesbian Studies from that institution of lower learning seemed like a good idea at the time.

    • df NJ

      Same thing with a degree in military history.

      • David Rodriguez

        Actually, if you are already in the army this can be a good thing for promotions.

    • alan

      ITT ?

      • Mike Smithy

        Yup. Personally, I hate being a lesbian trapped in a man’s body.

        • SnodtBlossom

          Cut it off and convert! 😀

          • Mike Smithy

            On second thought, I am not that committed to the cause. 😀

          • SnodtBlossom

            hey, her girlfriend was hot though, wasn’t she? maybe you’d get lucky..

          • Ricardo

            You won’t know how. I’ll leave it to you to decide whether I mean convert or cut it off.

          • LIZ THE SHIZ

            I knew the truth would finally come out , you got my Transbar antenna pinging

          • SnodtBlossom

            yeah well.. you always had mine going 🙂

          • suck an blo sum

            Please block suck blo som from posting. The thing is posting and taking valuable space from those that have intelligent thing to share.

          • SnodtBlossom

            I’m helpful.. I’ll cut it off for him 🙂

          • jaxon64

            Agreed–I am for freedom of speech for even those with the ideologies I find distasteful. However SB is purely on here as diversion from intelligent discourse of the topic ( and so many play his/her game and get into 3rd grade “I know you are but what am I” childish arguing.)
            I get frustrated trying to scroll down through all of the pointless blatherings to find any relevant comments.
            Blocking SB would not be censoring “free speech” as much as disciplining a mouthy child and making them sit quietly in their room by themselves.
            Michael, please, enough is enough–you won’t be censoring content, only establishing rules for decorum–big difference.

      • SnodtBlossom

        My coworker was in her final year of schooling with them. She got the word today. Now she’s looking to relocate away from us for schooling.

        • Richard O. Mann

          Any good 2 year trade schools located in the area? Don’t know if they will accept credits from ITT, but if she can find one close by, would save her the expense of moving.

          • Raymond Chow

            Go to a JC…they offer the same trade technical degrees.

          • SnodtBlossom

            jc?

          • Jerry C

            Junior College?

    • LIZ THE SHIZ

      I can get a degree in lesbian studies in Provincetown Ma. for the price of a cup of coffee and a good seat at Dunkin Donuts

    • Jerry C

      That made me laugh. Thanks.

    • Pic889

      I just use the automatic dispenser for my Gender Studies and Liberal Arts degree needs

      kappit(dot)com/img/125489/pull-for-arts-degree/

    • Carole

      Well said…lol

  • df NJ

    The best way to get rid of the debt bubble is raise salaries. You can have consumer inflation higher than wage inflation for 40 years straight and expect a good result. CEOs need to reward people who work for living for a change.

    How about helicopter debt relief for anyone who has less than 10 years left on any 30 year mortgage. That would spur the economy!

    How about cracking down on the drug companies charging $614 for an EpiPen than used to cost $57. I wish the Republicans would take a break for attacking the Arabs and go after the terrorist CEOs running companies like Mylan.

    • J.L.W

      Paying off debt is massively deflationary.

      • socalbeachdude

        No. It most certainly is not, and the proceeds of the debt payments would SIMPLY BE REINVESTED in new ventures which would be very good for overall economic growth.

    • pokerchip

      “The best way to get rid of the debt bubble is to raise salaries.”

      No, that would only allow people to afford higher payments on additional debt, not to mention, what that would do to our already massive unemployment problem.

    • DigitalThumb

      Companies are more likely to cut wages than put them up. We live in a deflationary environment. Rising stock prices are not linked to falling earnings in this Alice in Wonderland world we live in. The system is broken.

      • socalbeachdude

        Correct, and rising stock prices are nearly exclusively due to MASSIVE CORPORATE SHARE BUYBACKS BY COMPANIES which are now more than $14 trillion in debt.

    • socalbeachdude

      Huh? Who would pay for increased salaries? Don’t you realize that INCREASED WAGES ARE THE MOST INFLATIONARY THING THAT COULD HAPPEN?

      Obviously there will be no “helicopter money” for anyone and the Federal Reserve and other central banks NEVER GIVE ANY MONEY TO ANYONE.

      As to MASSIVE EGREGIOUS PRICE GOUGING in the medical industry that is certainly something that needs to be investigated and tightly regulated.

  • robert

    And we are worried about a football player sitting on his butt during the national anthem. Bah! The whole system is coming unglued.

    • J.L.W

      Yes well, what that man represents is Black Lives Matter. Which is the beginning of the end of civilised society.

      • Andrew Cooler Can

        and we wasted billion of $ trying to find dark matter when it’s under our nose all along. I declare Dark matter is Black Lives Matter.

      • socalbeachdude

        Nope. It’s just another little social rights group.

      • Pic889

        Go to a black ghetto unarmed and see if White Lives Matter…

    • SnodtBlossom

      4 Then the Lord said to Moses, “Write this on a scroll as something to be remembered and make sure that Joshua hears it, because I will completely blot out the name of Amalek from under heaven.”

      15 Moses built an altar and called it The Lord is my Banner. 16 He said, “Because hands were lifted up against[c] the throne of the Lord,[d] the Lord will be at war against the Amalekites from generation to generation.”

    • Mike

      Hope you have some food stocked and a few guns with plenty of ammo. The Roman empire didn’t collapse in a few days either. Took years.

      • socalbeachdude

        And what good would “guns and ammo” do?

        • TSA_TheSexualAssault

          If the Romans had guns, I’d be typing good Latin.

  • Jack Mccarthy

    You can not control debt, wages, inflation,deflation if you do not control the value of the currency. Your currency was UNLAWFULLY given to a for profit federal reserve bank, not FEDERAL no reserve. If you do not know the definition of a dollar start your research there. Then read Article 1 sec 10 of the U.S. constitution

    • socalbeachdude

      The US dollar has BEEN SOARING UPWARDS in value on the DXY and in purchasing value of the past several years and the current big complain about the US dollar is that it is FAR TOO STRONG AND GETTING STRONGER.

      The US constitution SAYS NOTHING ABOUT THE US DOLLAR NOR ABOUT GOLD AS YOU ASSERT. As to the US Constitution, Article 1 Section 10 of the Constitution of the United States certainly does NOT “say that States shall only use Gold and and Silver coin” AND SAYS NOTHING AT ALL ABOUT WHAT THEY USE (key word) for money, but rather simply PROHIBIT STATES FROM CREATING THEIR OWN MONEY OR CURRENCY IN ANY FORM OTHER THAN GOLD OR SILVER.

      • Tyranny’s Foe

        Please the read the book The Creature Fron Jekyll Island. It debunks every point this guy is claims as fact.

        • socalbeachdude

          That “creature” book was originally written by G. Edwards Griffin in 1994 and is nothing but a piece of bogus and blatantly false propaganda garbage and little else. Its absurd assertions have been thorough and totally debunked and what is left of the 1% of factoids remaining there are of no significance whatsoever and the entire point of the book is to promote fantastical and inane and false conspiracy theories about the Federal Reserve System.

          The Story Behind ‘The Creature From Jekyll Island,’ the Anti-Fed Conspiracy Theory Bible

          The Fed was secretly created to enact vicious cycles of genocide. Or so this popular book would have you believe.

          It’s the kind of conspiracy theory so all-encompassing that it explains the very roots of all modern American wars, depression, economic boom, and (most importantly!) the darkest, best-kept secrets of international banking.

          Typically, the Federal Reserve is a government entity that frustrated high schoolers in America are forced to learn about before entering adulthood and forgetting exactly what it is or why it exists. The Fed is our central banking system that was created at the tail end of 1913 as a response to a string of financial crises. It is responsible for implementing the United States’s monetary policy, and is routinely and aptly described as “boring.”

          It’s all fairly mundane and unsexy (though hugely consequential) stuff. The Fed doesn’t bomb anything, invade anything, or even tax anything.

          The fatal flaw in Griffin’s analysis and breathless fear-mongering is, as is the case with so many prevalent conspiracy theories, that it takes a grain of truth and turns it into a salt mine of utterly laughable BS.

          http://www.thedailybeast.com/articles/2015/11/26/the-story-behind-the-creature-from-jekyll-island-the-anti-fed-conspiracy-theory-bible.html

          The US government is in debt to the tune of more than $19.5+ trillion because CONGRESS is grossly profligate and financially irresponsible and that has nothing to do with the Federal Reserve, its operations, its policies, or its structure.

  • J.L.W

    Looks like it could come down the end of September.

    Dollar is being attacked on many fronts and they might rate hike to try and protect it.

    It’s great having someone who does nitty legwork for these subjects. I lack the mindset to have written this post, including having the idea to write it in the first place.

    • socalbeachdude

      Absolutely false. The US dollar is MORE IMPORTANT THAN EVER and will soon be over 100 on the DXY.

      AEP: Dollar hegemony endures as share of global transactions keeps rising

      The US dollar is tightening its grip on the global financial system at the expense of the euro, entrenching American hegemony and rendering the US Federal Reserve more powerful than at any time in history.

      Newly-released data from the Bank for International Settlements (BIS) show that the dollar’s share of the $5.1 trillion in foreign exchange trades each day has continued rising to 87.6pc of all transactions.

      It is the latest evidence confirming the extraordinary resilience of the dollar-based international order, confounding expectations of US financial decline a decade ago.

      Roughly 60pc of the global economy is either in the dollar zone or closely tied to it through currency pegs or ‘dirty floats’, and the level of debt issued in dollars outside US jurisdiction has soared to $9 trillion.

      http://www.telegraph.co.uk/business/2016/09/01/dollar-hegemony-endures-as-share-of-global-transactions-keeps-ri/

  • MeMadMax

    Now think about what will also happen to the auto manufactuers and their supply(parts) lines: They are gonna be dealt another blow…

    Do we have serious reason to believe that they can survive another meltdown?
    Ford might live, GM I doubt….

  • Thomas D Guastavino

    Question. Does the $ 1 Trillion include the auto lease market? Only people with good credit can get a lease so if the trillion is straight auto loans then it is pretty bad.

    • socalbeachdude

      Vehicles lease are NOT LOANS so are not included in the loan numbers.

  • billtheguy

    I used to work for an automotive supplier. The auto giants beat you down on your quote to get the work, and then, in their contract, require 10% back the first year and 5% back the following years. ?? You just quoted your lowest price to get the work? And they say “you will get more efficient in manufacturing the part.” That would be my profit. Then you go to the dealer and try to buy that part. Guess what? It’s marked up some 700%. The only people who can afford the new cars are the second layer of management at GM, Ford, Chrysler, Kia, Honda, etc. Unless you want to keep up with your neighbor!

    • LIZ THE SHIZ

      I got a great deal on used Takata air bags, they still have some sharp metal fragments packed in them

  • Priszilla

    Those with the largest debt are bailed out by the taxpayers.

    • socalbeachdude

      Nope.

  • DigitalThumb

    Has anyone else noticed reality doesn’t match the narrative. Here in the UK we are being told that things are great, but I just lost my job because the company I worked for is losing contracts left right and centre, local companies in the same engineering sector (Building services) are all laying off as well.

    It’s a bit like the stowage passengers on the Titanic being told everything is OK, you will be in New York in the morning. They left the bit out about body bags though.

    • LIZ THE SHIZ

      sounds like Brexitphobia , how dare you go against your global elite overlords

      • DigitalThumb

        Actually I voted for Brexit, I don’t think it has anything to do with the downturn, things were slowing before the vote. Remember article 50 hasn’t even been invoked yet so it’s business as usual. My company did a lot of work for the rich in London new taxation on property purchases in April just cut the legs from under our sector. A friend of mine still works for the firm texted me today they have just lost another big contract.

        • Paul Patriot

          I have read that the globalists are working hard behind the scenes with those in power to cripple the UK by various means to punish them for voting for Brexit.

          I hope and pray the folks of that great land stand firm!!!! And don’t compromise or give an inch! There may be some hard times ahead, but at least you have a chance at maintaining your sovereignty and making UK great again.

          Great economic troubles are coming to try to get you to reconsider your “bad decision” to exit the EU, but, please stay the course and stand firm. The future depends on it.

          • DigitalThumb

            The people of the UK are more outwardly looking than say the average American. We know life is going to be tough, but it would be far worse to be shackled to the EU. The British are stoic and we will prevail. There will be no going back on BREXIT.

          • socalbeachdude

            Nope. It will be VASTLY WORSE for everyone in the UK once Article 50 is actually invoked and the UK is forced to leave the EU.

          • socalbeachdude

            The UK WILL BE CUT OFF AS TO ALL THE PRIVILEGES IT NOW HOLDS AS A MEMBER OF THE EUROPEAN UNION ONCE IT EXISTS THE EUROPEAN UNION. You apparently have little to no comprehension at all based on your comments as to what the EU even is.

            The EU is a COUNTRY CLUB literally formed by a club of 28 (soon to be only 27) member countries who get very substantial privileges by being a member of that club. Once a country withdraws such as the UK now voted to do, then the privileges it held as a member NO LONGER EXIST. That includes passporting as related to financial concerns in all of the other countries of the EU, open borders to the EU, the benefits of the common market of the EU, and the benefits of the common legal system of the EU, among a vast array of other benefits and privileges AFFORD ONLY TO MEMBERS.

            The UK is and will remain one of the MOST INDEBTED COUNTRIES IN THE WORLD on a per capita basis and that situation will become vastly worse as the UK economy sinks dramatically as a result of withdrawing its membership in the EU common markets and as its passporting privileges for the financial sector are rescinded.

            Moreover, the UK itself will begin to implode with Scotland moving to exit the UK without delay which is certain to pass with about a 60% majority and then immediately join the EU as an independent country which will then bring the EU membership back up to 28 countries. The loss of economic revenues to the UK from the withdrawal by Scotland will be very substantial as will the impact to UK tax revenues.

            The EU economies are THRIVING and will continue to do so and those countries that are members of the EuroZone will continue to see a very strong currency while the UK’s pound sterling rapidly sinks towards and to parity with the US dollar before heading lower.

        • socalbeachdude

          Obviously, you have zero comprehension of the matter of Brexit which is resulting in political, economic, and financial catastrophe throughout the UK with a plunging pound and stock markets and reverberating into more than $2 trillion of losses throughout the global financial system during the 3 business days days of that disastrous vote which ensures the rapid and very substantial collapse of the UK.

    • socalbeachdude

      The vipers destroying things – particularly their own lives – and livelihood are the pitiful and pathetic little anarchists who do not even comprehend what the European Union is or does, but they will soon be learning the hard way as many of them lose their jobs and as the price of things purchased in the UK pound sterling soars by 20% or more over the coming months and as the value of any assets they may own falls sharply – for which they have ONLY THEMSELVES TO BLAME.

      Both Lord Rothschild and George Soros made that very clear.

      The Brexit crash will make all of you poorer – be warned – George Soros

      My 60 years of experience tells me the pound will plummet, along with your living standards. The only winners will be speculators.

      International Monetary Fund and others have been attacked by the leave campaign for exaggerating the economic risks of Brexit. This criticism has been widely accepted by the British media and many financial analysts. As a result, British voters are now grossly underestimating the true costs of leaving.

      Too many believe that a vote to leave the EU will have no effect on their personal financial position. This is wishful thinking. It would have at least one very clear and immediate effect that will touch every household: the value of the pound would decline precipitously. It would also have an immediate and dramatic impact on financial markets, investment, prices and jobs.

      The Bank of England, the Institute for Fiscal Studies and the IMF have assessed the long-term economic consequences of Brexit. They suggest an income loss of £3,000 to £5,000 annually per household – once the British economy settles down to its new steady-state five years or so after Brexit. But there are some more immediate financial consequences that have hardly been mentioned in the referendum debate.

      To start off, sterling is almost certain to fall steeply and quickly if there is a vote to leave– even more so after yesterday’s rebound as markets reacted to the shift in opinion polls towards remain. I would expect this devaluation to be bigger and more disruptive than the 15% devaluation that occurred in September 1992, when I was fortunate enough to make a substantial profit for my hedge fund investors, at the expense of the Bank of England and the British government.

      It is reasonable to assume, given the expectations implied by the market pricing at present, that after a Brexit vote the pound would fall by at least 15% and possibly more than 20%, from its present level of $1.46 to below $1.15 (which would be between 25% and 30% below its pre-referendum trading range of $1.50 to $1.60). If sterling fell to this level, then ironically one pound would be worth about one euro – a method of “joining the euro” that nobody in Britain would want.

      https://www.theguardian.com/commentisfree/2016/jun/20/brexit-crash-pound-living-standards-george-soros

  • greanfinisher .

    Hmmm…..I thought that these sub-prime auto loans were simply sold by the dealerships to Wall Street investment banks, and subsequently repackaged into securities. In that regard, it seemed to me that those who purchased those securities would bear all of the risk.

    • df NJ

      You would think. But what will happen is the tax payers will bail out the investors. Maybe we need to have the death penalty for breaking banking laws.

      • greanfinisher .

        The banking laws were broken when Clinton signed onto the infamous 1999 Gramm-Leach-Bliley Act which repealed the 1933 Glass-Steagall Act.

        • Jerry C

          No. It was broken in 1913. Clinton just made the brake a little faster.

          • greanfinisher .

            One can thank Woodrow Wilson for that favor (to the bankers).

          • socalbeachdude

            There was no “favor” at all to bankers.

            America was economically nothing but a backwater banana republic of little to no significance during the period in US history prior to 1913 when the Federal Reserve was created. It was riddled with economic crises, panics, and near collapse by the mid 1860s during the “unpleasantness” culminating in the catastrophic FINANCIAL PANIC OF 1907.

            As to the value of the US dollar over the past 100 years…

            No, the dollar did NOT really lose 95% of its value since 1913

            Let us take at the period from 1913-2006, where we have complete data. So what do they mean, when they say the dollar lost 95.1% of its value in those 93 years? Essentially, an average good/service that cost $1 in 2006, used to be priced at 4.9 cents in 1913. In other words, the average price level of goods/services increased by 1930% since 1913. True, but guess what, average earned income increased by 6560% during the same time period. Average earned income rose from $740/yr in 1913 to $49,300/yr in 2006. Adjusting for inflation, $740/yr in 1913 is $15,000/yr in 2006 dollars. Average incomes, not only kept pace, but beat price inflation by 230%.

            So does it make any sense all to say the dollar lost value? In reality, the REAL purchasing power of the average American, has increased by 230% in the past century. Sure, prices were cheap in 1913, but $740/yr doesn’t buy you a whole lot, not anymore than 15,000/yr today.

            http://realfactbias.blogspot.com/2012/02/no-dollar-did-not-really-lose-95-of-its.html

            There were no “secret loans’ made at all by the Federal Reserve and at no time during 2008-2009 was there ever more than $1 trillion outstanding in any sort of loans through the Federal Discount Window and all of those loans WERE IMMEDIATELY REPAID IN FULL TO THE FEDERAL RESERVE by those who borrowed from the Federal Reserve.

            The QE funds created by the Federal Reserve HAVE ALWAYS REMAINED FULLY INSIDE THE FEDERAL RESERVE and increase only the monetary base and not the money supply. They were used to purchase EXISTING SECURITIES with those funds deposited into the EXCESS RESERVES accounts of the banks inside the Federal Reserve which is where they always remained are are right now.

            Money Stock Measures – H.6

            http://www.federalreserve.gov/releases/h6/

          • socalbeachdude

            Absolutely false. The banking industry was a tiny little disorganized and unstable shadow of itself back in 1913 and grew to be the best, strongest, and largest banking system in the world from 1913 through 2016.

          • greanfinisher .

            That must be why a dollar in 1913 is now worth two cents.

          • socalbeachdude

            Absolutely false. The US dollar has not been in any way “debased” by the Federal Reserve over the past 100 years. The very substantial increase in wages is what, of course, created the perception that it was debased. That is also the reason why the Federal Reserve keeps such a close watch over wages to be sure they don’t rise which is an effort they have been very successful with over the past 10 years.

            The Federal Reserve certainly did not attempt to “print its way to prosperity” at all and 100% of the Federal Reserve QE funds have always remained fully inside the Federal Reserve where they are in the primary required and excess reserves accounts of the banks there where they were deposited as the proceeds for the purchases of existing securities by the Federal Reserve.

            The total debt outstanding in the US is right around $60 trillion and less than one-third of that is US government debt. The breakdown of the $60 or so trillion of DEBT outstanding is approximately as follows by big picture category:

            30% Federal Government Debt
            20% Total Consumer Debt
            23% Total Corporate Debt
            27% Other debt including Municipalities

            The federal government debt is presently around $18.672 trillion, Total consumer debt is around $12 trillion which includes about $1 trillion in consumer unsecured credit, $1 trillion in vehicle loans, $1.36 trillion in student loans, and about $8.64 trillion in real estate loans secured by mortgages.

            The total corporate debt is around $14 trillion with a large percentage of that outstanding on corporate bonds which now have average interest rates of around 8.83%. The balance is a mix of all other types of debt outstanding with the largest portion of that $16 trillion being municipal bonds issued by state and local authorities and agencies.

            The total M1 money supply in the US is only $3 trillion and only $1.3 trillion of that is printed currency. This is confirmed by the Federal Reserve H.3 report:

            http://www.federalreserve.gov/releases/h3/current/

            M2 which includes M1 plus savings balances is only around $12 trillion and has not increased by $4 trillion since 2008. None of the QE funds increased the money supply at all but only served to increase the MONETARY BASE with 100% of those funds remaining inside the Federal Reserve.

            That LITTLE BIT OF MONEY supports the largest economy in the world which is now an $18 trillion a year economy.

        • socalbeachdude

          Nope. It simply became COMINGLED as to 1) commercial retail banking, 2) investment banking and brokerages, and 3) other financial matters including insurance. That said, the Glass-Steagall Act of 1934 should be re-instated in its entire 34 page entirety and the entire Gramm Leach Bliley Financial Services Modernization Act of 1999 should be repealed.

      • socalbeachdude

        Taxpayers do not ever “bail out investors” and in the case of the old GM in 2008 both the bond holders and shareholders were TOTALLY WIPED OUT by the Chapter 11 Section 63 bankruptcy which was also the case with Chrysler.

    • LIZ THE SHIZ

      and those vehicles will eventually end up in Syria in an ISIS motorized platoon

      • greanfinisher .

        One never knows.

  • Rhino Horns

    The only reason the “stock market” is fine is due to the Federal Reserve printing money and buying shares to ramp it green, which enriches the 1% and impoverishes the 99%.

    • greanfinisher .

      The Federal Reserve was designed for the privileged few.

      • socalbeachdude

        Absolutely false. The Federal Reserve is MERELY A CENTRAL BANK and was designed to serve the interests of its member bank shareholders through its 12 regional banks.

        It certainly does not “run the country” at all and has NOTHING WHATSOEVER TO DO WITH POLITICS but it is NOT SOME KIND OF GOVERNMENT WELFARE AGENCY OR CHARITY as you apparently want or perceive it to be.

        • greanfinisher .

          Yes, that must explain why former President Woodrow Wilson regretted his decision in signing the Federal Reserve Act into law in 1913. In regards to running the country, that must be why Mayer Amschel Rothschild wrote: “Give me control of a nation’s money and I care not who makes the laws”. Incidentally, the Rothschilds maintain control over all of the world’s central banks.

          • socalbeachdude

            Woody was a dimwit and imbecile and got his claim to fame by become a leader in the so-called very stupid “Progressive Movement” back in the early 1900s and was elected President of the US and served as the 28th President of the United States from 1913 to 1921.

            Woody was a HYPOCRITE to the first degree and ran for President in 1916 the around the slogan “He kept us out of war” and yet was the primary cause of WWI which broke out during his second term and he was the primary driver behind anti-war movements during his second term.

            As to Janet Yellen, she is a wonderful and brilliant lady and we are very fortunate to have her as Chairman of the Federal Reserve System where she is doing a wonderful job working to raise the only 3 interest rates they set (even though they don’t matter a hoot in the actual economy) and she and the FOMC recently doubled the interest paid to banks on IOER (Interest On Excess Reserves) on December 16, 2015 which was a nice little boost for the beleaguered banking industry in the US.

    • socalbeachdude

      Absolutely false. The Federal Reserve has NOTHING WHATSOEVER to do with the US stock market and does not own a single share of equities (stock).

      The US stock markets are elevated nearly entirely due to CORPORATION STOCK BUYBACKS on borrowed funds and corporate debt now exceeds $14 trillion.

      By the way when stocks rise in value, that does not “impoverish” anyone at all.

      • Rhino Horns

        You are very ignorant of the dark pools of money that the Federal Reserve uses to prop up these markets, just like the Bank of Japan, The Swiss National Bank and others are doing overtly. Ever notice how the markets ramp up generally in the last half hour of trading after doing the sideways shuffle most of the day? Yes, part of the reason for elevated markets are due to corporate buybacks. And I didn’t say that when stocks rise in value, it impoverishes people. I said when the Fed prints money it impoverishes people.

        • socalbeachdude

          Absolutely false. The Federal Reserve does no such thing at all. There is a VAST SHADOW BANKING SYSTEM IN THE US totally outside of the regulated US banking system controlled by the Federal Reserve, and it is that shadow banking system you are talking about which has NOTHING WHATSOEVER to do with the Federal Reserve.

          Shadow banks make diciest loans while Wall St. retains risk – Bloomberg

          http://www.bloomberg.com/news/articles/2016-05-16/shadow-banks-make-diciest-loans-while-wall-street-retains-risk

          What has happened since the 1980s is the development of a VAST SHADOW BANKING SYSTEM totally outside of the much small regulated banking stem in the US. The total size of the regulated banking system administered by the Federal Reserve is only around $13 trillion, whereas the size of the shadow banking system in the US is now well over $25 trillion and includes pension funds, hedge funds, money market accounts, and the insurance industry and much of the debt in the US – even that originated within the regulated banking system – is SECURITIZED and sold into the markets which involve the shadow banking system.

          Interest rates on unsecured debt such as credit cards has NEVER BEEN HIGH IN HISTORY than it is now with hugely onerous interest rates of 12% to 35% on credit cards at a time when yields (interest rates) on US Treasuries (federal government debt) has NEVER BEEN LOWER AT ANY TIME IN HISTORY. Obviously, this has a very negative and real deleterious financial impact on the poor and middle class who are forced to borrow because they don’t have funds from income to meet their financial needs (and that includes student loans).

          The concept of RISK has been TOTALLY DISCARDED in the sovereign bond markets internationally including in US Treasuries and sovereign government debt has literally EXPLODED UPWARDS over the past 35 years to literally unbelievable levels with US government debt alone now exceeding $19.4 trillion. There is HUGE RISK OF DEFAULT in the sovereign and municipal loan markets and we are seeing that in Europe and even in the US with the territory of Puerto Rico now in default and with over $73 billion of debt which is simply not repayable as it stands.

          A number of intelligent folks like Bill Gross, Kyle Bass, Jeffrey Grundlach, and others have warned about these risks and mispricing, but the market participants have totally ignored these risks and we’re now at a point where both bond prices and stocks are at historic highs and moving higher and those two things should never be moving in the same direction in a market that properly prices risk. At some point in the not too distant future, RISK will become a much more important part of pricing of debt and the markets will see huge earthquakes from the levels at which debt is currently priced, and hopefully we will then start to see a return towards normalization, but that will come at a huge price of defaults and loss in the value of debt instruments.

          Keep in mind that prices of bonds are inverse to their yields and as prices fall on bonds yields rise. As yields rise that will cause huge problems for governments, corporations, and individuals with huge amounts of debt which is constantly being refinanced on an ongoing basis and the costs to service that debt will rise astronomically from the record low levels today.

          • Rhino Horns

            Can you tell me what is the purpose of the Federal Reserve?

          • socalbeachdude

            Obviously the purpose of the Federal Reserve is to act as the CENTRAL BANK in the United States to clear interbank transactions through its 12 regional banks along with the other usual, reasonable, and customary functions provided by a CENTRAL BANK.

            The Federal Reserve has done an absolutely superb job of managing the money supply and monetary policy in the US over the past 101 years during which time the US has become the biggest economy in the world and the wealthiest country in the world with over $180 trillion in assets which are offset by only about $60 trillion in debt resulting in around $120 trillion in net aggregate assets in the US..

            Without the Federal Reserve and its monetary policy and influence over the past, wouldn’t the US still be the irrelevant backwater banana republic that it was back in 1913 as opposed to the economic superpower of the world – by far – with the world’s reserve currency used in 85% of all global transactions and the wealthiest nation in the world with over $180 trillion in assets?

            The Federal Reserve has an excellent web site which explains all of the operations, functions, and details about the Federal Reserve and the Federal Reserve Act and anyone wanting to learn more about the Federal Reserve can peruse all of that information including their fully audited and highly detailed independently audited annual financial reports as well as a wealth of other information and statistics at:

            http://www.FederalReserve.gov

            The U.S. Federal Reserve Bank – How it Works, and What it Does – Money, Dollars, & Currency

            http://www.youtube.com/watch?v=y1OJlJ9COg0

          • Rhino Horns

            Thank you for this reply. Now I understand that you are just a shill for these criminal bankers. The Lake of Fire is going to be a most unpleasant place on Judgment Day for all you criminals, until you finally repent and make restitution for all your sins to the common people.

          • socalbeachdude

            Your gross and stupid disrespect for the FINE PROFESSIONALS in the financial system is beyond absolutely appalling.

  • A Dodgy Bloke

    I’ve been aware this for some time. There is a consumer show in my town that is always getting calls from people about cars. What happens is people get upside down in a car, they owe more then what the car is worth. They want to get a new one the amount owed on the old car is rolled into the new one. My car is a 2008 I take care of it, I have no car payments. I really don’t understand this thing people have about cars.

    • Richard O. Mann

      Status symbols. Watch how they are advertised these days and you will see they are pushed as being much more than just transportation.

      • Exactly what I was going to say. You beat me to it !

    • Jerry C

      Watching tv 24/7/365 eventually programs sheep to go in debt further to get the car they deservvvvveeeeeee. (make it sound like a sheep)

  • Cal

    In 1964 you could buy a Ford Mustang (One of the best models ever) for $2,000. 25% down with the remainder 3% interest loan paid off in 18 months. Three bedroom standard houses cost $12k. What happened to those days? Most people lived within their means and credit cards were few and far between. Long gone.

    • Jerry C

      All the Federal Reserve printing has made the dollar worthless. Reminds me of the scene in the movie Running Man when a gal asks her friend for $20 in change to get something out of the vending machine.

      • socalbeachdude

        Absolutely false. The Federal Reserve has been one of the MOST CONSERVATIVE central banks in the world when it comes to “printing money.” The most egregious by far is the PBOC followed by the BOJ.

        No, prices are not rising because of any “printing” by the Federal Reserve.

        The total M1 money supply in the US is only $3 trillion and only $1.3 trillion of that is printed currency. This is confirmed by the Federal Reserve H.3 report:

        http://www.federalreserve.gov/releases/h3/current/

        M2 which includes M1 plus savings balances is only around $13. None of the QE funds increased the money supply at all but only served to increase the MONETARY BASE with 100% of those funds remaining inside the Federal Reserve.

        That LITTLE BIT OF MONEY supports the largest economy in the world which is now an $18 trillion a year economy.

        Not a penny of the debt in the US was run up by the Federal Reserve at all.

    • goldminer

      In 1964 we were still on the gold standard. Life was good back then.
      In 1972 that all went away. It has been eazy credit and inflationville ever since.

      • socalbeachdude

        Absolutely false. Federal Reserve Notes are the LEGAL TENDER US CURRENCY and commodities junk like gold and silver have NO MONETARY PURPOSE OR UTILITY WHATSOEVER and are just HIGHLY VOLATILE LITTLE NICHE SPECULATIVE COMMODITIES and nothing more.

        The US dollar, like all currencies, is backed by the current and future assets and labor and productivity of the citizens of the issuing government which is VASTLY MORE VALUABLE than some little junk commodity such as gold or silver.

        The so-called “gold standard” was a very brief 60 year experiment from 1873 until 1933 which proved to be a VERY STUPID AND ABYSMAL FAILURE at which point it was thrown into the garbage bin of the most stupid notions in the history of the world and incinerated.

        The US long used a “silver standard” until that was discarded around 1870 and briefly replaced with the so-called “gold standard” which was totally discarded domestically in the US in 1933 as an entirely failed experiment. No currency can be limited to the production of some irrelevant “thingy” commodity such as gold or anything else when the population of that currency’s country is vastly expanding as was the case of the US by the 1930s.

        Nixon did not “abandon gold” at all. Nixon merely ended the Bretton Woods currency fixed exchange rate agreement which had been in force from 1944 to 1971.

        Nixon had nothing to do with the “gold standard” in the US which had long ago been TOTALLY DISCARDED BY THE US DOMESTICALLY back in 1933 and only a tiny shred of gold nonsense was even left in the form of international bank transaction convertibility which is what was discarded in 1971.

        Artificially constraining the growth of money supplies while the population is growing substantially CAUSES DEPRESSIONS and causes countries to fail economically.

        Moreover, the US dollar is backed by the full faith and credit of the US government and the US economy is by far the largest single country economy in the world.

    • socalbeachdude

      1964-66 Mustangs were HORRIBLE CARS and among the very worst junk ever put on the road.

  • JC Teecher

    Nothing says success like riding around in a new, or almost new looking car or pick-up. I know men that never haul anything other than groceries or a bale of pine straw once in a while, and they have to have a new $70.000.00 dually crew cab truck to do that with. No they don’t, cause it is all for show.

    Kind of reminds me of a story an old country preacher used to tell of a guy in the community that bought a nearly new car, just after A/C became available. He wanted people to think he had A/C, so he would ride through town or by the neighbors with his windows up in the summer.

    Many people like to act like they are wealthy, so they do with out of a lot of things, so they can look cool and uppity, in their new cars.
    We have three, none newer than 2004, but they are all paid for, well maintained,clean, and get an average of 30 mpg.

  • Mark8076

    I have a Mercedes convertible — paid $8500
    I have a customized Chevy truck — paid $4700
    My wife has a VW convertible — paid $6700
    Everyone thinks we’re nuts driving 10 year old cars with 100,000+ miles but I can’t justify paying $40K to $60K for a new car. Sure we have upkeep but it works out to an average of $35 a month per car — a lot less than a $499 a month car payment.

  • Sharon Coolidge

    I live in USA Florida and i am a happy woman today? I told my self that any Loan lender that could change my Life and that of my family, i will refer any person that is looking for loan to Them. If you are in need of loan and you are 100% sure to pay back the loan please contact them and please tell them that Mr Alfred Kessinger, Lynn referred you to them. am.invest@hotmail.com

  • Sharon Coolidge

    I live in USA Florida and i am a happy woman today? I told my self that any Loan lender that could change my Life and that of my family, i will refer any person that is looking for loan to Them. If you are in need of loan and you are 100% sure to pay back the loan please contact them and please tell them that Mr Alfred Kessinger, Lynn referred you to them. am.invest@hotmail.com/…

  • Sharon Coolidge

    I live in USA Florida and i am a happy woman today? I told my self that any Loan lender that could change my Life and that of my family, i will refer any person that is looking for loan to Them. If you are in need of loan and you are 100% sure to pay back the loan please contact them and please tell them that Mr Alfred Kessinger, Lynn referred you to them. am.invest@hotmail.com

  • Sharon Coolidge

    I live in USA Florida and i am a happy woman today? I told my self that any Loan lender that could change my Life and that of my family, i will refer any person that is looking for loan to Them. If you are in need of loan and you are 100% sure to pay back the loan please contact them and please tell them that Mr Alfred Kessinger, Lynn referred you to them. am.invest@hotmail.com…..

  • Not Impressed

    It is about time SnodtBlossom gets banned again (like it did before under another name). Please remove this parasite from this site or we should all stop reading the comments, as ǝɥs (it) ruins them. We could still read the articles though 😉

    • SnodtBlossom

      13 They are to be stoned or shot with arrows; not a hand is to be laid on them. No person or animal shall be permitted to live.’ Only when the ram’s horn sounds a long blast may they approach the mountain.”

  • soon

    School loans next please and hurry it up!!

    • socalbeachdude

      Student loans can NEVER BE CLEARED IN BANKRUPTCY and go with the borrower right up to the grave including garnishment of wages and Social Security.

  • Block snob blo sum

    Please block suck blo som from posting. It is posting and taking valuable space from those that have intelligent thing to share.

    • SnodtBlossom

      12 Put limits for the people around the mountain and tell them, ‘Be careful that you do not approach the mountain or touch the foot of it. Whoever touches the mountain is to be put to death.

  • Anton Ossa

    POP ALREADY, LET’S GET THIS SHOW ON THE ROAD!

  • Kjell M. Angelsen

    If you owe the bank 50.000 dollars and you cant pay, then you have a problem. If you owe the bank 50 million dollars and you cant pay, then the bank has a problem.

    • socalbeachdude

      Yes, but the borrower of the $50 million also has a huge problem and when it is corporate borrower then there is a very real problem with likely a serious deleterious affect on equities issued by the corporation.

  • Jim Clark

    I should be able to buy a nice repossessed car soon.

  • socalbeachdude

    While $1 trillion of debt in auto loans is a record high number, it is a trivial amount compared to the $12 trillion in mortgage loans in 2007 and the overall amount of $64 trillion of debt in the United States of which around $14 trillion is corporate debt. The corporate debt bubble is of far greater concern and of much greater impact than the auto loan bubble. Student loans are now more than $1.3 trillion and dwarf the auto loan bubble also and unlike auto loans there is NO COLLATERAL AT ALL with student loans and the default rate is a staggering 12% or so currently.

  • socalbeachdude

    The breakdown of the $64 or so trillion of DEBT outstanding is approximately as follows by big picture category:

    30% Federal Government Debt
    20% Total Consumer Debt
    23% Total Corporate Debt
    27% Other debt including Municipalities

    The federal government debt is presently around $19 trillion, Total consumer debt is around $12 trillion which includes about $1 trillion in consumer unsecured credit, $1 trillion in vehicle loans, $1.36 trillion in student loans, and about $8.64 trillion in real estate loans secured by mortgages.

    The total corporate debt is around $14 trillion with a large percentage of that outstanding on corporate bonds which now have average interest rates of around 8.83%. The balance is a mix of all other types of debt outstanding with the largest portion of that $16 trillion being municipal bonds issued by state and local authorities and agencies.

    The US economy is about an $18 trillion a year economy and total assets in the US are around $180 trillion and the percentage of total debt to total assets is only about 35% which is an extremely low ratio from an accounting standpoint and the US is by far the wealthiest single country in the world.

  • socalbeachdude

    Nope. The people in the UK who voted for the stupidity of Brexit DOOMED THE UK AND THEMSELVES and the results started becoming crystal clear on June 24, 2016.

    Now the consequences are getting rapidly much worse.

    Britain cannot easily dismiss Japanese Brexit warning letter

    The Japanese government’s letter setting out its Brexit demands is deeply troubling to the UK since it is clear Japanese companies want Theresa May to negotiate a deal that leaves Britain not just in the EU customs union, and single market, but also retains a free flow of workers between the EU and the UK.

    The British government could not possibly accede to these demands if May’s mantra that Brexit means Brexit is to mean anything. Yet the Japanese requests – set out in a 15-page memo – are likely to become the benchmark by which many countries with strong economic ties to the UK will judge the outcome of the talks.

    Above all, the Japanese memo underlines that the UK is not only negotiating bilaterally with the EU commission and council of ministers, but with many other foreign firms that have invested in the UK, each of which is quite capable of upping sticks in the next phase of their investment cycle.

    http://www.theguardian.com/politics/2016/sep/04/britain-japanese-brexit-letter-eu

    • DigitalThumb

      Umm two replies on here quoting the Guardian newspaper from London.
      Bear in mind that paper was completely biased to BRESTAY and still is. It was spouting Armageddon before the leave vote and has continued afterwards. It is run by leftie lovies that mostly live in London the one of the areas of the UK that voted to stay in the EU, why? Money plain and simple.

      London is almost a country within a country, London benefitted massively from EU membership, house prices in London are horrendously expensive, outside London prices are falling. Coincidently the areas that voted to stay in Europe had the highest house prices in the UK, coincidence? No. Vast areas of Britain have stagnated or declined since 2009, rural locations in particular and the old industrial towns of the north, have been left behind.

      Yes, there will be a price to pay for leaving the EU but to stay would be far worse in the long run. Europe is on the verge of crisis with its idiotic refugee policy never mind the mindless printing of Draghi and co. The EU project will fail.

  • socalbeachdude

    The US government federal debt is now over $19.5 trillion and increasing at more than $1.4 trillion per per and totally dwarfs the comparatively tiny $1 trillion in total outstanding vehicle loans in the US.

    Federal Debt Tops $19,400,000,000,000…

    The federal debt moved above $19,400,000,000,000 for the first time as of the close of business on Tuesday, according to the data released today by the U.S. Treasury.

    At the close of business on Monday, July 18, the total federal debt was $19,391,094,247,028.26, according to the Treasury. By the close of business on Tuesday, July 19, it had risen to $19,402,361,890,929.46.

    On Friday, Oct. 30, 2015, Congress passed the “Bipartisan Budget Act,” which suspended the legal debt limit until March 15, 2017. President Obama signed that bill into law on Monday, Nov. 2, 2015

    At the close of business on Oct. 30, the federal debt stood at $18,152,981,685,747.52.

    In the less than nine months since then, the federal debt has increased by $1,249,380,205,181.94

    Title IX of the Bipartisan Budget Act is entitled “Temporary Extension of Public Debt Limit.” The Congressional Research Service summary explains that part of the law this way: “The public debt limit is suspended through March 15, 2017. On March 16, 2017, the limit is increased to accommodate obligations issued during the suspension period.”

    http://www.cnsnews.com/news/article/terence-p-jeffrey/federal-debt-tops-19400000000000

    UPDATE: US NATIONAL DEBT HITS $19.5 TRILLION…

    http://www.washingtonexaminer.com/national-debt-hits-19.5-trillion/article/2600823

  • socalbeachdude

    Gundlach’s talk of a surprise Fed tightening sets stage for a stock, bond-market rout

    Treasury yields hit highest level since Brexit as stocks tumble

    Don’t blame DoubleLine’s Jeff Gundlach for causing the stock market to tumble the most since the aftermath of the U.K.’s decision to break from the European Union, which roiled global markets in late June.

    The star fixed-income money manager didn’t spark Friday’s rout, but he may have brought investors closer to the precipice by suggesting the Federal Reserve could stun Wall Street by hiking rates unexpectedly, dialing up rates even as fed-fund futures—a measure of rate-hike expectations—have implied that an increase of benchmark interest rates is far from a sure thing.

    “They want to show that they are not guided by the markets,” Gundlach said in an interview with Reuters on Thursday. “The Fed wants to show, at some point, that they can’t be replaced by WIRP (World Interest Rate Probability). The only way they can do that is to tighten when WIRP is below 50,” he said.

    WIRP is Bloomberg’s measure of rate-hike odds. Gundlach told Reuters that when WIRP odds hit 40-45%, the Fed could tighten and surprise the majority of investors placing bets that the U.S. central bank will leave monetary policy unchanged. WIRP levels sits around 32% presently for Sept. and 60% for December, according to traders.

    The policy-setting Federal Open Market Committee holds its two-day confab in less than two weeks on Sept. 20-21.

    http://www.marketwatch.com/story/how-gundlachs-fed-tightening-talk-set-stage-for-a-stock-bond-market-meltdown-2016-09-09

  • socalbeachdude
  • socalbeachdude
  • davidnrobyn

    “The average size of an auto loan is also at a record high. At $29,880, it is now just a shade under $30,000.”
    “…the average monthly auto loan payment is now up to a record 499 dollars.”
    Unbelievable. The AVERAGE borrower is on the hook for 30 grand and makes payments of $500 a month? For a stupid CAR??? We’re seriously brain-dead, folks.

    • socalbeachdude

      Yep. And real cars such as BMW Rolls-Royce Motorcar models start at more than $300,000 for their bottom of the line model, the Ghost.

  • Cheyenne

    Why is it always stated that when a person takes out a loan and falls behind on the payments, they have been taken advantaged of? If you can’t afford it then don’t borrow.

    • socalbeachdude

      100% correct. A loan agreement is a BINDING CONTRACT which clearly specifies the consequences and recourse in the event it is breached by a party.

  • Jessy Scholl

    I have not read through these comments yet, but I can assure everybody one thing. This one thing is that the debt needs to be forgiven. That is what a Biblically sound UN would do.

    • socalbeachdude

      Are you seriously not aware that the flip side of debt is that it is an ASSET to those who hold it and that around $200 trillion in global assets would be destroyed by your nonsensical and stupid assertion of forgiving debt?

      • Jessy Scholl

        I’m not even sure there is $20 trillion in cash. In any case, most of the debt has been created out of thin air and isn’t even viable money.

        • socalbeachdude

          MONEY is not a static thing but rather a DYNAMIC THING THAT CIRCULATES in every economy and cash itself is used in only a small amount of transactions in the US and global economies these days.

          The size of the global economy is now around $72 trillion a year and the the US economy is around $18 trillion a year.

          The total M1 money supply in the US is only $3 trillion and only $1.3 trillion of that is printed currency. This is confirmed by the Federal Reserve H.3 report:

          http://www.federalreserve.gov/releases/h3/current/

          M2 which includes M1 plus savings balances is only around $13. None of the QE funds increased the money supply at all but only served to increase the MONETARY BASE with 100% of those funds remaining inside the Federal Reserve.

          That LITTLE BIT OF MONEY supports the largest economy in the world which is now an $18 trillion a year economy.

          Not a penny of the debt in the US was run up by the Federal Reserve at all.

          No debt is “created out of thin air” at all and is in fact BORROWED DEPOSITS from customers at commercial retail banks in the US banking system plus the funds from the huge $25 trillion SHADOW BANKING SYSTEM in the US outside of the scope of the regulated banking system which includes funds at money market funds, hedge funds, pension funds, insurance companies, etc. which is not taken into account in the form figures of the US money supply.

          MOST MONEY TODAY IS ELECTRONIC MONEY which is the BEST AND MOST DYNAMIC AND FLUID FORM OF MONEY EVER DEVISED.

          • Jessy Scholl

            The US is in debt because of the Federal Reserve. As a result, one day the day will come when we can’t pay back that trillions in debt. I predict that this debt will either be forgiven due to outside forces or the nation will collapse due to all this debt. Eventually, everything needs to be paid back and it will.

            The serious thing here is that Congress is supposed to print the money and it isn’t supposed to cost us a penny. Instead, interest is taken out on every dollar spent. For example, let’s say Congress spends 5 cents interest on every dollar printed. In this example, Congress authorizes the spending of $60 billion on many certain projects including $500 hammers for the Defense department. $12 billion of that cash is already allotted for interest while the rest will be spent. Next Congress authorizes the spending of $4.3 trillion which is on the next spending bill to actually fund the entire government. $860 billion of that cash will go to service the debt.

            Now here comes the shocking secret, every spent penny in the above paragraph comes out to a debt of $5, 232,000,000,000.00. In other words, Congress is borrowing from the federal reserve. I only gave you an idea as to what happens, but I am being kind as to what the interest is all about. The interest rate given to Congress is much different than the interest given to the banks which is just about nothing.

            This clearly leads into the negative interest rates being offered in Japan. Already the interest rate situation is being felt in the United States because bank branches are closing their doors in order to save money, and it isn’t the stuff created out of thin air through credit because we can’t have Visa and Mastercard go under. If it is that bad for banks here, think about what is happening in Japan. Their bond market could collapse and this would lead to massive hyperinflation. The only solution is to forgive all the debt.

          • socalbeachdude

            Absolutely false. The Federal Reserve DOES NOT HAVE ANY DEBT that it owes to anyone, and the US government is the ONE THAT RAN UP THE $19.5 TRILLION IN FEDERAL DEBT BY GROSSLY OVERSPENDING compared to the revenues it has taken in. The US government debt was “only” $1 trillion in 1981 and is now over $19.5 trillion as a result of BORROWING TO PAY FOR ANNUAL DEFICITS rather than raising taxes or cutting government spending.

            As to the profits of the Federal Reserve, you must not be aware that it REBATES 100% OF ITS ANNUAL PROFITS TO THE US TREASURY after paying its member bank shareholders a modest annual 6% dividend.

            The Federal Reserve does not cost the US government and taxpayers a single penny and in fact is the LARGEST SINGLE PAYER OF REVENUES TO THE US GOVERNMENT each year.

            The flip side of DEBT is that it is an ASSET HELD BY ITS OWNERS and the largest holder of US government debt is its own agencies, particularly the Social Security and Medicare Trust Funds. Total government agency ownership of the US government debt is just under $6 trillion in 2016. The Federal Reserve owns about $2.4 trillion of that government debt which is about 12% of the total government debt of $19.5 trillion presently outstanding. That $2.4 trillion owned by the Federal Reserve is ESSENTIALLY INTEREST FREE because the Federal Reserve rebates 100% of its profits each year to the US Treasury after paying its member bank shareholders an annual 6% dividend.

            As to the pricing of bonds – which includes all government debt which is in the form of US Treasuries (bonds, bills, notes, and TIPS) the PRICES ARE INVERSE TO YIELDS (INTEREST RATES) and all yields are SOARING UPWARDS and the current benchmark 10 year US Treasuries closed this week at around 1.72%. The more that bond prices fall the higher the yields rise on those bonds.

          • Jessy Scholl

            The truth is that the Federal Reserve is a predator that is eating the United States alive. The only thing that is keeping us afloat is the fact that we stage endless wars in order to plunder and take over the rest of the world.

          • socalbeachdude

            Absolutely false and extremely stupid assertions. The Federal Reserve is the MOST CONSERVATIVE AN RESPONSIBLE CENTRAL BANK IN THE WORLD and has maintained the US money supply at less than $13 trillion for M2 over the past 10 years.

            The “wars” are JUST A VAST WASTE OF MONEY BY CONGRESS and cause excess spending by the federal government. The biggest part of the problem with federal spending, however, is NOT THE MILITARY BUDGET but rather social welfare programs including Social Security and Medicare which account for more than 63% of all federal spending each year which now amounts to a total of more than $4 trillion.

            The biggest part of the spending is SOCIAL PROGRAMS including the Social Security and Medicare insurance programs which are NOT ACTUARILY SOUND and which are paying out vastly more than they have taken in with payroll taxes.

            A summary of the fiscal 2015 US federal government expenditures totaling nearly $4 trillion is as follows:

            WELFARE & MEDICAL (63%)
            33% Social Security, Unemployment, Labor
            27% Medicare & Health
            ..3% Housing & Community

            MILITARY (20%)
            16% Military
            ..4% Veterans Benefits

            INTEREST ON DEBT (6%)
            ..6% Interest on Debt

            FOOD & TRANSPORTATION (6%)
            ..3% Food & Agriculture
            ..3% Transportation

            EDUCATION & SCIENCE (3%)
            ..2% Education
            ..1% Science

            ENERGY, ENVIRONMENT, & INTERNATIONAL (2%)
            ..1% International Affair
            ..1% Energy & Environment

            OTHER EXPENSES (1%)
            ..1% Government Expenses (general)

            The complete breakdown of Fiscal 2015 expenditures is extensively detailed including actual numbers as well as pie-charts with various percentage breakdowns as to discretionary and non-discretionary expenditures at:

            https://www.nationalpriorities.org/budget-basics/federal-budget-101/spending/

          • Jessy Scholl

            And you are correct to a point. Everything you listed is what the federal government shouldn’t be funding. Yes we need to provide for the defense of this nation, but endless wars aren’t the answer. However, you need to know that we are deeply in debt and everything we are funding created that debt. What you don’t get is that the debt we have is going to come home to roost.

          • socalbeachdude

            The US government federal debt is now over $19.5 trillion and increasing at more than $1.4 trillion per per and totally dwarfs the comparatively tiny $1 trillion in total outstanding vehicle loans in the US.

            Federal Debt Tops $19,400,000,000,000…

            The federal debt moved above $19,400,000,000,000 for the first time as of the close of business on Tuesday, according to the data released today by the U.S. Treasury.

            At the close of business on Monday, July 18, the total federal debt was $19,391,094,247,028.26, according to the Treasury. By the close of business on Tuesday, July 19, it had risen to $19,402,361,890,929.46.

            On Friday, Oct. 30, 2015, Congress passed the “Bipartisan Budget Act,” which suspended the legal debt limit until March 15, 2017. President Obama signed that bill into law on Monday, Nov. 2, 2015

            At the close of business on Oct. 30, the federal debt stood at $18,152,981,685,747.52.

            In the less than nine months since then, the federal debt has increased by $1,249,380,205,181.94

            Title IX of the Bipartisan Budget Act is entitled “Temporary Extension of Public Debt Limit.” The Congressional Research Service summary explains that part of the law this way: “The public debt limit is suspended through March 15, 2017. On March 16, 2017, the limit is increased to accommodate obligations issued during the suspension period.”

            http://www.cnsnews.com/news/article/terence-p-jeffrey/federal-debt-tops-19400000000000

            UPDATE: US NATIONAL DEBT HITS $19.5 TRILLION…

            http://www.washingtonexaminer.com/national-debt-hits-19.5-trillion/article/2600823

  • DB200

    In 2003 I bought a 12 year old car for 7k cash. I still drive it and do most of the maintenance myself. It is now 25 yrs old, in pristine condition and looks better than most cars older than 5 yrs. It is very hard to imagine that people actually lend 30k for a car.

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