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The Subprime Auto Loan Meltdown Is Here

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Debt Loans Auto Loans - Public DomainUh oh – here we go again.  Do you remember the subprime mortgage meltdown during the last financial crisis?  Well, now a similar thing is happening with auto loans.  The auto industry has been doing better than many other areas of the economy in recent years, but this “mini-boom” was fueled in large part by customers with subprime credit.  According to Equifax, an astounding 23.5 percent of all new auto loans were made to subprime borrowers in 2015.  At this point, there is a total of somewhere around $200 billion in subprime auto loans floating around out there, and many of these loans have been “repackaged” and sold to investors.  I know – all of this sounds a little too close for comfort to what happened with subprime mortgages the last time around.  We never seem to learn from our mistakes, and a lot of investors are going to end up paying the price.

Everything would be fine if the number of subprime borrowers not making their payments was extremely low.  And that was true for a while, but now delinquency rates and default rates are rising to levels that we haven’t seen since the last recession.  The following comes from Time Magazine

People, especially those with shaky credit, are having a tougher time than usual making their car payments.

According to Bloomberg, almost 5% of subprime car loans that were bundled into securities and sold to investors are delinquent, and the default rate is even higher than that. (Depending on who’s counting, delinquency is up to three or four months behind in payments; default is what happens after that). At just over 12% in January, the default rate jumped one entire percentage point in just a month. Both delinquency and default rates are now the highest they’ve been since 2010, when the ripple effects of the recession still weighed heavily on many Americans’ finances.

The chart below was posted by David Stockman, and it shows how the delinquency rate for subprime borrowers has hit the highest level since 2009.  In fact, we are not too far away from totally smashing through the previous highs that were set during the last crisis…

Subprime Auto Loans

It is quite foolish to try to sell expensive cars to people with bad credit.  This is especially true now that the economy is slowing down significantly in many areas.  But people are greedy and they are going to do what they are going to do.

The most disturbing thing to me is that many of these loans are being “repackaged” and sold off to investors as “solid investments”.  The following description of what has been happening comes from Wolf Richter

The business of “repackaging” these loans, including subprime and deep-subprime loans, into asset backed securities has also been booming. These ABS are structured with different tranches, so that the highest tranches – the last ones to absorb any losses – can be stamped with high credit ratings and offloaded to bond mutual funds designed for retail investors.

Deep-subprime borrowers are high-risk. Typically they have credit scores below 550. To make it worth everyone’s while, they get stuffed into loans often with interest rates above 20%. To make payments even remotely possible at these rates, terms are often stretched to 84 months. Borrowers are typically upside down in their vehicle: the negative equity of their trade-in, along with title, taxes, and license fees, and a hefty dealer profit are rolled into the loan. When the lender repossesses the vehicle, losses add up in a hurry.

It almost makes you want to tear your hair out.

This is exactly the kind of thing that caused so much chaos with subprime mortgages.

When will we ever learn?

Meanwhile, we continue to get even more numbers that indicate that a substantial economic slowdown has already begun

We just got the clearest sign yet that something is wrong with the US economy.

Markit Economics’ monthly flash services purchasing manager’s index, a preliminary reading on the sector, fell into contraction for the first time in over two years.

The tentative February index was reported Wednesday at 49.8.

Statistic after statistic is telling us that a new recession is already here.  And of course some would argue that the last recession never actually ended.  According to John Williams of shadowstats.com, the U.S. economy has continually been in contraction mode since 2005.

If we do not learn from history, we are doomed to repeat it.  All over the world, “non-performing loans” are starting to become a major problem, and already some financial institutions are starting to get tighter with credit.

As credit conditions tighten up, this is going to cause economic activity to slow down even more.  And as economic activity slows down, it is going to become even harder for ordinary people to make their debt payments.

Deflationary forces are on the rise, and most global central banks are just about out of ammunition at this point.

Everyone knew that the global debt bubble could not keep expanding much faster than the overall rate of economic growth forever.

It was only a matter of time until the bubble burst.

Now we can see signs of crisis popping up all around us, and things are only going to get worse in the months ahead…

  • Rhino Horns

    MOAR!!! This time is different, promise!!

    • pulltheweeds

      lol

  • Cambridge101

    The price of new cars is out of control. I have not bought a new car for years. A new car can lose 15% of its “value” the second you leave the dealer’s lot, but that fat loan you just signed for won’t go down.

    • CASTIEL

      Thats why i keep my bmw 318is from 1994 and my el camino from 1971…..they keep running….new cars are garbage….

      • Cambridge101

        Amen.

      • Understanding 18

        So true. Plus those new cars got all of that tracking crap built into them so they can continue to spy on people even when they’re in their cars. I’m doing just fine with my 2004 Ford Taurus that I bought brand new almost 12 years ago. It gets me from Point A to point B.

      • jonodough

        New cars are good. Just overpriced.ive had mine since 08 and plan to keep it as long as I can.

    • SunnyFlaSnotress

      Obviously a government plot. We could have cheap little Chinese and Indian cars if we weren’t protecting the auto makers in the USA.

      • tinfoilhatttt

        We could have cheap and good AMERICAN cars if not for all the govt-mandated bullschitt features to keep us safe/keep us monitored/make the air ever cleaner…tire pressure monitors for God’s sake…

        • Bill G Wilminton NC

          YUP but the traitors are in charge…VOTE TRUMP

      • Bill G Wilminton NC

        Well said and diesel engine cars also. Like The Diesel Cooper for sale in England it gets 80 mpg……we could do the same in the USA !

    • Steeve Girard

      Unfortunately true.

  • GSOB

    Printing money caused the spike in the pricing of cars.
    When you have the advantage over the rest of the world
    by the petrodollar arrangement, you can never run out of ink.

    • aldownunder

      What verse of the bible is that from
      Oh sorry an actual comment. Well said.

      • GSOB

        Ezekiel 28:3-7

    • Edcs10

      If people understood the petrodollar, it would change everything… Their view of foreign policy, their decisions, their VOTES!

    • Zenithon

      Yes! The exact same reason why a college education cost so much more today. The federal government creates a student loan program, which they idiotically think is going to help kids get ahead in life. They make is so that it is impossible to default on that debt. Then package and sell it to young folks right out of high school, who have no clue about how hard it is going to be to pay this money back, so they go out and get themselves all jacked up with debt. All that money pours into the college system and guess what happens? The price of education goes up and up and up.

      • Dave

        Your first mistake was believing that the govt did something for someone’s benefit….
        They need debt slaves, so they come up with ways for non-slaves to become slaves.
        Wake up…NOTHING they do is to help ANYONE. It is to enrich themselves (control) at your expense.

        • Horiboyable .

          Government are all about their power, their jobs, their pensions and the favours they can sell.

        • Bill G Wilminton NC

          YUP VOTE TRUMP

      • jonodough

        And just like Obamacare, that is the goal. To bring America to full fledged socialism.

      • GSOB

        You are recognizing a segment of our society.
        I often ask myself why student loans can’t be discharged in a bankruptcy.
        You’d have to be a pretty good lobbyist to set that one up.

    • Rob W

      I was watching a movie about a newspaper and I got a kick out of a line that I think applies here equally… “Never pick a fight with someone who buys ink by the barrel.”

    • Mark

      I agree 100% on this one.

    • Steeve Girard

      But you can run out of cheap oil.

  • GSOB

    “In order for capitalism to work, in order for it to produce a good and stable society, traditional Christian virtues are essential”

    – Antonin Scalia

    • Malcolm Reynolds

      You also have to let people fail and the stupid and lazy suffer under the weight of their own decisions.

      • ALWAYSTOMORROW

        I finally agree with something you said 100%.

        Now say something hatefull to me so I can go back to disliking you. 10, 9, 8, 7, 6, oh wait, no more countdowns.

        • JustBill

          Nice logo. Your logo also looks like a pressure valve, does it start to spin or rattle when you think about resuming THE countdown?

          • Mike

            He likes the attention.

          • SunnyFlaSnotress

            oh yeah.. Always, would you post a link for me to see about the band?

          • ALWAYSTOMORROW

            https://twitter. (dot com) /alwaystomorrow3

          • SunnyFlaSnotress

            oh, ok.. thanks :)

        • K2

          Michael said this year will be catacalysmic year. So start a countdown for a catacalysm.

          • SunnyFlaSnotress

            309 Days left for the Cataclysm to occur! Let’s count the days!

          • Steeve Girard

            No need to count! For everyday since Nixon said paper money is not redeemable in gold, is a disaster!
            .
            Buying is different from redeeming

          • WhySoSerious?

            I will start that countdown next year!

        • Malcolm Reynolds

          Don’t insist on saying stupid things over and over and over and nobody will be hateful to you.

      • retired22

        The problem is that most of these bums who get caught in the grinder are hustlers,speculators,& get rich quick day traders.I don’t care if these jerks get hit hard,they don’t deserve better.

        They are like some fools who go to Las Vegas with a pocket full of cash with the intention of making big money beating the casinos!

        In fact they are worse,..the fools that gets burnt in Las Vegas are usually doing so with their own money.
        The Wall Street hustlers get easy money from the banking system to play with & that money eventually comes from the taxpayers.

      • Steeve Girard

        That I agree!

      • David Mowers

        Like we let Goldman Sachs fail?

    • afchief

      So true!

      • GSOB

        We’ll get a new body too.

    • REALIST

      So, THAT is why they killed him.

      • SunnyFlaSnotress

        Scalia died a natural death.. but my latterday semi-fatalism tells me yes, there is more to this… God obviously is tired of rightwingers,and called this sheep back to his heavenly fold before he made another rightwing decision.

        • Bill G Wilminton NC

          You and Rob W get ready because Friday is BUBBLE NITE at the BATHHOUSE…. bubble up is added the bathwater wheehoo

          • SunnyFlaSnotress

            I’m a female, Pill. Neither Rob nor I are interested in meeting you at your favorite “happy” bathhouse.

          • Bill G Wilminton NC

            Not a Bath House type of guy…. I guess I never got enough ANXIETY to ” make the grade ” ha ha what a joke !

          • Steeve Girard

            Ok, now I know who to not invite to my Sweat Lodge.

          • Bill G Wilminton NC

            Gay Veteran is looking for a “bubble buddy ” for happy hour at THEIR BATH HOUSE……

          • Gay Veteran

            you’re the expert, Bathhouse Bill

          • Bill G Wilminton NC

            Remember You and Rob W no dunking for apples in the tub !…..

          • Gay Veteran

            oh Bathhouse Bill, you were dunking for more than just apples

          • awb22

            again

        • Ricardo

          a pillowcase over your face is a natural death …… yeah right !

          • SunnyFlaSnotress

            It was a sensationalist play on words by msm made to spawn conspiracy theorists.. the pillow was over his head meaning to say it was above his head between it and the headboard… You read too much Michael and not enough real world news.

          • WhySoSerious?

            Obviously you never consider what happens behind the scenes! Scalia was going to expose Obama for a deal he was going to propose that would eliminate all the SCJ and senators and legislators that were against him! Obama was to make a call on his phone that would report to a nuclear sub that nuke Washington while Obama was just about to leave Washington! Only Scalia knew about this and he paid for it!

          • L. A. McDonough

            Some people hold on to pillows while sleeping so maybe the pillow landed on top when he rolled into a new position. some folks sleep weird.

        • Steeve Girard

          Ladies and Lords!!!!(Pagan swearing) Both of you! He was old enough to die without intervention… Repeat the sentence Morgan Freeman said to Ben Affleck: “You do not know!”

          • SunnyFlaSnotress

            Yes, he was.. and the first thing I guessed was heart attack, but.. my deeper senses, all prejudices aside, do tell me there was a symbolic reality to the timing.

        • Bill G Wilminton NC

          There was a group at that ranch that has origins that go back almost 300 years……Scalia was there with that group supposedly as a guest. If I had better research tentacles I would be all over that secret group…..they appear harmless by calling themselves a hunting club.

    • Steeve Girard

      Nope… for Capitalism to work, it must have a goal so strong, that it represents the absolute enemy to destroy.

    • Gay Veteran

      the reactionary Scalia who voted for corporations to be able to spend UNlimited amounts on campaigns

  • Mondobeyondo

    Once again, history repeating itself.

    Subprime lending failed big time with real estate. We learned that in 2008. Well, guess what? Let’s try the same thing with VEHICLES this time! I’ll bet you a dollar to a doughnut that the end result will be the same. They’re doing the same thing over and over, and expecting a different result. It’s insane, I tell ya! INSANE!!

    And by the way, didn’t we also try some other loony vehicle-related venture back in ’08? Remember “Cash for Clunkers”? How did that work out?

    We are on the brink of a deflationary depression, and it won’t take very much to push us over the edge. “Soup kitchens and bread lines, as far as the eye can see… so tonight we’re gonna party like it’s 1933″…

    • K2

      You are sounding like michael lol.

      • Bill G Wilminton NC

        The truth is what is………..

        • K2

          we’ll see.

    • danbax

      there’s already lines and soup kitchens… it’s just somewhat hidden..
      ebt cards 47 million people
      long lines at food banks who say they don’t always have enough
      and more and more homeless living on city streets

    • Bill G Wilminton NC

      YUP its coming vote for trump and lets give ourselves a chance…………..

    • Steeve Girard

      It will be worst than that when the energy crunch happens. See you in 2030.

  • Mark A. Kuntz

    The only brand new car I have ever bought in my entire life, (I’m 55), was when it was easier to buy than a used car. It took more money up front out of my pocket, that I did not have, to buy a used car. So I bought a brand new car because it required no down payment at all. How many people are in that situation and do what I did, and then find out later you cannot afford the payments, for a myriad of different reasons?
    In my case I was able to sell my house at a huge profit, (yup, the real estate bubble), and pay of my car. I used the profit to pay off bills and to buy another house, at an inflated price. When the bubble burst I lost my entire equity of $40,000. After that we decided to get off the merry go round called credit and only live within our means. If we cannot afford it unless we borrow, we don’t need it. We owe nothing and drive a 98 vehicle with 180,000 miles on it. Haven’t you heard, freedom isn’t free?

    • Jerry C

      “Debtor is slave to the lender.” Yep, live within your means = freedom. Pretty simple really.

  • GSOB

    You can get a decent car, if not new, for less than 15G

  • mtntrek3

    I like our 2000 Dakota and our “94 F-150. We also added a ’97 Camry for our son lately that we found for 800 cash. We like them……… they’re paid for and get us from point A to B. Did I mention they’re paid for? Ha.

    • Guest

      Camrys are awesome! My 2004 Camry has over 182k miles on it. I’ve had it for 8 years now, and I plan to have it for many more.

      • mtntrek3

        My wife had a Celica for several years before we were married. Good car. She never had any major problems w/it.

    • Bill G Wilminton NC

      Chris I drive a diesel wagon 85…….and have never bought a car on time in 50 years and have never had collision insurance only liability.

      • GSOB

        excellent

      • mtntrek3

        I bought a new car once when in the service back in ’88…….. an Olds Cutlass Calais. Last time I’ll do that. One loses too much money that way due to depreciation. I like our vehicles that are paid off. A good vehicle is one that’s paid for. :-)

      • mtntrek3

        The only good vehicle is one that’s paid for. Kind of like all the deer we have around here in S. Il. ……….. the only good ones are the ones on the dinner plate, the rest of them are a nuisance. Ha.

        • Bill G Wilminton NC

          Do you hunt with a climbing treestand………..?

          • mtntrek3

            Hey Bill………. no, I hunt deer w/ the truck. The ’00 Dakota we have I call the deer buggy. Nine deer the past 10 years. Ha. Actually, we get venison from my wife’s brother. He hunts deer from a stand. I used to hunt quail and rabbit a lot until my knees wore out a few years ago. I still fish sometimes. When I was stationed in Tucson, Az. years ago I had a good time quail hunting in the Tortilla Mtn. range north of town. Lot of Gambel quail there. Quail every night for supper. :-) Not so many quail or rabbit around here in S. Il. (Bluford area) like there used to be. Loss of habitat among other things.

          • Bill G Wilminton NC

            Wow some areas you have hunted in ….marines or army….what make stand your brother in law uses ?

          • mtntrek3

            Air Force….. nine and a half years. Welder. Somewhat of a machinist. Wife’s brother’s deer stand type I’m not sure of. He had a stroke last year and he hasn’t hunted or worked since then. We’re concerned about him. He’s improving some thankfully.

  • smooze

    The past couple of weeks I’ve noticed several banks and CUs have quite a few repos sitting in their parking lots. Not just cars/trucks either, couple of boats, 4-wheelers etc.

  • ali

    Adhering to my principles of never buying anything on loan, the only car I bought was on 100% cash and finally i have saved up enough to buy a small piece of land for my future home and god willingly in due time I will again save up enough to build my home on it. I am not living a luxurious life but I am living a debt free life and I am living it well without the help of Banks.

    • Guest

      You’re very wise.

    • Mark

      I agree and you are very wise.

    • Ricardo

      That is a good plan. I have had no debt since 2004.

      The Bible says that God’s people should be the head and not the tail and put another way Proverbs 22:7 says : The rich rule over the poor,
      and the borrower is slave to the lender.

    • Steeve Girard

      Same here… I live with my means.

  • Edcs10

    It’s not just cars… It’s boats, rec vehicles, etc. The amount of people I now know who own boats is crazy…and then they’re paying to moor them and off season store them.

    • Nosuchthingasrightorwrong

      BOAT = Break Out Another Thousand

  • Scott

    I’m one of the stupid people in this predictament. I have a 2011 black Hyundia sonata. I paid 3k up front for it in May of 2015. My monthly nut is $385.05! My credit was shot, below 550 (I was young and dumb and burned 10k on a previous failed business and used credit but I learned, or so I thought I did) My insurance is $273.00 a month! Add another $150 for gas a month at bare minimum. So I’m spending roughly $800 a month on transportation alone. This is insane. At the time I really needed the car for work, but now business has slowed and I’m starting to realize I have 51 more payments for a car that isn’t worth it. I’m thinking a strategic default here is the best case scenario. Can anyone help provide me with some insight on how to best handle this situation, it would be a great help, thanks.

    • Mark A. Kuntz

      Well, first of all, your not stupid, regardless of what others may say. As long as we learn from our mistakes, its all good and believe me, everyone makes mistakes. Sometimes we are just not aware that the deal isn’t really a deal. We all have done it.
      The way I see it you only have a few options. One is just to let the bank have the car back and quit making payments. I had to do that once because I simply could not make the payments any longer. Sure, it won’t help your future credit but try to look at this way. Ask yourself a question. How long can I keep up these payments, putting more money into a car that I may end up losing anyway? So one option is to quit making the payments and start saving for a used car now. Once you call them they won’t come and get the car for awhile, waiting to see if you really quit the payments. Of course they may threaten you with collections, but believe me, they really have no power to do anything. So they threaten.
      Another thing you can do is to go to an agency that helps you set up a payment schedule for all your current bills. They will help you structure the bills in an honest manageable way and in the process get people off of your back and give you some breathing room while you do your best to pay off debt. I went to a “credit counseling company” that was free or inexpensive. Don’t quite remember but they did help me, that’s for sure.

      • Bill G Wilminton NC

        You are a Blessing for this fellow.

        God Bless You and Your family

        Shalom

    • Ann Tenna

      sorry BuBu, default is STEALING.. “BUT”!!!!!! in your case i would go Bankrupt,/default and not feel guilty.. the banksters ran a SCAM on you! so did the car company!

      • Rob W

        No, defaulting is not stealing. The provisions for default are written into the contract. The banksters are happy to keep you confused, however.

        • Bill G Wilminton NC

          Maybe you do have some brains….

      • aldownunder

        Bull**** interest + insurance rates is stealing

        • Bill G Wilminton NC

          wrong as he was scammed by the corrupt system……….

    • SunnyFlaSnotress

      Get a 3rd job like everyone else.. (kidding)

      • Steeve Girard

        Nope… I will not die at 60 of overstraining myself. Balance is the key to a good life. Learning to say no and let the kid cry in his corner is the best policy.

    • ALWAYSTOMORROW

      If you prep you have ammunition. Use it.

  • Harry Merkin

    I fell for a deal. I owe 22k. Purdy tho’. Hope I don’t lose it. 2009 Dodge Challenger done up like the General Lee. My brain wasn’t thinking. My inner child was. However it’s my only bill. House and land is paid off.

    • Jerry C

      “You ain’t no man unless you own some land.”-Oh Brother Where Art Thou?

      Priceless. Still working on becoming a man (…owning some land; i.e without a HOA to boot!).

    • Steeve Girard

      Your house and land can be seized… never think when you own something, that you totally own it to yourself. Even after you paid for them, you still pay for taxes. Which means each period you still owe some value on what you supposedly own. And also check with your solicitor or notary, the document called the deed may not be even in your name, but to the name of the bank with a lease to you. You have to pay there also to change that document.

    • ALWAYSTOMORROW

      RT or SRT?

  • billtheguy

    84 months on a car loan is suicidal. At the end, the car isn’t worth anything. To get the payment down, or lower the number of payments, obviously you need a large down payment. When you save up 15K, a used car looks pretty good. Never owned a new car, I’m not that vain!

  • Bob Johansen

    Remember “cash for clunkers?” That was LOL.

  • A Dodgy Bloke

    84 months term for a car loan?

  • Horiboyable .

    I am from the UK. I would never buy a new car even if I was a millionaire because as soon as you drive it off the lot, 2 to 3K has just been lost, I would rather take the family on a holiday. In the UK no body wants to buy V8’s so I have always brought 7 series BMW’s that are about 8 years old with low miles. Brand new they are about £90,000 and I pick them up 8 years later for about 3 to 4K. Most are owned by business men whom never use it for family use so they are normally very mint. You get a great ride and all that technology for pennies. I work it out that capital costs are about £1000 a year.

    • stanley zip 30666

      Smart Limey!!!… I do the same here in this formerly great republic known as amerika.. only i like FORDS 4cylinders.. currently 1997 ford Aspire 275k miles on it and still going strong mazda 1.8 engine

    • Rob W

      I like the diesel Mercedes nobody wants here in the states… solid as a brick, and as comfortable as the living room sofa.

      • Nosuchthingasrightorwrong

        2.5 yrs ago I bought an ’02 E430 4Matic in mint condition w/100k miles for $5k it runs like a tank. Starts up everytime and if I decide to sell it (which I won’t) I can get pretty much all my money back. I’m done leasing buying new cars and bringing them to the stealership.

  • fwalker000

    If financing transportation is an issue then obviously you don’t belong speculating in capital markets.

  • jakartaman

    Once survival of the fittest is removed with government socialism – the rot begins

    • df NJ

      Maybe it’s time to close some of our 800+ foreign military bases we have in every country in the World?

  • REALIST

    New car dealers don’t make their money from the new car. They make it from your trade-in and finance. A good salesman can bring in $3,000 on the trade-in deal and a good finance guy can bring in $2,500.

    • df NJ

      They did not make any money on my last trade-in!

    • Nosuchthingasrightorwrong

      Dealers really make their money on the service end of the business. You’re spot on about the trade in making them most of the money. Best time to negotiate with them is at month end as most dealers have to finance their floor plan from a bank and desperately want to avoid the interest payment. I’ve robbed many a car from stealerships this way.

  • Mark

    I have a 2001 Honda Accord which is in great shape. I have kept up with maintenance and did some improvements but most important the car was paid off in a couple of years. I normally buy demos because they have around 2000/3000 miles on them. They will give you the new car benefits but at huge discount. I bought an 2013 ACURA TL two and half years ago fully equipped with the full luxury & electronics package. This car was a demo with 2500 miles and was brand new. I also got the simonize treatment for the leather and dash protection along with paint protection which I will never have to wax the car again for life. I received .01% financing and paid it off in 18 months. I just bought a 2015 ford Edge truck 25,000 miles in great shape for a fraction of the cost. Paid cash. No car payments.

    • Creepy Pedro

      I drive a 2013 Edge Sport……love it. Paid cash for it in 2014 with a cpov. Edge’s are really nice.

      • Mark

        Yes, I love the Edge because they drive like a truck and have that crossover feel still. Good choice.

  • RedSky

    I have noticed the used car lots filling up again with beautiful newer used vehicles, high end with all the bells and whistles. Either they traded for a newer one or they defaulted on their loans, most likely the latter. I prefer the base models myself with manual transmission. I have a beer budget and I am not deluding myself.

    • ALWAYSTOMORROW

      RedSky you said “I have noticed the used car lots filling up again with beautiful newer used vehicles…”

      Here is what I have noticed….people notice what they look for.

      Many here search the internet for bad news and bad numbers on the economy, stores closing, unemployment numbers, baltic dry index numbers etc. Yes there are plenty to be found.

      On the other hand look for some good things.

      I get told all the time by people here how I have no brain, how nearsighted I am etc. etc.

      Funny thing my life and finances seem to be in good order compared to the sad stories I read here.
      Hmmmmm? Interesting. 😉

      Keep looking at how bad things are. It seems to make most here happy, and by happy i mead miserable.

      • TL2

        By your statement, “on the other hand look for some good things”, it leads me to believe you have not blinded yourself to the stuff that is going on, it’s just that you are choosing to not dwell on it. By saying you are “doing well in life and finances” in light of your comment leads me to think you have, more often than not, been wise with your choices. Am I understanding your meaning correctly?

        If you have indeed learned to make wise choices, that is great and I am happy for you. I personally chose to learn via the school of hard knocks. What can I say, I am a slow learner. However, like me, many others have yet to learn or are in the process of learning, the lessons you obviously have learned in order to make wise choices. I am sure you have much wise and compassionate advise (ok, let’s face it, some people need to be allowed to fall, but we love them enough to be there to lovingly help them pick up the pieces when they have finally fallen hard enough and are ready to learn, right?) for people who are going through hard times.

        I agree with you, dwelling on the negative does take its toll. It takes up too much emotional energy, thus leaving the tanks empty. Looking on the bright side of life, ESPECIALLY when times are tough, can determine how long a person stays down.

  • Priszilla

    There were a number of issues from last crisis that were not addressed in the “recovery”.
    Low wages and salaries.
    If wages are too low and you can’t save, you have to borrow. And then when you lose the job or your expenses go up you can’t service the debt.

    Investment / Consumption
    You invest to save costs. Buying an expensive car – with a loan or cash – is not investment. It’s consumption. So people add consumption to their costs. Losing money in the process.

    Renewable resources, Sustainable economy
    The oil boom wasn’t sustainable as we can see. Renewable resources might have not have had a steep growth, but might have probably been sustainable. Small steps again and again and again and again. People reducint their running costs, getting surplus money for more investments for more savings.

    • Steeve Girard

      Renewable energies will not work until we have burn out all easier energy products. Oil, Coal, Natural gaz. People hate complicated processes.

      • Priszilla

        It’s much easier to condemn the government for not helping you than to get your behind up and close the holes in your house.

        Instead of finding more and new ways to make electricity it is much easier to only use what you need and not to waste what you already paid for.

        In Winter have a look at the roofs around you. On some houses there is no snow left and on some houses the snow stays for a long time.

        On the road there are people who have their foot on the accelerator until 50 meters before the stop, and then they hit the brake hard. If the traffic light is red ahead, take off the foot from the gas pedal. If you are lucky you don’t need to stop at all but can use the momentum to start through.

  • Alleged Comment

    Lieberals say even the poor can own a house and NOW A CAR.

    There is a reason why for years and years one did not make loans to these groups and why they were considered HIGH RISK.

    Lieberalism is what is getting us in this mess and it is being done on purpose.

    • Rob W

      Yeah, all those liberal bank officers, okaying the loans…

      LOL

    • Bill G Wilminton NC

      If a person does not have God in their life it leaves a VOID… this person will sometimes use drugs, sex etc etc to fill this VOID…. SOME people fill this VOID with GOVERNMENT and make GOVERNMENT their GOD !…..this is what makes a LIBERAL !.

      A LIBERAL HAS GOVERNMENT AS THEIR GOD !

      • Gay Veteran

        the only void here is the one between your ears

        • awb22

          projecting

    • Gay Veteran

      all those banksters aren’t liberals

  • CharlesH

    I’m of the mind set that we never really got out from under the Great Recession – we’ve been bumping along the bottom. Our next stop – the Greater Depression.

    • Bill G Wilminton NC

      YUP………………….

  • Arizona

    HOW much will a hundred dollar bill,or an once of Gold be worth when theres NO FOOD,…ZERO,they’ll ask you what you got to trade maybe,BUT money,hahaha,they’ll just laugh in your face,more then likely AMMO will be the new money,and you better have a lot of it,THERE will be probably more then one group looking to take everything you have,including your female children,BUT hey keep worring about your money,and we’ll see how it turns out…….GET CLOSE TO THE LORD,your going to need HIS protection……….

  • Steeve Girard

    Not yet! Banks can still extract money from the energy sector to kick the can further… It will not collapse until 2030 with the fall of conventional oil.

  • Steeve Girard

    The military do not care about the politicians and corporations. They try at every corner to make their life more miserable when they can, only the high command cares about them for power reasons.

  • Barry Goldwater

    It’s not only people with bad credit but it’s also people with very small salaries walking out with the keys to brand new automobiles. Just like the housing market meltdown most of these people will never survive the payment schedule on these vehicles and there’s the rub.
    I can understand any person’s desire to own a flashy new car with all the bells and whistles however many are left with only half sometimes less than half a monthly income on which to live , it doesn’t bode well for them or the economy when these loans go belly up.

    • Nosuchthingasrightorwrong

      I agree. Auto salesmen prey on low info consumers by asking how much monthly payment they can afford, then proceed to increase to the loan term to as high as 84 months to make the monthly but work. Let’s not talk about the money factor and how they use that to rip consumers off.

  • df NJ

    One day Jesus was talking to one of his disciples about a battle that goes on inside of people. He said, “My friend, the battle is between two ‘wolves’ inside us all.

    One wolf is evil. It is anger, envy, jealousy, sorrow, regret, greed, arrogance, self-pity, guilt, resentment, inferiority, lies, false pride, superiority, and ego.

    The other wolf is good. It is joy, peace, love, hope, serenity, humility, kindness, benevolence, empathy, generosity, truth, compassion, and faith.”

    The disciple thought about it for a minute and then asked Jesus, “Which wolf wins?”

    Jesus replied, “The one you feed.”

    • Steeve Girard

      Errrr… I do not think Jesus was the orignal speaker of this tale… It was Native Americans.

      When the last tree will falls and the last fish it taken, you will know then, that you cannot eat money.

    • mtntrek3

      Not Jesus….. but I think this story came from one our Native Indian tribes. Good story.

    • Bill G Wilminton NC

      Absolutely not Yeshua and this tale was used on this site only 2 months ago……

      • carson

        not a verse/parable Jesus spoke but has a valid point. romans 8 and walk in the Spirit and not the flesh, feed the Spirit and don’t feed the flesh.

        • Bill G Wilminton NC

          well said……..thanks

    • Chris

      I Love this story.

  • Mark Caldwell

    This is the trigger event.

  • Steeve Girard

    The cure for this bullcrap, is to raise the rates… punish those who do not know what borrowing means!

    But sadly, it will punish those who knows and they must pay for the incompetence of others, as usual.

  • Chris

    Wait a second! I thought the derivatives were going to get us last year. I am still waiting for that one to get us.

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  • Scott

    Yeah I live in Brooklyn NY, where insurance rates are beyond stupid.

  • GSOB

    There’s a man in me
    He’s cold and he’s hard
    He’s got an eye for deception
    He’s always on guard
    He’s swimming in concrete
    And drowning in fear
    And he keeps it all locked in his heart

    This man is a tyrant, a fault findin’ hack
    You can’t tell him nothing
    There’s no turnin’ back
    He leaves blood on the highway and scattered debris
    He crawls from the wreckage but he still doesn’t see
    He’s alive
    The man is jive

    There’s a man in the mirror
    I don’t like his looks
    His teeth they are crooked
    His hands are like hooks
    He speaks 4 letter language
    ‘Cause his mind is so small
    His voice is like venom
    I don’t like him at all
    God, I gotta get away from the man in me

    She says
    Now what are you afraid of?
    There’s no need to judge
    You know I can help you
    But you won’t even budge
    Pretty flowers surround you but all you can smell is a rat
    She says
    Now why you insist on your head in the sand
    Building walls all around you, you don’t understand
    That these ways are outmoded, but all you can change is your hat
    The man in me don’t wanna know nothing about that

    There’s a man in the closet
    He wants to come out
    He wants to be noticed
    But he’s so full of doubt
    He wants to be well known and famous
    But he’s so filled with pride
    The keys to his fortune stay locked up inside
    Can it be the man in me?

    She says
    Now what are you afraid of?
    There’s nothing to fear
    You want me to help
    But you won’t let me near
    In your heart you can hear me
    But all you believe are your eyes
    Tell me why you’re convinced
    That a fist in your face is all you deserve
    From love you’ve misplaced
    The truth is salvation
    But all you believe in are lies
    The man in me wants to believe, but he won’t even try

    There’s man in me, and he’s so full of hate
    He’s so misdirected
    He thinks it’s too late
    He pours salt on the wounds
    Only Time wants to heal
    He’s dyin’ inside
    And he don’t wanna feel
    Anything
    The man is strange

    Man

    – Rodney Crowell

    • GSOB

      But off the old and put on the new. Thank You Jesus for you are my hope, strength and refuge.

      • GSOB

        Rock of Ages, cleft for me,
        Let me hide myself in Thee;
        Let the water and the blood,
        From Thy wounded side which flowed,
        Be of sin the double cure,
        Save from wrath and make me pure.

        Not the labor of my hands
        Can fulfill Thy law’s demands;
        Could my zeal no respite know,
        Could my tears forever flow,
        All for sin could not atone;
        Thou must save, and Thou alone.

        Nothing in my hand I bring,
        Simply to Thy cross I cling;
        Naked, come to Thee for dress;
        Helpless, look to Thee for grace;
        Foul, I to the fountain fly;
        Wash me, Savior, or I die.

        While I draw this fleeting breath,
        When my eyes shall close in death,
        When I rise to worlds unknown,
        And behold Thee on Thy throne,
        Rock of Ages, cleft for me,
        Let me hide myself in Thee.

  • larrythelogger

    In a year or so, I’ll be able to buy a late model, low mileage pickup for dimes on the dollar. Get out of debt, save some cash and you will too because very few people will be able to afford even crappy used cars. At least something good will come out of our having to bail out the banks holding the ABS debt. I love the new name too; Asset Backed Securities as if the value of a car never goes down with age. Note to self; go long auto repossession companies

    I do have a great name for the bill the fidiots in Congress will pass to make you and I bail out the auto loan debt. The “Don’t Let White Christians Crush Puppy Skulls Like They Always Do Act.” No doubt McConnel will team with Reid to draft it.

    It’ll be much more fun bailing out college loan debt what with people getting degrees in the ever marketable women and gender studies, gay and lesbian studies; you know degrees employers other than the government and colleges REALLY want.

  • http://www.ititle.org/ Joseph Davis

    Hi… This blog sounds great. Overall is excellent. I love this. But need to improve to explain in deep and listing the factors specifically. But still it’s awesome and knowledgeable. Nice work. The price of new cars is out of control. I have not bought a new car
    for years. A new car can lose 15% of its “value” the second you leave
    the dealer’s lot, but that fat loan you just signed for won’t go down.

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