JoeBama Economics: Keep pumping out hot money and raising interest rates to keep inflation in check.

Jimmy Carter did it too.

BRILLIANT!

That’s OK, they’ll all just buy EVs.

That means, that for some of us more responsible consumers, prices of pre-owned cars will decrease.

The White House’s Official Big Mouth has threatened banks that they better help illegal aliens purchase new vehicles. The lines at the EV chargers are about to become a lot longer. Eight million new illegals since the Demented One rose to power.

People need to start buying things with cash and not credit. Yes in my 20’s I did the stupid credit cycle but by 30 you should be over that and pay cash for everything except house. Cars should be paid in cash. I purposely got a 2011 Toyota for 20,650 to pay cash. I knew they last and wanted it for a long time. 12. Years later going strong. I don’t need flashy. People paying 50,000 for a car on credit are insane.

Presidents can’t raise interest rates directly. The FED has no choice but to raise when the govt over-borrows and over-spends.

Great Financial Crisis

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https://en.wikipedia.org/wiki/2007%E2%80%932008_financial_crisis

Here referred to as Global Financial Crisis.

The 2007–2008 financial crisis, or Global Financial Crisis (GFC), was the most severe worldwide economic crisis since the Great Depression of 1929. Predatory lending targeting low-income homebuyers,[1] excessive risk-taking by global financial institutions,[2] and the bursting of the United States housing bubble culminated in a “perfect storm”.

Mortgage-backed securities (MBS) tied to American real estate, as well as a vast web of derivatives linked to those MBS, collapsed in value. Financial institutions worldwide suffered severe damage,[3] reaching a climax with the bankruptcy of Lehman Brothers on September 15, 2008, and a subsequent international banking crisis.[4]

The preconditioning for the financial crisis was complex and multi-causal.[5][6][7] Almost two decades prior, the U.S. Congress had passed legislation encouraging financing for affordable housing.[8] However, in 1999, parts of the Glass-Steagall legislation, which had been adopted in 1933, were repealed, permitting financial institutions to commingle their commercial (risk-averse) and proprietary trading (risk-taking) operations.[9] Arguably the largest contributor to the conditions necessary for financial collapse was the rapid development in predatory financial products which targeted low-income, low-information homebuyers who largely belonged to racial minorities.[10] This market development went unattended by regulators and thus caught the U.S. government by surprise.[11]

Maybe, maybe not. I listened to some comments from a used car salesman. When the economy gets flakey, more upper income folks will buy used..

Correct. One of the best pieces of advice I got early was: “Never borrow to buy a depreciating asset” (car, for example). Especially an asset that depreciates faster than your loan will pay it off. My car dealer friend used to “roll over” people’s leftover trade-in loan balances into their new car. Guess where that leads. A larger leftover balance later.

JoeBama Economics: Keep pumping out hot money and raising interest rates to keep inflation in check.

Jimmy Carter did it too.

BRILLIANT!

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Let’s be honest, no matter what is done there is no easy solution. The payment for bast bad decisons must be made.

The cure is tough times. How many of us would vote for that solution?

Don’t worry just put it on the Feds CC. CBO says $2T Fed deficit for the next ten years and no one batted an eye.

> People paying 50,000 for a car on credit are insane. <

Truck prices are even crazier. For example, the 2023 Ford F-150 Limited is listed at $83,010. Who the heck is buying those things?

“That’s OK, they’ll all just buy EVs”

Yep, come next year low income earners whom don’t pay any Federal tax will still get $7500 off a qualifying EV thanks to those that do pay tax and Bidens printing press. And I have no doubt Biden and his Socialist Democrat party will threaten lenders to make high risk loans that they wouldn’t otherwise to get these non taxpayers into EV’s. The defaulting on Auto loans, you haven’t seen anything yet.

Margaret Rowe, senior director with Fitch, wrote “They [subprime auto loans] can often be a first line of where we start to see the negative effects of macroeconomic headwinds.”

Come on, Margaret, you can finger the root cause better than that. This is not just some ill winds that randomly blew up out of nowhere.

In late January, we Fitch revealed tat consumers are falling behind on auto payments – the most since the peak of the Great Financial Crisis.

Not that I’m a fan, but the article seems to single out those fond of body art.

Never pay cash when you can pay with free money from other people. I have excellent credit and can almost always (harder now) find free money somewhere.

[The perfect storm we described earlier this year is unfolding.]

Like I’ve said, 2008 will happen again.

Can’t have them do all these stupid things and not have bad things happen.

There has almost been no interest in the auto strike. It used to be a big deal.

I would like to replace my 2010 Hyundai. As mentioned elsewhere, maybe the defaults will flood the market with used cars and depress prices.

If it’s used for business you can write off depreciation. My friends who restore houses do such for their vans and trucks.

But the majority of large trucks are for personal transportation.