Wednesday, March 2, 2016
And This Bubble Keeps Growing
Right now dealerships, both new and used, are setting on top of the world. There just seems to be no end to the buying spree of automobiles right now. Since I am in a way right on the front line of this bubble I can attest that people will agree to anything and buy something no matter what. If McMansions are not available then by golly they will take the next best thing and get a new car for little to nothing down and a payment plan that will make any sane person balk when looking at the costs.
Dealerships simply cannot get cars on to the lots fast enough right now. They are buying them from every available source possible. Trade ins, auctions, re-built, new, each dealership is having dozens of them delivered each and every day.
I read today that car sales for the month of February appear to have eclipsed even the impressive sales of February 2015 at this point.
I also see the buyers and how most of these people can afford these payments is totally beyond me. I can only assume that by and large the general public is as much in debt as our government at this point. Any person who crawls in off the street can get a car loan these days. I honestly think we have sold a few to homeless people as a matter of fact.
Often times I deliver the loan applications and I have witnessed at least half a dozen new offices dealing with auto loans open up in the last few months. Sun Loan this, Reliable Finance that. Bob's burger and car loan company. You get the idea. Someone is cashing in big on this but I can't help but wonder, like with the housing market of 08, just who is going to be left holding the bad debt when this bubble pops.
Actually the answer is easy it will be the tax payers somehow. I guarantee it.
At this point I am unsure who is actually exposed to these toxic loans. If they are bundling them up like they did with the housing market and reselling them to investors I am unaware of who or even if they are doing it at all. It might warrant some looking into though if you are still in the market or reliant on the market in some way.
Keep Prepping Everyone!!!!!