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US car repossessions surge as more Americans default on auto loans

theguardian.com

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Re: US car repossessions surge as more Americans default on auto loans

#31

Post by dinobones »

harmmonica wrote: post #15

As if I need to make another comment about a, or multiple bubbles, but something has to give and here it's of course the consumer. New and used car prices are at all-time highs (nominal it sounds like, but tell that to someone whose wages haven't kept pace (i.e., almost everyone)). Housing prices are at all-time highs (in terms of price:income so no qualifier needed there). Tariffs are not being 100% eaten by the pro…

On paper, nothing will happen. The wealthy in America will continue to get wealthier. Real estate and stocks will soar in value.

In reality, the dollar's true value will plummet. The FED is starting to lower interest rates again. We are likely going to undergo brutal inflation.

Crashing the economy is obviously very politically unpopular. The left/right will do whatever they can to keep this charade up, even if it means dooming the working class and throwing them some kind of bone to make them think they're ok.

The COVID pandemic was a good example of this. The working class got thrown a $2,000 check while there was billions given to bail out businesses/lots of fraud. Not a lot of people cared because hey, we got a $2k check... Even though that $2k check was not even close to maintaining their relative wealth pre-pandemic due to all of the government's inflationary measures.

There won't be a recession, it won't happen on paper. But the middle/working class will continue to be squeezed. And there will be programs to "rescue us." Maybe it's low cost home programs, maybe it's community college, I'm not sure. But I am sure it will never truly benefit the working/middle class, it'll just be a token to keep them from fully dying.

Re: US car repossessions surge as more Americans default on auto loans

#32

Post by bcrosby95 »

dijit wrote: post #7
bcrosby95 wrote: post #3

Earlier quoted context omitted.

For lots of America alternatives don't take that much investment. Creating a safe bike network would be relatively cheap and is feasible in large swaths of suburbs.

Due to the aforementioned car dependence: points of interest are further apart from each other than in other cities with solid cycling infrastructure (in Europe for example). Enormous car-lots several times larger than the buildings that they serve for example, sprawling 6-lane roads that take 20s to clear a junction on a slow moving bicycle, these things contribute to it being infeasible for more poeple. Connecting…

Yes, they are further apart than they need to be, but they still tend to be within relatively short cycling distance. At certain times cycling is even faster than driving due to gridlock traffic, even in suburbs. For example, this very moment, because the main way through town is clogged with parents picking their kids up from school.

I think a majority of the problem is cultural and/or political. I know people who take a longer drive over a shorter bike ride (due to gridlock traffic).

Re: US car repossessions surge as more Americans default on auto loans

#33

Post by Terr_ »

electric_muse wrote: post #14
jfengel wrote: post #5

I'm surprised it has taken this long. Everything I thought I knew about economics (and basic finance) has pointed in the direction of imminent pain for consumers, but what I've been hearing is more of a dull ache at most. I don't want a crisis, and if we avert one I'll happily update my beliefs. But even if the crisis comes I'll have to figure out why it has been so slow.

You’re probably underestimating how much credit is available to people. Having money issues? Keep paying your car while you borrow money from Klarna for your DoorDash chipotle.

Even as someone who barely cooks, I can't fathom the apparent popularity of DoorDash etc. versus the extra cost you have to pay.

Re: US car repossessions surge as more Americans default on auto loans

#34

Post by jeffbee »

maxerickson wrote: post #26

This has more numbers: https://www.lendingtree.com/auto/debt-statistics/ The main pattern is that people are paying a lot for cars. Looks like a lot of 6 year+ loans in the new market.

Imagine having a credit score of 300 and a $542/mo loan payment on a used car. Cursed. Americans need buses more than ever.

Re: US car repossessions surge as more Americans default on auto loans

#35

Post by carabiner »

harmmonica wrote: post #15

As if I need to make another comment about a, or multiple bubbles, but something has to give and here it's of course the consumer. New and used car prices are at all-time highs (nominal it sounds like, but tell that to someone whose wages haven't kept pace (i.e., almost everyone)). Housing prices are at all-time highs (in terms of price:income so no qualifier needed there). Tariffs are not being 100% eaten by the pro…

We've got an insane bubble right now. Quantum computing stocks are valued at $50b market cap with 0 revenue and no substantial finished products. Just research.

Re: US car repossessions surge as more Americans default on auto loans

#36

Post by epistasis »

dinobones wrote: post #31
harmmonica wrote: post #15

As if I need to make another comment about a, or multiple bubbles, but something has to give and here it's of course the consumer. New and used car prices are at all-time highs (nominal it sounds like, but tell that to someone whose wages haven't kept pace (i.e., almost everyone)). Housing prices are at all-time highs (in terms of price:income so no qualifier needed there). Tariffs are not being 100% eaten by the pro…

On paper, nothing will happen. The wealthy in America will continue to get wealthier. Real estate and stocks will soar in value. In reality, the dollar's true value will plummet. The FED is starting to lower interest rates again. We are likely going to undergo brutal inflation. Crashing the economy is obviously very politically unpopular. The left/right will do whatever they can to keep this charade up, even if it me…

The value of the dollar has already plummeted, 10% or so this year. It's expected that 2026 will have an equal dollar devaluation. This is the best-possible interpretation of the goals of this administration, the so-called Mar-a-Lago Accord that is somehow supposed to help some part of the economy. It's unclear who or how, to me.

Re: US car repossessions surge as more Americans default on auto loans

#37

Post by JohnFen »

ramesh31 wrote: post #22
harmmonica wrote: post #15

As if I need to make another comment about a, or multiple bubbles, but something has to give and here it's of course the consumer. New and used car prices are at all-time highs (nominal it sounds like, but tell that to someone whose wages haven't kept pace (i.e., almost everyone)). Housing prices are at all-time highs (in terms of price:income so no qualifier needed there). Tariffs are not being 100% eaten by the pro…

>So when will the music stop? Seems like it should've been "yesterday," but what's the argument for it to continue playing for the foreseeable future? The great wealth transfer? AI efficiency/productivity gains (without the vast elimination of jobs)? Something else? They seem to have figured out that you can just simply stop caring about the needs of 90% of your population if you systematically withhold any wealth fr…

Historically, this has ultimately led to revolutions.

Re: US car repossessions surge as more Americans default on auto loans

#39

Post by dangus »

ifyoubuildit wrote: post #9
dijit wrote: post #2

It's an extremely inconvenient situation that Americans find themselves in, a sort of self-perpetuating cycle of car dependency that they reinforce because alternatives require far too much investment to make worthwhile. I'm really glad that I can live in a city without having to own a car if I don't want to. It makes a significant difference to my monthly expenses. And, honestly, it's a lot nicer and feels a lot mor…

I'm glad you have that opportunity too, but purely on the financials it's probably not so much of a win when you consider the heightened cost of everything (housing in particular) in a city, right?

You don’t have to be in a large or even a medium sized city for car dependency to be alleviated. There’s a not just bikes video about this exact thing.

https://youtu.be/ztpcWUqVpIg

Re: US car repossessions surge as more Americans default on auto loans

#40

Post by Ekaros »

scotty79 wrote: post #6

I wonder ... who are they gonna send the repossessed cars to? I think old models of operation are breaking down.

Depends on who is operating higher up in value ladder probably ends up in auctions by lenders. But lower cases it is revolving system. Where the seller takes vehicle back and sells it again. Sometimes multiple times...
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