I have a new article up at LibertyNation.com that takes a look at the subprime auto loan market in the United States. This will likely be President Donald Trump’s major financial crisis sometime in his first term in the Oval Office.
A new debt bubble has formed in the U.S. economy concerning auto loans. As this frightening balloon takes in more air, President Donald Trump may soon find himself in a financial crisis the likes of which his democratic predecessor confronted when he took office in 2009. This news is a bit more than worrisome.
Auto loans are poised to grind down the U.S. economy in the next couple of years similar to the housing bubble of 2008. Here’s why: Analysts are beginning to allude to the various warning signs: total auto loan debt has reached a staggering $1.1 trillion and delinquency rates are going up and subprime lending is a dominant theme.
For close to ten years, consumers have had the ability to borrow money at historically low interest rates. Thanks to seven-year auto loan promotions and motorists purchasing vehicles without any money down, reckless spending has been rampant – there was a $96 billion increase recorded in auto loan debt in 2016.
As the Federal Reserve begins to gradually raise interest rates, borrowers may find themselves under water.
You can read more here.