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RE: Auto Lending Madness - Did Someone Say "Bubble?"
This is really nothing new, and it has far less to do with the auto industry than it does with the banking industry. Interest rates are very low for everything right now.
The thing you have to understand about auto loans, is that theyre basically printing money for the lender. If you don't pay they get the car back (and yeah, they almost always get it back, people are bad at hiding cars.) But it doesnt even matter if they get it back because they can sell the title to a repo company.
I agree it has far more to do with the banking industry than the auto industry.
50%?????!!!!!!! In one year? thats beyond ridiculous, its econ science fiction. Like a 10% fall in revenue, and they'll be shitting themselves. Theyll pay for it with forced, unpaid vacation for ppl in the plants if it comes to that, not by dicking over their suppliers..
The 50% was an arbitrary number. My intention wasn't to estimate how much sales could fall; it was to show how many other businesses falling sales would hurt. I don't think they would screw over their suppliers, but they'd be forced to order less product.