- Prison Planet.com - http://www.prisonplanet.com -
Subprime to the Rescue
Posted By admin On March 5, 2012 @ 3:42 am In Money Watch | Comments Disabled
USA Watchdog 
March 5, 2012
Subprime lending is back, and it is creating headlines like: “February auto sales rise to highest level in 4 years.” That comes from a story last week from Reuters. Reuters goes on to say,“U.S. auto sales rose nearly 16 percent in February and the annual sales rate leapt to its best level in four years . . . For a second month in a row, sales surpassed even the most optimistic expectations. Analysts ascribed the gains partly to rising consumer confidence and upbeat U.S. economic data.” (Click here for the complete Reuters story.)  Subprime lending was one of the major causes of the 2008 economic meltdown. You would think the banks and the government would have learned a lesson, but they did not.
Subprime auto lending played a big part in those car sales figures. According to published reports, people with a credit score of just 500 can now get a car loan . As of last August, more than 40% of car loans were given to subprime borrowers . That number is growing according to Loans.org. It said two weeks ago, “Due to a new trend that many lenders have begun to participate in, more and more subprime borrowers were able to obtain vehicle financing. As a result, outstanding car loans rose by 3.8 percent, which is roughly $23 billion. That sharp uptick in outstanding vehicle financing brings the national total to $658 billion.” (Click here to read the complete Loans.org story.) 
Nothing gets the economy going faster than loaning money to people with a high chance of not paying it back. Mind you, the economy is not improving because of increased exports, productivity gains, some sort of new technology or dynamic innovation. It appears to be improving (somewhat) because of the return of subprime lending. If that is not a sign of the impending doom of another future crash, I don’t know what is. If we could only put people back to work as fast as someone could qualify for a subprime car loan, we’d be able to fix America’s chronic unemployment problem—at least for a little while.
Article printed from Prison Planet.com: http://www.prisonplanet.com
URL to article: http://www.prisonplanet.com/subprime-to-the-rescue.html
URLs in this post:
 USA Watchdog: http://usawatchdog.com/subprime-to-the-rescue/
 Click here for the complete Reuters story.): http://www.reuters.com/article/2012/03/01/us-auto-sales-idUSTRE82016820120301
 500 can now get a car loan: http://www.bloomberg.com/news/2012-02-07/auto-loans-in-30-seconds-drive-accelerating-vehicle-sales-cars.html
 40% of car loans were given to subprime borrowers: http://www.reuters.com/article/2011/08/30/us-carloans-subprime-idUSTRE77T1EJ20110830
 (Click here to read the complete Loans.org story.) : http://loans.org/auto/news/subprime-car-lending-successful-91976
 Democrats Seek to Add Subprime Relief to Paulson’s Rescue Plan: http://www.prisonplanet.com/democrats-seek-to-add-subprime-relief-to-paulsons-rescue-plan.html
 Obama Housing nominee Mel Watt helped create the subprime crisis: http://www.prisonplanet.com/obama-housing-nominee-mel-watt-helped-create-the-subprime-crisis.html
 Fed didn’t bark at subprime loan abuses: http://www.prisonplanet.com/fed-didn%e2%80%99t-bark-at-subprime-loan-abuses.html
 Pelosi, Reid Urge Paulson to Use Rescue Fund to Aid Automakers: http://www.prisonplanet.com/pelosi-reid-urge-paulson-to-use-rescue-fund-to-aid-automakers.html
 Detroit automakers’ rescue stalls in Senate: http://www.prisonplanet.com/detroit-automakers-rescue-stalls-in-senate.html
Copyright © 2013 PrisonPlanet.com. All rights reserved.