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Subprime auto loans.

• omegaham 9y ago
  I see this as fundamentally different, mostly because it is far easier to repo a car and auction it off than it is to foreclose on a house and sell it to someone else. Another thing is that no one is wildly pricing cars; the fact that lots of subprime people are buying cars does not drive up the price of cars for everyone else. Thus, if a whole bunch of subprime borrowers default, the rest of us aren't sitting there with a car that's actually worth a quarter of what we thought it would be worth. We also don't keep an enormous share of our equity in cars the way that we do in housing.
  • uptown 9y ago
    True. Except it may be able to be used as a proxy for larger economic issues. If borrowers are defaulting on their car loans at a higher rate than usual, it begs the questions: "why" and "why now"?