Huge bankruptcies for used car firms have exposed Wall Street’s entanglement with the sector. Far from derisking after the Great Recession, banks rebuilt the economy on obscure financial intermediaries that are now sinking.
If the housing market crashes, unfortunately, it won’t be good for anyone good. Last time it crashed in 2008 it led to a historic high loss of, I want to say, 20%, which is a ton, but if you couldn’t afford a down payment before, that kind of drop won’t change that, plus, last time, lenders to individuals were reticent to lend because of the ensuing economic downturn.
In the end, it just meant that private equity and other investors bought up a shitload more of the housing market and it became even more consolidated.
It isn’t as optimistic as that. If I understood it right, it’s just a couple used car private equities that did some shady banking in order to not have to use their own money to pay for the cars they were selling, then going bankrupt because the customers couldn’t keep up with the over inflated monthly payments.
So the only people that were screwed were the customers. The “companies” that declared bankruptcy were likely just shells playing with other people’s money. Used car prices are unaffected.
They’re already doing that around here. A new build housing estate that’s barely been up three months already has homes for sale for about £50k more than they were new.
It’s about time. Houses next, please.
If the housing market crashes, unfortunately, it won’t be good for anyone good. Last time it crashed in 2008 it led to a historic high loss of, I want to say, 20%, which is a ton, but if you couldn’t afford a down payment before, that kind of drop won’t change that, plus, last time, lenders to individuals were reticent to lend because of the ensuing economic downturn. In the end, it just meant that private equity and other investors bought up a shitload more of the housing market and it became even more consolidated.
It isn’t as optimistic as that. If I understood it right, it’s just a couple used car private equities that did some shady banking in order to not have to use their own money to pay for the cars they were selling, then going bankrupt because the customers couldn’t keep up with the over inflated monthly payments.
So the only people that were screwed were the customers. The “companies” that declared bankruptcy were likely just shells playing with other people’s money. Used car prices are unaffected.
They’re already doing that around here. A new build housing estate that’s barely been up three months already has homes for sale for about £50k more than they were new.