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Thread: Subprime Auto Loans

  1. #21
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    Re: Subprime Auto Loans

    Quote Originally Posted by Goldenboy219 View Post
    Sub prime auto loans are already a major aspect of used car markets. Sub prime does not equal adjustable rate lending and only reflects risk. GM's appetite for risk is growing, I don't see this as an absolute negative.
    Sure they are. I can go into town and find at least a couple of we-tote-the-note places, and I've been in the position previously where I had to pay a higher interest rate on loans for cars. Point is- GM is now government-owned in effect, and GM losses will affect everyone.
    "God is the name by which I designate all things which cross my path violently and recklessly, all things which alter my plans and intentions, and change the course of my life, for better or for worse."
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    Re: Subprime Auto Loans

    Quote Originally Posted by lizzie View Post
    Sure they are. I can go into town and find at least a couple of we-tote-the-note places, and I've been in the position previously where I had to pay a higher interest rate on loans for cars. Point is- GM is now government-owned in effect, and GM losses will affect everyone.
    Sure, I agree. Yet you already have a negative bias towards them, which is somewhat understandable. Do you honestly believe gm can grow revenue without increasing risk?
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

  3. #23
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    Re: Subprime Auto Loans

    Quote Originally Posted by Goldenboy219 View Post
    Sure, I agree. Yet you already have a negative bias towards them, which is somewhat understandable. Do you honestly believe gm can grow revenue without increasing risk?
    What risk is there when Government Motors can go to Congress with hat in hand to beg for another handout?

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    Re: Subprime Auto Loans

    Quote Originally Posted by The_Patriot View Post
    What risk is there when Government Motors can go to Congress with hat in hand to beg for another handout?
    So you are making the case for moral hazard? On what grounds?
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

  5. #25
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    Re: Subprime Auto Loans

    Quote Originally Posted by Goldenboy219 View Post
    So you are making the case for moral hazard? On what grounds?
    Nope, I asked you where was the risk when Government Motors can just go to Congress to bail them out?

  6. #26
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    Re: Subprime Auto Loans

    Quote Originally Posted by lizzie View Post
    Will we never learn?

    I guess since GM is now too big to fail, we can have a car bubble, and the taxpayer can pay for auto loans.

    GM Goes Subprime (Some Companies Just Never Learn) | www.bullfax.com

    edit: I don't start many threads, and wasn't sure if this is the forum where this one belongs, so if it's in the wrong place, would one of the mods kindly move it?
    This isn't new. . . car dealerships have been dealing with subprime loans for years.

    My husband and I bought our first truck together. I didn't even *have* credit - his was 400 something. What they do, here, is snipe you with extra high interest rates. . . our payments were over $500.00/month at 11% interest.

    But we realigned our credit quickly - a year later we refinanced at a 6% interest rate and haven't missed a payment - we've almost paid the truck off.
    Last edited by Aunt Spiker; 07-26-10 at 12:55 PM.
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    Re: Subprime Auto Loans

    Quote Originally Posted by The_Patriot View Post
    Nope, I asked you where was the risk when Government Motors can just go to Congress to bail them out?
    Which is moral hazard. What makes you believe they are taking unacceptable risks due to government involvement? If you are going to make such an argument, you are going to have to identify the weakness in their endeavor.
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

  8. #28
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    Re: Subprime Auto Loans

    Quote Originally Posted by Goldenboy219 View Post
    Which is moral hazard. What makes you believe they are taking unacceptable risks due to government involvement? If you are going to make such an argument, you are going to have to identify the weakness in their endeavor.
    That's not an answer since you're answering a question with a question. I haven't made an argument yet, but when I do I'll let you know. Until then, can you please answer my question?

  9. #29
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    Re: Subprime Auto Loans

    Quote Originally Posted by Goldenboy219 View Post
    Sure, I agree. Yet you already have a negative bias towards them, which is somewhat understandable. Do you honestly believe gm can grow revenue without increasing risk?
    No, but GM losses are now our collective losses.
    "God is the name by which I designate all things which cross my path violently and recklessly, all things which alter my plans and intentions, and change the course of my life, for better or for worse."
    -C G Jung

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    Re: Subprime Auto Loans

    Quote Originally Posted by The_Patriot View Post
    That's not an answer since you're answering a question with a question. I haven't made an argument yet, but when I do I'll let you know. Until then, can you please answer my question?
    Read up on moral hazard and reply accordingly.
    It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
    "Wealth of Nations," Book V, Chapter II, Part II, Article I, pg.911

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