U.S. Subprime Auto ABS Delinquencies Hit Highest Level Since 1996
Delinquencies on U.S. subprime auto ABS have eclipsed 2009 recessionary levels and are now at a level not seen in nearly two decades, according to Fitch Ratings.
Subprime delinquencies of 60 days or more hit 5.16% for February reporting, marking the highest level observed since October 1996 (5.96%). During the most recent recession, delinquencies peaked at 5.04% in January 1999. February’s delinquencies are increased 11.63% year-over-year (YoY) and 3.63% month-over-month (MoM).
https://en.wikipedia.org/wiki/Asset-backed_security
uuuh, oooookay. ABS = asset backed security.
what is the ‘auto’ part? automobiles? the securities are backed by the number of automobiles in the auto industry inventory? how about automatic? what is it that’s automatic? the renewal of the term of the security?
Bu, bu, bu, but Dumbocrats and their acolytes keep citing Oblahblah’s economic miracle of low unemployment, saving the world from financial destruction, by borrowing an extra $10 Trillion, saving the car companies, yadda, yadda…..
Low Information voters swallow anything…………
Sub-prime auto ABS are securitizations of pools of sub-prime car loans and leases. Same as sub-prime mortgage securitizations, except with car loans instead of mortgages. Like with mortgage backed securities, the pools are tranched (i.e, sliced and diced) into classes with varying degrees of risk, and supplied with credit ratings from Moody’s and S&P. You may recall how that all worked out with sub-prime mortgages.. At least it is much easier to repossess a car than a house.
But … but … but … the AUTO SALES numbers were GREAT ! under Obama ! He SAVED America’s auto industry !? Remember ? I guess ALL auto sales figures are NOT created equal. Let me guess, some leftist Democrap assigned to some obscure Senate Banking Committee issued a Federal mandate to ease auto-loan qualifications in the name of “equality” or “equal access” or “red-lining practices” …
“Sub-prime auto ABS are securitizations of pools of sub-prime car loans and leases.”
Wow. That is surprising. Not that ABS’s are going bad, but that they exist at all. After the blood-letting of 2008 in the housing market, what form of retarded mutant would buy an ABS?
There really is a sucker born every minute.
Auto manufacturers borrow money at essentially 0% and sell their cars 0 down and 0% or some variation thereof. If they make 30% or more on a 3 to 5 year loan, that’s bound to inspire some greed.
Unexpectedly!