The Next Subprime Crisis Is Here: 12 Signs That A Day Of Reckoning Has Arrived For The U.S. Auto Industry
In recent years, the auto industry has been able to boost sales by aggressively pushing people into auto loans that they cannot afford. In particular, auto loans made to consumers with subprime credit have been accounting for an increasingly larger percentage of the market. Unfortunately, when you make loans to people that should not be getting them, eventually a lot of those loans are going to start to go bad, and that is precisely what is happening now. Meanwhile, automakers and dealers are starting to panic as sales have begun to fall and used car prices have started to crash. If you work in the auto industry, you might remember how horrible the last recession was, and this new downturn could eventually turn out to be even worse. The following are 12 signs that a day of reckoning has arrived for the U.S. auto industry…
…..Now, it seems that growing fears over the flood of new inventory slated to hit the New York market combined with the Fed’s promise to keep hiking interest rates has sellers slightly more willing to compromise.Per the following quarterly Manhattan market update from Douglas Elliman, the median sales price for apartments in the Big Apple dropped 3.3% YoY in 1Q 2017…..Sellers who had been holding fast to ambitious pricing goals are softening their stances as they face the prospect of higher mortgage rates and more listings being added to the Manhattan market. In the three months through March, buyers of resale homes got discounts averaging 4.5 percent off the last asking prices, up from 2.7 percent reductions a year earlier.
And this of course begs the question. With the Syrian Army and its allies in a comfortable position in Syria, making advances across the country, and recovering lost points in rural Hama, why would they now resort to using chemical weapons? ……Meanwhile, pick up trucks have been photographed around bodies of those killed. Again, it must be questioned why there are people around sarin gas without any protective gear, and not affected at all when it can begin attacking the body within seconds? Also, the pick up trucks remain consistent to what local sources have said that many of those dead were kidnapped by Al-Qaeda terrorists from pro-government towns in rural Hama……..All evidence suggests this is another false chemical attack allegation made against the government as seen in the Khan-al-Assal 2013 attack where the terrorist groups hoped that former President Obama’s “red-line” would be crossed leading to US-intervention in Syria against the government.
Ralph Lauren Corp., reeling from tumbling sales and profit, will close its flagship Polo store on Fifth Avenue, revamp its e-commerce operations and cut jobs in a $370 million shake-up. The move follows the abrupt announcement in February that Chief Executive Officer Stefan Larsson was leaving the fashion house………The moves are part of Larsson’s so-called Way Forward Plan that started last June. The company has eliminated layers of management, slashed 1,000 jobs and closed about 50 stores. It is also selling less merchandise to department stores, which have hurt the brand through heavy discounting. Ralph Lauren is refocusing on its three core brands: Ralph Lauren, Polo and Lauren.
However, the overall credit quality of borrowers has not kept pace with improvement in the aggregate economy. Our prior Evidence Lab work posits that about 38% of US consumers do not generate positive cash flow and roughly 25-30% of US consumers have not seen improving consumer finances (i.e. they do not own their own home or have significant wealth tied to stock markets). As of Q4’16, 18% of US consumers indicated they were likely to default on one loan payment over the next 12 months vs. 13% in Q3’16. This cohort of at-risk consumers reported being about 4x as likely to embark on a major durable goods purchase (e.g. house, car) in the next year. This is not just a theoretical issue, but perhaps a problem already. 37% of those aged 21-34 in Q4’16 stated they were likely to default on one loan over the next 12 months, up from 27% in Q3, and outpacing other age brackets. We have only asked this specific question twice before in our Evidence Lab Survey and will be keen if these trends continue in our Q1 survey.
For months, CNN has been all over stories that attempt to undermine the legitimacy of Donald Trump’s presidency by suggesting ties to Russia. It would be impossible to catalogue the hourly drumbeat of “new” stories on this angle that have gone on for months, despite the lack of named sources or actual evidence. The cable news outlet heavily pushed the infamous “Russian dossier” story that was quickly harmed by BuzzFeed showing how dubious to the point of laughable the dossier was. The network’s obsession extends to running red-washed photoshopped graphics of Trump advisors in front of St. Basil’s. The Russia scare headlines run into the dozens each and every day…….
There are, of course, instances where Trump is imposing genuinely new destructive policies, such as his deportation crackdown, increased civilian massacres, and the rollback of vital regulations. But in the case of Egypt and Bahrain, the only new aspect of Trump’s conduct is that it’s more candid and revealing: rather than deceitfully feign concern for human rights while arming and propping up the world’s worst tyrants — as Obama and his predecessors did — Trump is dispensing with the pretense. The reason so many D.C. mavens like Diehl are so upset with Trump isn’t because they hate his policies but rather despise his inability and/or unwillingness to prettify what the U.S. does in the world.
Payless ShoeSource’s bankruptcy filing has propelled Fitch Ratings’ U.S. retail default rate higher and kept the sector on track for up to $6 billion of defaults this year in the latest blow to retail bondholders…….Fitch is expecting the rate to spike to 9% by year-end as retailers continue to struggle with slowing traffic, shrinking margins caused by steep discounting and the competition from juggernaut Amazon.com. Consumer behavior is also changing with experiences and services more in demand than “stuff”……The first lien loans were bid at 38 cents on the dollar on Tuesday and the second-lien loans at 13 cents on the dollar, suggesting low recovery prospects.
One of the greatest speeches by Martin Luther King, Jr., “A Time To Break Silence” was delivered at Riverside Church, New York City, on April 4,1967.This speech was King’s public announcement of his opposition to the war……”Over the past two years, as I have moved to break the betrayal of my own silences and to speak from the burnings of my own heart, as I have called for radical departures from the destruction of Vietnam, many persons have questioned me about the wisdom of my path…..Now they languish under our bombs and consider us, not their fellow Vietnamese, the real enemy. They move sadly and apathetically as we herd them off the land of their fathers into concentration camps where minimal social needs are rarely met. They know they must move on or be destroyed by our bombs. So they go, primarily women and children and the aged. They watch as we poison their water, as we kill a million acres of their crops. They must weep as the bulldozers roar through their areas preparing to destroy the precious trees. They wander into the hospitals with at least twenty casualties from American firepower for one Vietcong-inflicted injury. So far we may have killed a million of them, mostly children. They wander into the towns and see thousands of the children, homeless, without clothes, running in packs on the streets like animals. They see the children degraded by our soldiers as they beg for food. They see the children selling their sisters to our soldiers, soliciting for their mothers……
It’s a pretty remarkable fact that—first of all, it is a joke. Half the world is cracking up in laughter. The United States doesn’t just interfere in elections. It overthrows governments it doesn’t like, institutes military dictatorships. Simply in the case of Russia alone—it’s the least of it—the U.S. government, under Clinton, intervened quite blatantly and openly, then tried to conceal it, to get their man Yeltsin in, in all sorts of ways. So, this, as I say, it’s considered—it’s turning the United States, again, into a laughingstock in the world……Just a couple of days ago, the former U.S. ambassador to Russia, Jack Matlock, came out and said he just can’t believe that so much attention is being paid to apparent efforts by the incoming administration to establish connections with Russia. He said, “Sure, that’s just what they ought to be doing.”