Nottm_S2

Indeed.. buyer beware and all that

i was offered a 'great deal on credit, 8.9% APR!' on a new Yam. Err, i'll pass thanks.

fook me

jimbob

It's not the banks that will suffer on this one I don't think (or student loans- that's us mug tax payers on the hook for that) for a few reasons:
Size of auto loan market is v small compared to mortgage market
Not much slicing/dicing gone on in auto loans for above reasons
Main financer of the loans have been auto companies themselves. It's been said for years that Ford,VW etc are finance companies with a small manufacturing arm attached. VW for example can sell 3 year loans to the ECB for virtually zero interest, then punt it out to consumers at 6+%, a no brainier for them.
As I see it, the only issue for these loans will be if the 3yo cars drop significantly which is possible (if the take up of electric cars gathers pace quicker than anyone currently imagines, they could even have a negative value). I think this unlikely but a more worrying scenario is that when int rates do go up, people will buy into this glut of second hand cars, but new motors will be difficult to shift. We all know people who are driving cars they couldn't afford to if it weren't for low interest rates at the moment. Suspect Land Rover sales for example, would go from current 170k per year to 100k units, where they probably should be (and same for all high end cars)

gaddafi

in itself, not a particularly big deal

but as a possible trigger for a wider crisis, much more significant

a govt can cope with Wayne being unable to afford the monthly payments on his S-line

lots of Waynes having their homes repossessed is much trickier

it's obviously coming but I think we will know it's here before the cars start to be handed back pre term

Nottm_S2

If you think about what triggers these things its often interest rate increases, housing market collapses and weak economic growth

we have one of those but the BOE seem very reluctant to add to that and why would they, they want to reduce the trade deficit and making our money worth nowt helps that i suppose.

its recession or stagflation then...

gaddafi

​​​​​​​stealth inflation is the real game

Nick Graves

...followed by a too-sharp tightening of credit too late, in order to cause another crash.

Nottm_S2

is it stealthy if everyone notices?

a fireblade was £11k in 2011, £15k now..

£14.7k would be 5%pa

gaddafi

how much was a 42" plasma in 2000?

£2000

but what else can you call it when the B of E's main remit is to control inflation?

we're not talking plasmas and bikes here

we're talking about bankster and government debt that needs to be finessed (aka paid for by you and me)

Nottm_S2

finessed as in deflated away?

i think the bike demonstrates the weakness in currency in real terms as they're not made here and i doubt they differ much in that time.. a general slide in the strength of the pound. 10 years ago your £ got you

1.5 euro (now 1.1)
2 USD (now 1.3)
2.5 Aus Dollars (now 1.6)

not pretty

lovegroova

Looking at one metric doesn't really make a lot of sense.
FTSE 100 has gone from 6547 in 2007 to 7447 today + 13.7%
FTSE All share has gone from 3287 in 2007 to 4094 today + 24.5%

Swings and roundabouts.