The Car Loan Bubble Just Popped (HUGE Recession Indicator)
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The Car Loan Bubble just popped, which is normally a BIG recession indicator.
Car repos are exploding which usually signals the start of a recession. This is a leading indicator, not a lagging indicator.
“Loan-to-value ratios, or the amount financed relative to the value of the vehicle, are around 140%, versus a more normal 80%”
There are $1.42 Trillion in auto loans, making it the 3rd largest consumer credit market in this country.
Average credit of borrowers has declined which is increasing the risk of default on these car loans.
46% of loans are underwater, meaning people owe more on the car than what it is actually worth.
New auto loans skyrocketed after multiple rounds of stimulus, which brought Q2 of 2021 up to $220 Billion worth of total originations.
There are three big factors to understand why the car loan bubble popped, which we will get into this video.
Thanks for watching and please share this video!
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⏰ Timestamps ⏰:
0:00 – LIVE CALL WITH REPO AGENT
2:04 – Intro
2:32 – Car Repos Are Exploding
3:02 – $1.42T Auto Loan Market
3:45 – New Loans Skyrocketed After Stimulus
5:03 – Credit Scores Are Getting Worse
6:00 – The Automotive Recession Is Here
7:00 – Policygenius Spot
8:12 – Car Prices Reaching Equilibrium
13:01 – How Can You Benefit?
14:17 – My Thoughts.
17:46 – LOL
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I wanna put a comment but then I’m put off by all the scam replies I will get 🤦🏻♂️ anyway, GREAT VIDEO 😆 love the way she shut you down at the end hahaha
My apology’s marco I just deleted it.
@@jhernandez7132014 if you want the deal of a lifetime you’ll have to rimw travel back to 2018.
@@jhernandez7132014 12-24 months as stated in the video. Stack the down payment.
@@jhernandez7132014 I tried to put 10k down for them to lower down their MSRP of 10k but after going back and forth with the dealer, I got up and walked back to my vehicle. BEST CHOICE I EVER MADE.
I wonder how many hellcats will be repoed.
Enough to put hoodville out of business possibly
😂😂😂
Yes
Big facts
I paid cash for mine, maintain it, fix it up……no need to drive the latest model and pay more than it’s worth
2010 GTI!
I bought an investment property and used the monthly cash flow to pay for the used car payment
Both of our cars are paid for and were bought used.
I’m driving a 2004 and it’s beautiful not having a payment. Y’all can have these new fancy expensive pieces of junk
Cheers
It’s because the pause on student loans. People went out and put that extra to a car payment. Now suddenly they depend on forgiveness
good point!
All the forbearance. People were taking advantage or didn’t understand how it works and that money was burning a hole in their pockets
There’s a sucker born every minute
Hate to bring up gender but as a female, I used your tactics/tips when I bought my used 2016 Honda Accord a few years ago and didn’t get railroaded! Paid that sucker off in under a year! It’s been a beautiful thing having a paid off car and one that is very reasonable in gas! Your work through this channel is very much appreciated! I couldn’t imagine being an individual possibly facing a repossession during these unknown times!
Thank you so much that truly means a lot to me
Love your name! 🙂
Sex is female, you’re a woman by gender
Depending on your rate, having a payment is a beautiful thing. I recently did clear title loans on all of my cars I paid cash for at 1.95% right before rates went up. It is actually a beautiful thing to free up more capital that you put to work making you well above its 1.95% cost.
Please link the tactics/strategies that you reference to pay off the car in one year
American consumerism is a rampant disease.
You said it all right there.
Anyone wanting and willing to go out at purchase a 70K new shiny truck right now deserves the payment.
I’m about to that. Buuut I’m trading in my paid off used one worth 60k 😁
@@paulbracewell4915 What USED car do you own that is worth 60K? Please tell because a dealer buying your USED car for 60K will be selling it for 70+K. And Ive never heard of even the worst idiot buying a used car for 70K.
@@meme-yc4ks Are you okay?
@@jalopy2472 That’s the dumbest comment I’ve ever read. And considering that you’re on YouTube, that’s quite the accomplishment. Congratulations.
@@jalopy2472 by your ridiculous comment, then no one needs a car either that’s not in the transportation biz. Just have ur groceries and food delivered. Visit family and friends over FaceTime.
Marco: I’ve been following you for awhile now and I appreciate your content. You are an Akron boy and I am from Mentor, Ohio (and several other places/grew up poor). We share an interest in economics and finance and you break it down very concisely for the layman as well as the intermediate viewers. Keep this content coming and always stay true to your roots of ensuring that it’s always quality and relevant content!
Ty! Born and raised in Cleveland just graduated from Akron 😉
Funny how because Marko doesn’t do the antics he’s not as popular on YouTube.. yet the content is probably the most valuable
Smart people don’t like antics.
Biggest takeaway from this entire economic collapse we’re witnessing is this: DON’T BUY THINGS YOU CAN’T AFFORD!
its crazy isnt it?!
Repeat of 2008?
Or don’t vote democrat
when EVERYTHING is something you cant afford…the days of cheap cars are long past. The magical cheap used toyota that boomers love to talk about so much is a fairy tale.
@@SummitCoyote I bought my 2003 Pontiac Vibe (Toyota Matrix) last December 2021 for $1,400. It had 134,000 miles on it. Runs like a champ. You can find them. I’m not a “boomer,” either.
My mother in law drives (leases) an Infiniti Q50 and she doesn’t have more than $500 in her bank account at any given time. Her auto expense is larger than any other expense she has. When I even mention getting a “cheaper” brand, no way she won’t even hear it for a second because she already downgraded from BMW. She wears Louis Vuitton and Gucci mostly. She’s a maid and currently homeless. So that may be a message to some of you what a car means to someone.
The stimulus money we received was put towards our car loan and we were able to pay it off 2 years & 7 months early. Bought the car in 2018 so we got a great deal compared to the insane prices others have financed.
The stimulus money was for you to feed yourself if you were broke because of a lack of employment
@@glennbeadshaw727 Do tell, what should I have done with the money if my family was able to put food on the table? Waste it on frivolous items such as a new phone, TV, or vehicle?
I paid off debt that had the highest interest rate. I used it to secure my families resources for future recession that was bound to happen under Biden’s rules.
Yep luckily you didn’t need a car during this time, or didn’t make the mistake of buying one you didn’t need. Smart (and lucky people who didn’t lose their job) people put the stimulus towards paying down debt or invested it.
@@Crowdolskee Yea, it helped with my wife’s vehicle since she needed something after learning to drive, my vehicle on the other hand needed repairs that I ended up doing myself like the distributor, fuel pump, & the starter. Thankfully Youtube video’s helped with the difficult task’s & saved me from paying a mechanic. As much as I’d like a newer vehicle that gets better than 16mpg, I’d rather pay off my mortgage first. Only 2 1/2 years left till we’re fully debt free and can focus on our retirement account’s. Till then I’ll continue driving my old ’95 Ford for as long as I can.
@Mike Sells Tampa In truth it wasn’t the only thing that I was using to pay off my debt. We were already putting $1k every month on our loan, so the extra cash helped push our loan down faster. We have two young children so it was an extra $550 a month for us. I’m only assuming, but if people were trying to be responsible with their stimulus money then I’m sure they were already on the right track to pay off their debt. I truthfully think the stimulus plan was a terrible idea and should have never happened. It’s going to hurt us all for years to come, so we were focused on being debt free in the hard times coming.
Comment on the buy here pay here car lots…
Family member who owns one of these lots mentioned to me that he’s made $10K to $20K of pure profit on his 2-3 least expensive cars on his lot. Those 2 cars keep getting sold, Repossessed and sold again quite frequently. Quite funny and entertaining story.
I remember something about car dealers being exempt from regulation by the CFPB under the 2010 Dodd Frank Act. Right after the recession there were huge efforts to get rid of predatory consumer loans, but the auto industry found a way out of it. I think what we are seeing now is more a result of this lack of oversight than anything.
Right after we bailed out car manufacturers
Hey remember that horrible market crash we had with houses that we never want to happen ever again.. duuuhhh let’s do it again but with cars duuuhhhh….
You get it
You’re 100% right about that. Dealerships have some of the loosest financing regulations in the game. Most of them don’t even verify income.
I remember seeing ads from dealerships for no money down and 96 month financing on brand new vehicles. I knew this was exactly going to happen.
3 years into a 96 month loan, the principal will have gone down maybe 25%, but the car will have depreciated by 50% and out of warranty. If car prices do drop as predicted, the depreciation of the collateral will turn more loans upside down even faster.
@@johnstuartsmith Not to mention that used ICE automobiles prices will plummet in 3 to5 years
I just bought a Car, but I don’t have much bills so I can afford it and I can afford to do double payments.
Believe this at your own peril. This is a zero sum game. Make more thorough researches before investing or better still, get a fin. advisor. Made my first million earlier this year through one after losing a fortune to YouTube inspired “trial and error” investing advices. This game is no joke…
Now you have my attention sir… I have been into all of these for sometime and though I won’t say I have lost a fortune, I have squandered quite a lot… Who was/is the knight in shinning amour? I anticipate your response.. How did you do this? I am slowly giving up on all of these…
common knowledge to do the opposite of what they suggest
@@danielchen2857 Funny enough, I can honestly relate. It’s not as easy as it may sound and requires some sacrifices but it is definitely rewarding. I don’t know if I am permitted to drop it here, but her name is “Leah Sandock Marie”. Was in the news a lot in 2018. You can check her out online for more.
@@haydenroberts5568 Thank you
@Hunan Train This right here is the second time I am coming across this name in a week. Came across her podcast and it was lit.
@Marko. You are one of the first one to report this. Right now, a lot of the finance youtube channel are just reporting this. They are so late on this…
Thanks for the heads up on this last week! You are ahead of the game. You are and Reventure Consulting are the ones that I really keep track with since you guys are always well informed.
The lower the market goes, the cheaper everything becomes. You just don’t realize it until after the market inevitably recovers.
You just need a ton of cash to actually benefit from market crash hence having a savings account is essential.
I’m Using this period to accumulate more shares, whatever my hands can get on…
@@hushbash2989 YES. Building wealth involves developing good habits like regularly putting money away in intervals for solid investments. The financial market has plenty of opportunities to earn which I myself took advantage of.. I made my first million from going diverse, mainly stocks, ETFs and bonds. It’s a long term plan for me so I invest and re-invest credits to my Financial Advis0r Patrice Carol Rainer.
@@carter3294 Thanks i will keep making my research & also lookup your advisor on the web. I really appreciate the response, you have no clue how much it mean…
Recessions are where millionaires are created. I feel for the older generation, but if you are young or middle age, you should do everything possible to double and triple your investments.
I agree with you. I overheard someone talking about how a couple made $200k during this red season but it’s risky except you’re being guided by a pro.
@kim. Very true! I’ve been able to scale from $350K to $550K this red season because my FA figured out Defensive strategies to protect my port_folio and profit from this roller coaster market.
@Danzo, I’ve actually been thinking of reaching a portfolio-adviser, my 401k and stocks been losing everything it’s gained since 2019, mind if I looked-up this one coach you use?
Frances Annette Batista is widely known. You can verify her and use her services if you want.
Thank you for this Pointer. It was easy to find your handler, She seems very proficient and flexible. I booked a call session with her.
I live on the east coast of FL and witnessed a huge explosion of boat purchases (and RVs) 2020-2021. I mean boat values 50%+ over pre-pandemic “sane” levels. Starting to see a bit of a bullwhip effect now with a spike in listings. Could you imagine being seriously underwater on a boat you use once a month? A lot of these are going to be bank owned soon too….
During a bear market, the headlines will focus on negative news, whether it’s declining economic growth, geopolitical upheaval, cultural and legal turmoil, or some combination of all three. I listened to a podcast of someone that grew his reserve from $120k to almost $460k during this Red season, can you share tips on how to make such aggressive proceeds in short periods?