Posts Tagged ‘mortgages’

“HOUSEHOLD DEBT AND CREDIT REPORT (Q1 2017)
Household Debt Reaches New Peak Driven by Gains in Mortgage, Auto, and Student Debt
The CMD’s latest Quarterly Report on Household Debt and Credit reveals that total household debt achieved a new peak in the first quarter of 2017, rising by $149 billion to $12.73 trillion—$50 billion above the previous peak reached in the third quarter of 2008. Balances climbed in several areas: mortgages, 1.7 percent; auto loans, 0.9 percent; and student loans, 2.6 percent. Credit card balances fell 1.9 percent this quarter.” -Federal Reserve Bank of New York
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Yes…times have rarely been better for bankers.  In total, household borrowing has climbed back to $12.1 trillion − the highest level in five years − with balances growing across the credit spectrum once again, including mortgages and credit cards.  Happy days….  Our bankers have been world-class in providing more capital than ever before for corporations and consumers.  They’re doing a splendid job.  Don’t hate the bankers.  They only did what the government told them to do.  Besides… it’s not their money.  It’s yours.” -Porter Stansberry

For the first time ever, Americans collectively hold more auto loans than mortgages.  Who is borrowing all of this money? Anyone who can fog a mirror…. 40% of all car loans being made this year are to subprime borrowers.  These loans typically have interest rates as high as 20% annually.


What kind of a person borrows money at 20% annually for more than five years to pay for a used car?  Someone who has no incentive to repay the loan.  Calling that deal a “loan” is a misnomer.  It’s a lease with zero residual value.  The borrower will never have any equity – nothing is at stake for him.  He doesn’t even have to return the car… they’ll send a tow truck.” -Porter Stansberry

“Americans owe more money, collectively, than ever before in our history – far, far, far more. We owe at every level: $17 trillion at the federal level; $13 trillion in mortgages; another trillion in student loans; nearly $3 trillion in state and local government debt. Put all of these numbers together and you end up with a $60 trillion pile of obligations. That’s nearly four years’ worth of our entire country’s total production….  We have collectively become addicted to living way, way beyond our means.  My favorite example about how absurd our debts have become? The state of New Jersey still owes $110 million for a football stadium (Giants Stadium) that was demolished in 2010. It won’t retire this debt until 2025….  Keeping this lie alive… the lie that we can afford our debts (or even our defunct stadiums)… has become the most important national goal.”  -S & A Digest   June 15, 2013