Monday, Nov 24, 2008
Biggest bank in the world nationalised plus taxpayers to fund car loans!
BBC Peston's Blog: Citi and Manic Monday
Worth a read occasionally. This made me especially angry: "If you're shocked by the thought that we as taxpayers may soon be financing car purchases, don't be...The motor makers want to exchange bonds or securities backed by car loans for Treasury bills - which would help them provide finance to those who might still want to buy a car, in spite of the inclement economic weather." If people want to buy brand new cars but can't get loans, they should try SAVING first. Oh no, car sales are falling! When did this country become so utterly perverted....
Posted by doom&gloom @ 12:32 PM (780 views) Add Comment
12 Comments
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1. notaneconomicsguru said...
Apparently, its not just in this country
2. drewster said...
You can no longer buy a house with a 100% LTV mortgage. So why on earth can you buy a car with no money down, even though it's guaranteed to fall in value the moment you drive it off the forecourt?
3. drewster said...
You can no longer buy a house with a 100% LTV mortgage. So why on earth can you buy a car with no money down, even though it's guaranteed to fall in value the moment you drive it off the forecourt?
4. jackas said...
Borrow spend borrow spend borrow spend borrow spend oops
5. techieman said...
Drewster you must know the answer to this,. With a car the finance companies are gambling that they will get enough money back through the loan repayments that they would be able to re-sell the car and re-coup their losses. I would think the default rates arent that big .....yet... In any case surely we have some arfah dailey types on here who could spill the beans.
6. jack c said...
Cars are financed on shorter term, higher margin loans and the actuaries will have factored in a default rate - a car is also more liquid as an asset class than a house ie repo the car today and have it sold at auction same week.
7. malct said...
also after houses for sale, cars for sale is the next big funder of local datami$£ oops newspapers via advertising.
8. malct said...
techieman, jack c, are not car loans sold on quickly in the same manner as mortgage debt anyway?
along with personal debt, student debt and credit card debt.
9. icarus said...
How many people/companies are too maxed out on debt to take advantage of this state-sponsored credit to buy a new car?
I thought capitalism made things that the market wanted. Seems I was wrong. It makes things and then uses its political muscle to create the market.
10. malct said...
icarus, that's certainly true of pharmaceuticals - they create drugs by experimentation and then find as many uses for them as they can persuade people are worthwhile.
11. icarus said...
malct - while we're on the "hey, we've got it, let's push it onto the public" theme it's interesting too to look at how by-products are recycled into new products. Most of the cr@p you can buy in Boots (creams, gels, pastes etc.) is made from the by-products of petroleum processing or of slaughterhouses (rendered fats). Most of the cr@p in processed and fast foods is from the by-products of the over-produced, subsidised crops grown the US.
12. malct said...
icarus - and dare I say it? aluminium waste used in water treatment
The fluoride compounds artificially added to the water supply are sodium fluoride and fluosilicic acid, which are industrial waste byproducts