Consumer Credit Drying-up -- Banks HALTING Auto Loans!!!

Consumer Credit Drying-up -- Banks HALTING Auto Loans!!!

The past 10 days in Consumer Credit have been wild and the evidence is explicitly clear: Banks are now severely restricting Consumer Credit:

— Capital One shut off all dealer floorplans (aka inventory lines of credit)

— USA Auto Sales shut down 39 dealerships after losing its Ally Bank floor plan lines of credit

— Wells Fargo laid-off all its junior Auto loan underwriters and capped future loans

This is VERY serious.  This is real DOOM economically. Cars are one of the main pillars of the US economy.

Repos are rising as people can't pay their high loan payments.  In fact, the increase in car repos…300% since new year.

With banks cutting off auto credit, it isn't just car dealerships that will feel the pinch, manufacturers will too, of course.   BUT . . . . those manufacturers contract-out parts manufacturing to hundreds of smaller businesses nationwide.

All those smaller businesses will see orders dry up.  The auto sales and manufacturing sector in the US accounts for over 5 million employees

The "ripple effect" of credit withdrawal will affect the much wider economy and will do so VERY FAST.


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