I Would Really Like to Get Elizabeth Warren and Other Progressives On the Record Right Now About Sub-Prime Auto
To me, the sub-prime auto loan market looks exactly like the home mortgage market in about 2006.
Back before 2009, Progressives were pushing like crazy to get banks to write mortgages to low-income borrowers with bad credit. Banks that refused to do so would face the wrath of the banking regulators and lawsuits over redlining and ever other thing the Left could think of. Seriously, if you had tried to stop sub-prime lending in 2006 the Progressives would have excoriated you as being racist, hating the poor, etc. When the whole mess inevitably collapsed, the Progressives suddenly were there blaming this lending to low income people on the banks, accusing them of predatory lending practices.
OK, so now it is 2006 in the consumer credit market, and specifically in auto loans. Banks are making crap loans to no-credit individuals on cars and getting them off the books by securitization. So let's get Elizabeth Warren on the record right now. Should banks stop lending to these no-credit low-income people? My bet is that she would support this lending, doubly so because the Obama Administration feels on the hook still for their GM and Chrysler bailouts and would rather not see these companies tank (which they would if sub-prime credit suddenly dried up). So, before she can piously accuse banks of predatory practices 3 years hence when it all collapses, I want to know what Elizabeth Warren thinks of all this right now.
Update: Well, good news and bad news. Good news is that Elizabeth Warren has criticized sub-prime auto. Bad news is she appears to be totally on the wrong track with causes, talking not about the fact the loans should not be written at all but about the fact that she thinks dealers are reaping huge profits marking up the loans. It would be interesting to see what the Obama Administration would think about a clamp-down on sub-prime auto. Methinks they might freak out at that, knowing sub-prime loans are all that is keeping US automakers out of a new recession.