Subprime Consumer Debt Soars To 7-Year High

by JASmius



Hmmm; let's see, wasn't seven years ago....

Hey, wait a minute....:

Subprime consumer borrowing — encompassing auto loans, credit card loans and personal loans — climbed to $189 billion in the first eleven months last year, the highest total since 2007, according to a study compiled for the Wall Street Journal by Equifax.

That borrowing accounted for 41% of total consumer lending outside of home mortgages.

The trend stems from lenders and investors seeking high yields in a low-interest rate environment. So it's no wonder that total household debt rose $306 billion, or 2.7%, in the fourth quarter from a year earlier to the highest level since 2010.

"We're going from an era where for many years credit was extremely tight to an era where credit is now looser," Gabriel Dalporto, chief marketing officer of LendingTree, told the Journal.

Because what could possibly go wrong?

George Santayana wept.

But there's danger here.

No!

Recall that the 2008 financial crisis was triggered largely by subprime mortgages going bad.

Really?  Wasn't 2008, like, ten thousand years ago?  And isn't Barack Obama our messiah now?  NOTHING like THAT could EVER happen on HIS watch, right?  After all, he's omniscient, and only has our best interests at heart.

"It's good while the party lasts, but it's exposing exactly the kinds of people to a negative economic shock that you don't want to expose," Amir Sufi, a University of Chicago finance professor, told the Journal.

I have less than no sympathy for all those fools, morons, and drooling idiots who are going to be wiped out in the bookend panic to 2008 that will cement The One's coup de tat.  Absolutely none.  Bankruptcy, impoverishment, dependency, and starvation will be but the beginning of what they will deserve.  Especially since they will have dragged the rest of us down with them.

And, right on schedule....:

You can add Anthony Mirhaydari, founder of Mirhaydari Capital Management, to the list of those warning that U.S. stocks might be overvalued.

"Nothing, it seems, can shake the faith investors have in this market. And that has me worried," he writes in an article for the Fiscal Times.

There is complacency about many developments, including Greece's debt crisis and low oil prices, Mirhaydari says. Signs of U.S. economic weakness also are arising, such as declines in retail sales and factory orders.

In addition, there wasn't much breadth in the S&P 500's rise to a record high Tuesday, he notes. "Basically, [the stock market rally has] been all about Apple. . . . Outside of Apple, the action has been more tepid," Mirhaydari argues.

All this signals danger, Mirhaydari cautions.

"With the market historically having a tough time in the second half of February, I think we could be in for a violent retest of recent lows, as the bubble of enthusiasm in stocks is popped by any number of these factors hitting home," he notes. [emphasis added]

Hope y'all have your golden parachutes stashed safely away in your mattresses.  We're gonna need 'em in the very near future.