{"id":12107,"date":"2015-09-11T06:19:19","date_gmt":"2015-09-11T11:19:19","guid":{"rendered":"http:\/\/olduvai.ca\/?p=12107"},"modified":"2015-09-11T06:19:19","modified_gmt":"2015-09-11T11:19:19","slug":"this-is-another-subprime-waiting-to-blow","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=12107","title":{"rendered":"This Is Another \u201cSubprime\u201d Waiting to Blow"},"content":{"rendered":"<h3 class=\"entry-title\"><a href=\"http:\/\/wolfstreet.com\/2015\/09\/10\/this-is-another-subprime-waiting-to-blow\/\" target=\"_blank\">This Is Another \u201cSubprime\u201d Waiting to Blow<\/a><\/h3>\n<p>Dow down 239 points yesterday \u2013 or 1.5% \u2013 after Japan posted its biggest one-day gain in seven years. This is getting interesting again. If it is just \u201cvolatility,\u201d as Wall Street\u2019s shills in the press maintain, it will probably pass soon. Everything will be okay. Back to routine imbecility before the end of the month.<\/p>\n<p>But if these whipsaw movements are heralding a bear market, U.S. stock prices could be cut in half\u2026 or more. And they may not recover for 10 to 20 years. (Catch up on the details of our bear market forecast\u00a0<a href=\"http:\/\/click2.billbonnersdiary.com\/t\/Ew\/AA\/AA\/AA\/AA\/0tU\/AQ\/iFQ3\" target=\"_blank\"><u>here<\/u><\/a>.)<\/p>\n<div class=\"code-block code-block-3\"><strong>Bull or Bear?<\/strong><\/div>\n<p>Which is it? Bull or Bear? No one knows, of course. But it looks to us as though the whole shebang is getting ready to collapse. So far, the correction has trimmed $12.5 trillion off the value of global stock markets. There are a few reasons for stocks to go back up\u2026 and many reasons why they might want to go down further.<\/p>\n<p>The 2008 global financial crisis was centered on mortgage debt. There was too much of it that couldn\u2019t be repaid. When the value of the collateral \u2013 homes \u2013 headed down, the bubble popped.<\/p>\n<p>Today, consumers have about the same amount of debt. But now the excesses are in auto loans and student debt. As you can see below, total auto loans stood at about $781 billion in 2007. Today, they\u2019ve topped $1 trillion. And student loans have more than doubled over that time to $1.3 trillion.<\/p>\n<p><a class=\"image-anchor\" href=\"http:\/\/bonnerandpartners.com\/wp-content\/uploads\/2015\/09\/091015-DRE-Student-and-Auto-Loan-Debt-Chart1.png\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-22811\" src=\"http:\/\/bonnerandpartners.com\/wp-content\/uploads\/2015\/09\/091015-DRE-Student-and-Auto-Loan-Debt-Chart1.png\" alt=\"091015 DRE Student and Auto Loan Debt Chart\" width=\"540\" height=\"345\" \/><\/a><\/p>\n<p>Again, the collateral is falling in value. Used-car prices fall, as leases expire and more used cars hit the market. As for student debt, the \u201ccollateral\u201d is the earning power of the person who borrowed the money.<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>This Is Another \u201cSubprime\u201d Waiting to Blow Dow down 239 points yesterday \u2013 or 1.5% \u2013 after Japan posted its biggest one-day gain in seven years. This is getting interesting again. If it is just \u201cvolatility,\u201d as Wall Street\u2019s shills in the press maintain, it will probably pass soon. Everything will be okay. Back to [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[3891,6190,3158,8898,5058,1803,2564,4255],"class_list":["post-12107","post","type-post","status-publish","format-standard","hentry","category-economics","tag-auto-loans","tag-bill-bonner","tag-consumer-debt","tag-corporate-debt","tag-mortgage-debt","tag-student-debt","tag-subprime-loans","tag-wolfstreet"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/12107","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=12107"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/12107\/revisions"}],"predecessor-version":[{"id":12108,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/12107\/revisions\/12108"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=12107"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=12107"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=12107"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}