El Coyote Gordo (supergee) wrote,
El Coyote Gordo

From the ridiculous to the subprime

A scary word has returned: There are reports of a big market in subprime car loans. We are told not to worry, because it's not like subprime housing loans. Cars are easier to repossess (there's a movie about that), and there's not going to be the wave of "flipping" and reselling that we had with housing loans. I hope they're right. I also hope that if anyone tries to build complex financial structures on these bad loans, the similarity to the previous disaster will be noticed, and people will not fall for it. But I am cynical enough to imagine new set of complex financial instruments that will get AAA+ ratings because no one looks deeply enough to see what they are based on, and we will once again elect representatives of the primitive Republican tribe, with their quaint animistic belief that the Market can regulate itself, and eventually the mighty and elegant structure built on a foundation of soft shit will fall down, and the experts and the Very Serious People will have no idea how it could have happened.
Tags: finance
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