Bankruptcy (Not) News: Banks Still Winning

Sarah Lazare wrote this story a while ago for the BIBbanksWIN

Common Dreams website:

Holder’s six years of service under the administration of President Barack Obama were defined by his refusal to criminally prosecute any of the financial institutions that drove the 2008 financial meltdown and subsequent recession.

“If we had a more aggressive media, this would be an enormous scandal, more than the decamping of former Obama Administration officials to places like Uber and Amazon,” wrote David Dayen in Salon on Tuesday. “That’s because practically no law firm has done more to protect Wall Street executives from the consequences of their criminal activities than Covington & Burling.”

The Who sang it a long time ago: “meet the new boss, same as the old boss.”

The working class exists for the benefit of Goldman Sachs.

Tens of thousands of people were forced into bankruptcy when the real estate bubble burst in 2007-2008.

They got NO relief from the government, neither reform of bankruptcy laws nor any other meaningful relief.

Meanwhile, our tax dollars went to prop up the crooks who created the mess.

The Fed has kept interest rates low, near zero return for savers.

BUT, enormous profit center for the Big Banks, which get to borrow the Fed’s money for next to nothing, then lend it to us for cars, credit cards, homes, et cetera, and charge 30% or more.

In 2015, car loans were the big gainers.

Record car sales, yes, good, yes, I am a lifelong Detroiter.

But:

Overall, the industry is in a position to sell a record number of cars to U.S. consumers this year.

But the amount owed is up 11 percent, a sign of the increase in the size of car loans due to rising prices.

The average amount borrowed is about $21,700, and buyers owe nearly $18,000 on average. The average new car purchase price now stands at $32,529, according to sales tracker TrueCar. The average car loan balance is rising faster than it is for mortgage loans, according to TransUnion.

Big delinquencies have not hit car loans, yet.

But the average loan length is also increasing.

And when you get to the 3rd, 4th, 5th, 6th, and even 7th year of that vehicle loan, the debt is much more than the vehicle value.

With most American families one missed paycheck from defaulting on some debt, how much of that record trillion dollars of car loan debt is going to actually be repaid?

Or will it just be the next bubble to collapse and drive folks into bankruptcy court?

And will the government then bail out the banks, or the consumers???

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