Wednesday, June 3, 2015

This is what Greensboro's City Council and Randolph County Commissioners want to invest taxpayer money into

"Average loan term for new cars is now 67 months — a record.

Average loan term for used cars is now 62 months — a record.

Loans with terms from 74 to 84 months made up 30%  of all new vehicle financing — a record.

Loans with terms from 74 to 84 months made up 16% of all used vehicle financing — a record.

The average amount financed for a new vehicle was $28,711 — a record.

The average payment for new vehicles was $488 — a record.

The percentage of all new vehicles financed accounted for by leases was 31.46% — a record."
"The average loan term for new and used vehicles increased by one month, reaching new all-time highs of 67 and 62 months, respectively.

longer loans, those with terms lasting 73 to 84 months, accounted for a record-setting 29.5 percent of all new vehicles financed, an 18.6 percent rise over Q1 2014 and the highest percentage on record since Experian began publically tracking this data in 2006.

Long-term used-vehicle loans also broke records, with loan terms of 73 to 84 months, reaching 16 percent in Q1 2015, rising from 12.94 percent the previous year — also the highest on record…

The average amount financed and the average monthly payment for a new vehicle also increased to record heights. The average new vehicle loan was $28,711 in Q1 2015, compared to $27,612 in Q1 2014. The average monthly payment for new vehicles also rose, moving from $474 in Q1 2014 to $488 in Q1 2015.

Additionally, leasing continued to increase in popularity during the quarter, jumping from 30.22 percent of all new vehicles financed in Q1 2014 to a record high of 31.46 percent in Q1 2015."

"Lenders are reducing their underwriting standards in order to make the loans needed to feed the securitization machine." 

If Bernard Madoff
distributed money received from new investors to older investors
until there wasn’t enough money to continue,
is the global automobile manufacturing and lending market
currently operating under the same structure?

"The Economy Is Rife with Ponzi Schemes

"The Ponzi scheme has been a recurring fixture of economic life..., creating a few millionaires and ruining the lives of millions.

Think Jim Melvin knows?

...this type of behavior can occur spontaneously, even unconsciously, simply by having one expectation feed on another, creating a frenzy of speculation, an inflating economic bubble that is doomed to eventually crash.

Think Pat McCrory understands what is occurring?

...some form of “rob Peter to pay Paul” arrangement has probably existed for as long as large human settlements have.

...a get-rich-quick scheme, with a dash of marketing wizardry, can be made to flourish until the ruse collapses.

...the con artist might promise a phenomenal return of 10 percent each month to persuade someone to put in $100.  The next month two people invest $100 apiece, and $10 gets returned to the original investor while the Ponzi entrepreneur keeps $190.  In this fashion, the pyramiding of the investments continues to grow. Starting from the $100 brought in the first month, and by doubling the number of investors every month, income in the 10th month will reach $46,090.  This is why people who run successful Ponzis amass enormous wealth.  The catch is that there is no graceful way to stop—the entire thing collapses when new investment dries up.

What makes a Ponzi so compelling, though, is that there is no well-defined point at which the crash occurs.  If there were a given implosion point, then Ponzis would not be as pernicious.

...A Ponzi may ultimately be deemed a collective folly. Yet, for a given individual, investing in one is not intrinsically irrational, because it can take some time before the tenuous structure comes toppling down.

It will be the folly of Greensboro's City Council
and Randolph County's Commissioners.

Financial bubbles are a relative newcomer to the motley collection of Ponzis.

...In all cases, it is the sustained rise in prices—or, more precisely, the expectations of an upswing—that keeps the process going.

...Some financial dealings that do not look outwardly like Ponzis may actually reveal themselves to be “camouflaged” instances of a pyramid scheme. They are perfectly legal, and they often arise when businesses manipulate their operations to stay afloat when times are tough.

...If someone scams an investor by pretending that money is being invested productively—and current gains are being matched only by the eventual losses of future investors—the con man can face criminal fraud charges. As with other Ponzis, however, it is possible to run these operations openly and still attract money from the unwitting.