[Karen37a]

Hedge Funds that wanted to reap a bigger reward went into sub subprime...or deep prime Auto Loans

Comparisons are being made to the subprime mortgage crisis

They are going to be moving money into other areas like Cash advance.

Let's see what happens

[Mynameisbob]

Where did you get this info from?

[MCNetwork]

There are over $3 trillion of assets under management at hedge funds. Compared to other asset classes, cash advances are just nickels and dimes. Large hedge funds wouldn't be interested because there isn't enough volume to move the needle on their portfolio. Only the small funds with assets under $20 million might be interested in MCA.

[Karen37a]

There are over $3 trillion of assets under management at hedge funds. Compared to other asset classes, cash advances are just nickels and dimes. Large hedge funds wouldn't be interested because there isn't enough volume to move the needle on their portfolio. Only the small funds with assets under $20 million might be interested in MCA.

That isnt true.

3 of my friends( different organizations) have over 1 billion assets under management. Its just not allocated for mca. If big banks and online lending are getting involved other people want to as well.

When I was a kid we had 30 million assets under management

I am just not going to push competition in the direction of the money.

I will be busy all week. New office I took over; furniture and all... debate without me.

Get the coconut shakes out..cheers.

[Karen37a]

PS. Let's get those regulations rolling like you all want so bad

A) Background check

B) Liquidity check

C) Real Time Experience check as evidenced by production only

[splurge37]

Comparisons are being made to the subprime mortgage crisis

These comparisons would have no basis, given that the subprime mortgage crisis was not only tied to an influx of supply of financing for unqualified borrowers, but also to the underlying properties taking a huge dive in value. Subprime auto, in contrast, is tied to a different type of asset that doesn't fluctuate in value like a real estate asset. Although the borrowers may be defaulting at a higher rate, lenders still have recourse of a fairly liquid asset.

[Happy Horse Shit]

These comparisons would have no basis, given that the subprime mortgage crisis was not only tied to an influx of supply of financing for unqualified borrowers, but also to the underlying properties taking a huge dive in value. Subprime auto, in contrast, is tied to a different type of asset that doesn't fluctuate in value like a real estate asset. Although the borrowers may be defaulting at a higher rate, lenders still have recourse of a fairly liquid asset.[/QUOTE]

I guess you have forgotten ALLY Bank (Previous name GMAC who went in the hole for some 17 billion in car financing, they had to be bailed out by The TARP loans.) The loans being made in the last few years are a lot of 6 and 7 year loans--why because the people buying the vehicles are buying more vehicle than their cash flow can handle on a 4 year loan. It is the same thing as lending to no/low doc folks back in the day. They have these people stretched, if one bad event arises in their income stream like a layoff they will default all over the place. When you have large scale defaults the secondary market for cars gets hit. With new cars coming off lease constantly the addition of a large number of repos will definitely affect resale values. Just two years ago when oil prices went in the crapper there was a crisis in the oil patch of people who could not pay for their 70k pickup trucks. It just takes one event to push people over the edge when they are saddled with more debt then they can reasonable handle.---

[Karen37a]

I guess you have forgotten ALLY Bank (Previous name GMAC who went in the hole for some 17 billion in car financing, they had to be bailed out by The TARP loans. The loans being made in the last few years are a lot of 6 and 7 year loans--why because the people buying the vehicles are buying more vehicle than their cash flow can handle on a 4 year loan. It is the same thing as lending to no/low doc folks back in the day. They have these people stretched, if one bad event arises in their income stream like a layoff they will default all over the place. When you have large scale defaults the secondary market for cars gets hit. With new cars coming off lease constantly the addition of a large number of repos will definitely affect resale values. Just two years ago when oil prices went in the crapper there was a crisis in the oil patch of people who could not pay for their 70k pickup trucks. It just takes one event to push people over the edge when they are saddled with more debt then they can reasonable handle.

this

[Karen37a]

And when that fracking oil stuff bottomed out 1 million trucks were repossessed...

sold at auctions for fractions of the black book...not blue book value



Cash advances have renewals....way more attractive to some( I do not have to keep pitching the value of them) accredited investors only **

** this is not a buy sell hold recommendation and I am not an investment advisor, just a 1099 iso...and you can lose all your money

[HDF]

MCAs are not assets. Nor are renewals.

[Karen37a]

MCAs are not assets. Nor are renewals.

That's why the rates are high... more risk more return

* and the book of business is valued at "something" based on historical data ( and it can swing widely based on many factors)

I am not debating further most of you have been 100% wrong so far...

and happy is one of my "friends" of over 35 years..if anyone really wants to know how bond securitizations and private placements, CDOs, tranches etc work...he knows more than me. I am a salesperson

End of thread for me

[HDF]

And the murkiness and problems of securitizations of purchases and sales. But that is probably another thread in another category after the smoke clears..