Dedicated to Deposits: Deals, Data, and Discussion
Featured Savings Rates
Featured Accounts

Special Report: How The Fed Fueled An Explosion In Subprime Auto Loans

Thursday, May 2, 2013 - 8:20 AM
BUBBLE TROUBLE

Critics of the Fed say the growth in subprime auto lending is just one of several mini-bubbles the bond-buying program has created across a range of assets - junk bonds, subprime mortgage securities, and others. The yield chase delivered big windfalls to some Wall Street firms and hedge fundsholding securities that soared in value. But so much money has flowed into these assets, the critics say, that the markets for some are beginning to resemble the housing boom in the run up to the financial crisis.

"It's the same sort of thing we saw in 2007," said William White, a former economist at the Bank for International Settlements. "People get driven to do riskier and riskier things."

http://www.reuters.com/article/20...0ES2013040
2
ShorebreakShorebreak2,700 posts since
Apr 6, 2010
Rep Points: 14,636
Reply