There's a good reason that car dealers have such a crap public image.

It seems that instead of anyone making anything in this economy, everyone is on the make. Grift is the new currency.

The explosive growth is being driven by some of the same dynamics that were at work in subprime mortgages. A wave of money is pouring into subprime autos, as the high rates and steady profits of the loans attract investors. Just as Wall Street stoked the boom in mortgages, some of the nation’s biggest banks and private equity firms are feeding the growth in subprime auto loans by investing in lenders and making money available for loans.

And, like subprime mortgages before the financial crisis, many subprime auto loans are bundled into complex bonds and sold as securities by banks to insurance companies, mutual funds and public pension funds — a process that creates ever-greater demand for loans.

The New York Times examined more than 100 bankruptcy court cases, dozens of civil lawsuits against lenders and hundreds of loan documents and found that subprime auto loans can come with interest rates that can exceed 23 percent. The loans were typically at least twice the size of the value of the used cars purchased, including dozens of battered vehicles with mechanical defects hidden from borrowers. Such loans can thrust already vulnerable borrowers further into debt, even propelling some into bankruptcy, according to the court records, as well as interviews with borrowers and lawyers in 19 states.

In another echo of the mortgage boom, The Times investigation also found dozens of loans that included incorrect information about borrowers’ income and employment, leading people who had lost their jobs, were in bankruptcy or were living on Social Security to qualify for loans that they could never afford.

Fiddle dee dee, nothing to see here, no one could have predicted, slow news day.

From CNBC …

Avg. Number of New Cars Bought in Lifetime

Pre-recession: 13
Today: 9.4
Source: Polk

Americans Buying Fewer New Cars in Lifetime

There is always risk in any purchase for the buyer and for the seller.

I think there is a lot of scare news out there right now so that everyone is afraid to do anything or take any risk.

If you need car, this is a great time to buy a car.

I traded in my 12 year old car in December 2013. I had done some online research and had driven through a few lots, but on 12/31, I drove through one of the big car lots in West Knox and "saw" my car.

A nice salesman came out and I said, I want that car... and I pointed to my now car. He was very shocked to say the least.

Anyway, it worked out fine. I used a few tricks up my sleeve and they did too, but I got a good deal. I usually pay cash, but they offered me a fixed, extremely low interest rate for 5 years, which was below what my money is earning in this paltry market. So, it was a better deal for me to finance.

My point is, if you need a car, go looking. Life is full of risk. I hope that you won't agree to purchase anything you can't afford to pay for, but don't be afraid to do what you have to do.