More pain ahead. Soaring bond yields will bring 10% interest on car loans

[1srelluc]

Americans are about to feel the impact of soaring bond yields, Blackstone president says

Surging bond yields are raising interest rates on everything from mortgages to personal loans, spelling trouble for resilient consumer spending.

markets.businessinsider.com

American consumers are about to feel the sting of soaring bond yields, Blackstone president Johnathan Gray said.

Bond yields, which impact borrowing costs for all kinds of loan products, moved higher this week as investors fretted over higher-for-longer interest rates. After notching a 16-year-record earlier this month, the yield on the 10-year Treasury bond continued to surge on Thursday, rising to 4.958%.

"When 30-year mortgages and car loans cost you 8 percent it will impact consumer behavior," Gray said in an interview with Financial Times on Thursday. "Growth has been remarkably resilient, but if you keep policy this tight, this long, invariably you will cause the economy to slow down."

In some corners of the economy, rising yields and higher borrowing costs have already been acutely felt. Rates on the 30-year fixed mortgage just notched 8% this week for the first time since 2000, with the steady rise to that level in the past year putting the US housing market in a state of paralysis and bringing transaction volume to a 13-year low.

Meanwhile, the rate on 24-month personal loans at commercial banks notched 12% in August, the highest borrowing cost since 2007, Federal Reserve data shows.

That's bad news for US consumers, who have been a pillar of economic strength in the last 18 months of monetary policy tightening by the Federal Reserve.

Consumers' resilient spending spree could soon grind to a halt though amid rising debt costs.

Households may have already run out of excess savings last quarter, according to the San Francisco Fed, and student loan payments for 43 million borrowers just resumed at the start of October. Around 34% of borrowers say they won't be able to make their payments, according to a recent Morgan Stanley survey.


That will hopefully mean less demand and auto prices will drop, or at least the stealership will offer better deals.

JPow said it yesterday: wages are still too high, economy is still too good, still too much money chasing too few goods, inflation still too high......Higher for longer just became even higher for even longer.

Hope everyone is happy with what they have for now because loan rates are going to suck for a good while.

 

[shockedcanadian]

Americans are about to feel the impact of soaring bond yields, Blackstone president says

Surging bond yields are raising interest rates on everything from mortgages to personal loans, spelling trouble for resilient consumer spending.

markets.businessinsider.com

American consumers are about to feel the sting of soaring bond yields, Blackstone president Johnathan Gray said.

Bond yields, which impact borrowing costs for all kinds of loan products, moved higher this week as investors fretted over higher-for-longer interest rates. After notching a 16-year-record earlier this month, the yield on the 10-year Treasury bond continued to surge on Thursday, rising to 4.958%.

"When 30-year mortgages and car loans cost you 8 percent it will impact consumer behavior," Gray said in an interview with Financial Times on Thursday. "Growth has been remarkably resilient, but if you keep policy this tight, this long, invariably you will cause the economy to slow down."

In some corners of the economy, rising yields and higher borrowing costs have already been acutely felt. Rates on the 30-year fixed mortgage just notched 8% this week for the first time since 2000, with the steady rise to that level in the past year putting the US housing market in a state of paralysis and bringing transaction volume to a 13-year low.

Meanwhile, the rate on 24-month personal loans at commercial banks notched 12% in August, the highest borrowing cost since 2007, Federal Reserve data shows.

That's bad news for US consumers, who have been a pillar of economic strength in the last 18 months of monetary policy tightening by the Federal Reserve.

Consumers' resilient spending spree could soon grind to a halt though amid rising debt costs.

Households may have already run out of excess savings last quarter, according to the San Francisco Fed, and student loan payments for 43 million borrowers just resumed at the start of October. Around 34% of borrowers say they won't be able to make their payments, according to a recent Morgan Stanley survey.


That will hopefully mean less demand and auto prices will drop, or at least the stealership will offer better deals.

JPow said it yesterday: wages are still too high, economy is still too good, still too much money chasing too few goods, inflation still too high......Higher for longer just became even higher for even longer.

Hope everyone is happy with what they have for now because loan rates are going to suck for a good while.

What is the U.S T-Bill rate at now?

 

[1srelluc]

What is the U.S T-Bill rate at now?

5.7%

1 Month Treasury Rate is at 5.57%, compared to 5.60% the previous market day and 3.30% last year. This is higher than the long term average of 1.35%.

 

[shockedcanadian]

5.7%

1 Month Treasury Rate is at 5.57%, compared to 5.60% the previous market day and 3.30% last year. This is higher than the long term average of 1.35%.

Yeah I looked it up. This is a nice return for no risk.

 

[TroglocratsRdumb]

By Financial Samurai / 08/18/2023

According to Kelley Blue Book and the Bureau Of Labor Statistics, the average new car price at the beginning of 2023 is $49,388! That is an absurd amount of money to be spent on a car.

The Average New Car Price Is Unbelievably High

If you were to guess what the average new car price is nowadays, what would you guess? I guessed $25,000, since my Honda Fit is sweet for an economy car and only costs $19,600 new. Given I'm frugal, leaving a 20% upside pricing buffer seemed logical. Too bad I was way off! According to Kelley Blue

www.financialsamurai.com

New Car Market: Prices Are About To Plummet — Is Now the Right Time To Buy?

The U.S. car market has shifted into lower gear in only a matter of months. After average car prices hit record highs as recently as last summer, some analysts now predict that an oversupply of...

finance.yahoo.com

The price of a new car is outrageous.
People can't afford them.
Car sales are down.
It's cheaper for people to just keep their old car.

 

[bdtex]

It's cheaper for people to just keep their old car.

It's always been that way.

 

[there4eyeM]

Perhaps this will persuade buyers to chose reasonable vehicles. The preference for fat, under-performing cars should never have arisen and is long overdue to end. The very few frustrated late-adolescents who insist on hundreds of horsepower have to stop poisoning and robbing the rest of us.
A modern equivalent of the old Beetle is a good basis for thinking.

 

[luiza]

Needs to be checked out with the Wanker .

Feel sure he believes that things could not really be better with a large thank you to our idiot savant President Piss Pants .
" I just do not know what to believe" wrote Mrs Wetpants from England ,

 

[Moonglow]

Americans are about to feel the impact of soaring bond yields, Blackstone president says

Surging bond yields are raising interest rates on everything from mortgages to personal loans, spelling trouble for resilient consumer spending.

markets.businessinsider.com

American consumers are about to feel the sting of soaring bond yields, Blackstone president Johnathan Gray said.

Bond yields, which impact borrowing costs for all kinds of loan products, moved higher this week as investors fretted over higher-for-longer interest rates. After notching a 16-year-record earlier this month, the yield on the 10-year Treasury bond continued to surge on Thursday, rising to 4.958%.

"When 30-year mortgages and car loans cost you 8 percent it will impact consumer behavior," Gray said in an interview with Financial Times on Thursday. "Growth has been remarkably resilient, but if you keep policy this tight, this long, invariably you will cause the economy to slow down."

In some corners of the economy, rising yields and higher borrowing costs have already been acutely felt. Rates on the 30-year fixed mortgage just notched 8% this week for the first time since 2000, with the steady rise to that level in the past year putting the US housing market in a state of paralysis and bringing transaction volume to a 13-year low.

Meanwhile, the rate on 24-month personal loans at commercial banks notched 12% in August, the highest borrowing cost since 2007, Federal Reserve data shows.

That's bad news for US consumers, who have been a pillar of economic strength in the last 18 months of monetary policy tightening by the Federal Reserve.

Consumers' resilient spending spree could soon grind to a halt though amid rising debt costs.

Households may have already run out of excess savings last quarter, according to the San Francisco Fed, and student loan payments for 43 million borrowers just resumed at the start of October. Around 34% of borrowers say they won't be able to make their payments, according to a recent Morgan Stanley survey.


That will hopefully mean less demand and auto prices will drop, or at least the stealership will offer better deals.

JPow said it yesterday: wages are still too high, economy is still too good, still too much money chasing too few goods, inflation still too high......Higher for longer just became even higher for even longer.

Hope everyone is happy with what they have for now because loan rates are going to suck for a good while.

The San Francisco Fed sucks.

 

[Moonglow]

Needs to be checked out with the Wanker .

Feel sure he believes that things could not really be better with a large thank you to our idiot savant President Piss Pants .
" I just do not know what to believe" wrote Mrs Wetpants from England ,

The bond market has been overly screwed since 2020.