I was listening to a piece on this morning's news (ABC with commentary from Cox Automotive) about the higher rate of car loan defaults being generated by a combination of higher prices and higher interest rates.

OK, that makes a lot of sense, and increased consumer debt is a contributing factor to recessions, etc.

But being a cynic at heart, I did a bit of research and came up with the following data:

In depth view into US Auto Loans Delinquent by 90 or More Days including historical data from 1999 to 2023, charts and stats.

https://ycharts.com/indicators/us_auto_loans_delin...

https://www.axios.com/2023/08/15/credit-loan-delin...

So maybe August's data will be terrible, but compared to historical numbers, while the credit card trend is rotten not mentioned in the news piece), the car loan default rate appears to be about average and the news story seems to be serving someone's interests.

It does, however, point to a useful data stream which should be watched as the underlying theory of increased defaults is plausible and if/when true, a canary in the coal mine.

Jeff

Macroeconomic Trends and Risks FAQ

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