agreed

The outstanding credit numbers are nuts, both in the consumer and corporate spheres

I think that's what is driving a lot of the increase in stock prices

@Zyzz agreed on the decembers, now I'm looking at chains for more near term (also included on the pdf)

lenders get frightened? i can see that happening. what would cause them to get frightened?

I'm saying that there will be a pull back on people seeking credit

especially if interest rates rise

i 100% agree that consumers are buying on credit rather than actual money they are earning

or rather, I'm saying that pullback would be the catalyst

I guess what always frightens lenders, if people default. @Zyzz you gave a pretty good analysis the other day on default rates for the largest asset classes. I actually wanted to ask where you find that data

gonna be AFK for a bit but I'll rejoin later and jump in if I have anything to say.

Hope you do!

@ThisIsChris https://seekingalpha.com/news/3319607-p-e-players-trouble-cashing-subprime-auto-plays

i get a lot of my student loan info from zerohedge

@Zyzz Interesting. If I understand the process your analysis took: 1. You knew that understanding the size and eliinquincy rates of different asset classes was important to know, and then 2. you googled around for articles that talked to each asset class and its delinquincy rates. Is that correct? I'm just trying to understand process, I thought there might just be a single database where you go to get these types of facts, but I also wouldn't be surprised if such a database didn't exist and you just have to know the right question to ask and start googling

And the reason I'm trying to understand process is I'm also trying to learn how to do good research myself of course

Not trying to "question" or something

@ThisIsChris at work we talk about this stuff a lot. that seeking alpha link was something i knew intuitively (subprime auto defaults) but didn't know an actual %. there are a lot of people in SoFl with nicer cars than me and I know damn well they do not make as much money as I do.

student loans I knew about by reading zerohedge. i have also heard anecdotal stories of high debt loads and parent cosigners (you remember cannoliqueen?)

we understand recessions happen every 8 or so years.. the last one was in 2009

we are about due for one. i know the market is frothy and not just the stock market but the RE market as well

its not a question of if but when and what will trigger it

my position is the tax cut will kick out the possibility for a recession a few years. i dont think it'll happen until after trumps reelection

if we look at 2008's recession that was triggered because you had this massive asset class getting bid up in price with easy money (teaser interest rates, very high LTV (loan to value), no doc/no income loans, subprime borrowing, diversity programs for home loans, etc.). and of course you had some predatory practices such as adjustable rate mortgages amongst other things.

the financials crisis could have been avoided if they would have done: 1) require 20% down payment no matter what, 2) require documentation as to the borrower's job and current income. and of course forget about the other social engineering bullshit

poeple like to blame the financial sector for the financial instruments that were created. that only became an issue because the paper they were securitizing was worthless. if the loans were quality loans then that all would have been fine and you never would have had all the defaults and bankruptcies you saw

we are simply trying to kick around some ideas as to what will cause the next recession

it could be an asset price bubble that pops or it could be the fed raising rates to quickly

if trump is successful with cutting immigration you will have upward pressure on wages which will help kick the can down the road. i do think he will be successful here and i do think you will see upward pressure on wages. again, all of this will help

Hmm, that might have to wait for a new congress. Which could help recover from any recession that starts this year. I wonder, do you think the next recession will be so bad as the 2009 one? Will any coming recession even put us into negative growth or just slow us down for a bit?

I wonder if Student Loan defaults would only grow after a recession starts instead of leading to it, looking at this: "The U.S. Department of Education today announced that the three-year federal student loan cohort default rate dropped from 11.8 percent to 11.3 percent for students who entered repayment between fiscal years 2012 and 2013. The trend has moved downward since FY 2010, when the cohort default rate stood at 14.7 percent." https://www.ed.gov/news/press-releases/national-student-loan-cohort-default-rate-declines-steadily

the technical definition of a recession is two or more quarters of negative GDP growth

i am hopeful at the state of the union trump will talk abut the need for immigration reform

aw yiss I hope so

i think the next recession will probably be more akin to 2009 because the boom will have gone on for ~11 or so years. will it be as bad? i dont think so but it wont just be a blip either

yes, i believe student loan defaults may be a lagging indicator of job losses

i wonder if we go thru a period of rapid automation (self driving cars, bank tellers, fast food cashiers, other job??) if the fall out for low IQ people will be so bad to cause a recession

the question is what would come before job losses?

interest rates being too high and companies being unable to get investment project expected returns to pencil?

"to pencil"?

it means to get numbers to make sense to the point where you'd want to invest