The Great Recession was caused largely by two things: too-big-to-fail banks gambling big on securities they didn’t fully understand, and the immense amount of bad mortgages given out to satisfy Wall Street’s demand to gamble on the American Dream (if you want to know how it all happened, read All the Devils Are Here). “Subprime” mortgages are the buzzword that we came up with to identify these toxic loans that Wall Street paid off regulators to rate as AAA, and this whole catastrophe from 2008 is replaying itself in the auto market. Per The Washington Post:

A record 7 million Americans are 90 days or more behind on their auto loan payments, the Federal Reserve Bank of New York reported Tuesday, even more than during the wake of the financial crisis.

Economists warn that this is a red flag. Despite the strong economy and low unemployment rate, many Americans are struggling to pay their bills.

“The substantial and growing number of distressed borrowers suggests that not all Americans have benefited from the strong labor market,” economists at the New York Fed wrote in a blog post.

Hmmm…I wonder why not all Americans have benefited from the strong labor market? It’s almost like politicians talk nonstop about jobs in order to avoid talking about wages or something…

The result of trickle down economics pic.twitter.com/kVekrEWtfA — Best Posts (@onlygoodposts1) November 9, 2017

The worst hit parts of the impending “subprime” auto loans crisis are also the most likely to be embroiled in the student loan crisis (read: millennials). What could go wrong?

BREAKING: A record 7 million Americans are 90 days+ behind on their auto loan payments, a red flag for the economy, @NewYorkFed reports.



It's a million more people behind than during the financial crisis era. Many are under 30 years old.https://t.co/bgpsPgghcK#economypic.twitter.com/XdLVLiL5zn — Heather Long (@byHeatherLong) February 12, 2019

This report isn’t all doom and gloom—just like 99% doom and gloom—WaPo notes that “many borrowers have strong credit scores and repay their loans on time, but defaults have been high among “subprime” borrowers with credit scores under 620 on an 800-point scale.”

There’s that buzzword again. The prevailing thought pre-2008 was that these “subprime” loans could not possibly tank the market given how infinitesimally small they were compared to like, a millisecond of Goldman Sachs’ revenue, but the Great Recession proved that what subprime loans lacked in size, they more than made up for in scope. Lehman Brothers, the oldest bank on Wall Street, disappeared in a week after their subprime holdings eviscerated their balance sheet. We should not underestimate the damage these “subprime” loans can do to the economy when widespread default combines with widespread speculation, and yet this Wall Street Journal report from last year begins like this:

Investors are gobbling up auto loans extended to the riskiest borrowers, looking past market warning signs as they reach further for returns.

This year, they have been buying subprime auto securitization deals that offer slices with single-B credit ratings, well into junk territory and the lowest grade offered when such bonds are sold. Auto lenders have issued $318 million worth of single-B debt in 2018, more than all prior years combined, according to data from Finsight.

We learned absolutely, positively, nothing from 2008. We did almost nothing to fix the problems that 2008 revealed, and the only meaningful regulation that President Obama did pass (Dodd-Frank) was rolled back last year with the help of traitorous Senate Democrats like Mark Warner. The bipartisan consensus in Washington is that Wall Street should be allowed to grow ever larger, despite the fact that we are ten years removed from a Wall Street-led event that destroyed at minimum, 40% of middle class wealth. It should be extremely instructive that the Democratic titans of Wall Street told Politico that their “consistent roster of appealing nominees” includes people like Joe Biden, Kamala Harris, Cory Booker, Kirsten Gillibrand and Beto O’Rourke, while “It can’t be Warren and it can’t be Sanders.”

We are barreling head-first into another economic collapse driven by Wall Street exploiting the fact that four out of five Americans live paycheck to paycheck, and those are the kinds of people who need these “subprime loans.” This is why I refuse to give in to that D.C.-centric terminology, as it masks the fact of what these loans really are: predatory crap that should be illegal, which is designed solely to maximize short-term profits to derivatives investors while outsourcing the massive risk these toxic loans create to the public.

This is all by design, and a big reason this market exists is thanks to the Democratic effort led by Bill Clinton, Joe Biden and Nancy Pelosi in the ‘90s to repeal one of the first things we did after the Great Depression, Glass-Steagall. Recently deceased former Democratic congressman John Dingell, the longest serving congressman in American history, called out the Democrats’ corruption with this move for what it was, and if you want a preview of what the “subprime” auto crash will look like, just look to Dingell’s speech in 1999 previewing what the 2008 “subprime” mortgage crash would look like:

I think we ought to look at what we are doing here tonight. We are passing a bill which is going to have very little consideration, written in the dark of night, without any real awareness on the part of most of what it contains.

I just want to remind my colleagues about what happened the last time the Committee on Banking brought a bill on the floor which deregulated the savings and loans. It wound up imposing upon the taxpayers of this Nation about a $500 billion liability …

Having said that, what we are creating now is a group of institutions which are too big to fail. Not only are they going to be big banks, but they are going to be big everything, because they are going to be in securities and insurance, in issuance of stocks and bonds and underwriting, and they are also going to be in banks.

And under this legislation, the whole of the regulatory structure is so obfuscated and so confused that liability in one area is going to fall over into liability in the next. Taxpayers are going to be called upon to cure the failures we are creating tonight, and it is going to cost a lot of money, and it is coming. Just be prepared for those events.

As always with politics in America, we know what the problem is, we just refuse to stop repeating our mistakes because we have an elite political and media class either unable or unwilling to buck their donors. The Real Owners of this country have devised a system specifically intended to rob our humanity for their profit, and it’s only a matter of time before it collapses under its own largesse…again.

Jacob Weindling is a staff writer for Paste politics. Follow him on Twitter at @Jakeweindling.