There is a major problem brewing the US Auto industry... and therefore the US economy.

Automakers just unleashed a massive production surge to keep the dream alive...



With inventories at record highs (having risen for 61 straight months)...





Which would be fine if sales were keeping up - but they are not...

And now the subprime auto loan market is set to collapse...



And here's why stock markets should care...

To sum up...

The only way automakers are making sales is by lowering credit standards to truly mind-numbing levels.... that cannot last.

China's economic collapse has crushed forecasts for the automakers.

Inventories are already at record highs.

And July saw a massive surge in producton.

What comes next is simple... a production slump - just ask The Atlanta Fed.