Highland Capital Sees 'Chinks' in Sub-Prime Auto Loans

The video discusses the current state of the auto loans market, highlighting weaknesses in subprime lending and the impact of increasing default rates. It also explores trends in the housing market, noting the effects of rising mortgage rates and low inventory on home buying. Additionally, the video examines the implications of the FOMC minutes, focusing on potential interest rate hikes and balance sheet adjustments, and their impact on the economy and yield curve.

What is a significant concern in the subprime auto lending space?

• Decreasing interest rates

• Increasing default rates

• Rising car prices

• Stable residual values

How might rising interest rates affect the housing market?

• Increase in household formations

• Increase in mortgage applications

• Decrease in home prices

• Encouragement for people to buy homes

What challenge does new home construction face?

• Excessive inventory

• Limited land availability

• High demand for new homes

• Low construction costs

What was the market reaction to the FOMC's discussion on shrinking the balance sheet?

• Steepening of the yield curve

• Flattening of the yield curve

• Increased stock market volatility

• No change in the yield curve

What is the Fed's concern regarding the equity market?

• Overheating

• Lack of growth

• Underperformance

• Stability