7million people say roughly $1000 behind in payments is just $7Billion. $7B out $1300B in total US auto loans. Lenders charge around $50B a year in auto loan interest.
The question is: how big is the profit on these $50B? Because if 7B is not paid it means 7B losses. Losses that have to be recovered somewhere from PROFITS. So from that POV it can be a huge problem. You should not compare a loss with the turnover, you should take the net profit margin. Amazon had for 2018 a net profit that was 4% of the revenues they had. 7B on 50B revenues represents 14%! So 3.5 times the net profit margin of Amazon in losses! Or 3.5 years of profits that would be lost. https://finance.yahoo.com/quote/AMZN/financials?p=AMZN And each year there can, or rather will be certainly, new problematic loans.
Fiat Currency (even the Swiss Franc is now a Fiat Currency) only stays alive when debt is added, which is why virtually all Developed Nations have a huge debt load. At some point, it will come to a nasty end . . . and then start all over again. It's been happening for the last 3,000 + years.
That is a straw-man. AMZN is one company. The 7million delinquent people are spread among many (auto and/or financial) companies. The distribution of losses may not be equal, but it is also possible that no one company holds a significant majority. The article does not differentiate the aggregate.
%% Most all car loans are LOL. NOT charged off; but underwater/depreciation.Plenty of money has been made buying that ''charge off paper/cheap paper''I see your points, speedo; but i pay cash for cars.........