With consumer behavior under a magnifying glass, Portfolio Manager Jennifer Thomas, shares her assessment of the US consumer.
The consumer asset-backed securities sector is often under heightened scrutiny.
A K-shaped recovery is an uneven one in which some industries and some groups get left behind. That is what we will be watching for in the months ahead.
The subprime consumer sector has come a long way since the dark days of the financial crisis. Borrowers, lenders and issuers have made improvements, but still subprime can’t seem to exorcize its reputational demons. I’ve seen a lot of news coverage recently that reinforces investors’ worst fears.
Subprime. It’s the eight-letter word that turned into something of a four-letter word during the 2008 global financial crisis. Even now, ten years later, that stink has not washed off. Investors have been eyeing subprime auto asset-backed securities (ABS) for signs of trouble, wondering if growing auto debt levels, rising interest rates, deteriorating performance and changing issuer composition could mean the next subprime storm is brewing.