The NYT reports that Chrysler dealers complain that they lose 20 to 25 percent of their customers because potential buyers can't get car loans. How many customers does Chrysler lose because people don't have enough money to buy a new car?
It would be helpful if the NYT tried to explore what this claim means. Tens of millions of people are far less creditworthy today than they were a year ago because they have no equity in their home or other financial asset of obvious value. Banks will rationally charge much higher interest rates on loans to people without home equity or other financial assets, therefore it is not clear whether Chrysler's problem stems from issues with the financial system or is simply a result of the fact that the country is much poorer today than it was a year ago.
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