Discover Financial enjoyed healthy growth in card sales and loans receivables in the third quarter of 2012.
Loans based on receivables and inventories can be quickly liquidated, which is exactly what is happening.
Such activity could even be coupled with purchases of bundles of securitized consumer loans, credit card receivables and even corporate securities.
Turns out that the Primary Fund, like many other money market funds, made significant investments in asset-backed commercial paper (ABCP), which offered juicy yields, but did so because they were backed by things like mortgages, auto loans, credit card receivables and other risky assets that, despite their risk, came with investment-grade ratings.
Many businesses applying for loans are looking to finance receivables and other working capital, according to a new survey of bankers by Sageworks, a financial information company.
America's government is working hard to revive markets for securitised debt, aware that banks lack the balance-sheet capacity to absorb all of those credit-card receivables and auto loans.
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Since 1986 the company has been financing the medical equipment and, later, receivables of healthcare providers, securitizing some of the loans and leases, and selling them to investors.
Secretary PAULSON: Approximately 40 percent of U.S. consumer credit is provided through securitization of credit card receivables, auto loans, and student loans, and similar products.
Morgan Stanley and other big firms are also starting to rebuild their securitization business, which pools together auto loans, credit-card receivables, and other forms of credit, and then issues bonds backed by them.
Fearful of prosecutors and trial lawyers, the accounting profession is already aggressively pressuring companies to massively write down the value of securities with subprime mortgages or other consumer receivables, such as auto loans and credit cards.
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