Near-term Yachting financial forcast... Used boats.

[tomfl]

Originally Posted by speakeasy

ViribusUnitis, pass the kool-aid.
SNIP

Originally Posted by ViribusUnitis

I still think ya'll are being entirely too pessimistic.


SNIP

Let's keep in mind that the US is still the most productive nation in the world, and a lot of the stuff we build is not all that easy to duplicate. Sure a lot of cars are are being made other places but the top selling car maker in China is GM.

On the other hand no one believes the federal government can continue to borrow 40 cents of every dollar they spend from China.

Back in the 1950s I remember hearing my rich uncle giving the following advice, "I made money when the Republicans were in power and I made money when the Democrats were in power".

The plain fact of the matter is that some people will get along well while others will not get along so well no matter what the economic conditions are.

[ScuzzMonkey]

Originally Posted by ViribusUnitis

I'm going to have to be the voice of disagreement in this call for a declining world.

Snip

Most of this is not un-true, but the ultimate problem is that the productivity improvements are only serving to increase the income disparity. It's certainly true that individuals have been made more productive, but that just means that fewer and fewer of them are being compensated less and less for producing more and more stuff. At some point, you don't have enough of a circuit between production and income to fuel the market. The money is all still there, but it's concentrated so heavily that it almost literally cannot be spent back in the system... you only need so many Maseratis.

If you can cut past the political horse-dip being peddled as news today and get real business opinions behind closed doors, you'll find (or at least, I have found) that most of what businesses perceive as the foot on the brake in the economy right now is a lack of demand. Not enough individuals with enough spending money. So they have no need to hire, because what demand there is they can service out of productivity enhancements, and with the high unemployment, the labor market is depressed so their existing employees will work for less. The business is still profitable; very profitable in many cases. But the profitability is not resulting in the sort of employment expansion that used to occur, which means there is no explosion of consumers to keep fueling it.

Asia may provide some cushion to this problem, or they may miss the boat... when we invent technologies that are finally cheaper than the cheapest labor in their improving economies, what then? Until the productivity/compensation puzzle is worked out, it's hard to see how the cycle is infinitely sustainable.

[ViribusUnitis]

Wow, this is way off topic, but...

It's not a puzzle to be worked out.

When there is a shortage of capital, then capital is priced highly (higher interest rates) and those that have capital become richer more quickly. Generally, they use their greater riches to fund even more factories, and greater capital. Thus any capital shortage results in more capital being created to fill the shortage.

When there is a shortage of labor, then it's priced highly. Those that trade labor for wages become richer more quickly. Higher wages attract more people into the work force. In addition, if employers have to offer high wages, then it's good business sense to improve their factories with additional capital. This frees up more labor for more productive tasks, filling the labor shortage.

With the joining of China, India, and the fUSSR to the global trade system, and their entry into the global capital markets, do you think there is a global shortage of capital, or a shortage of labor? Two and a half billion people suddenly joining the system, with very little capital between them all?

In addition, this is rapidly raising a huge number of people out of poverty. So what if all of the new cruisers are of Chinese or Indian nationality? They have every right to be as happy as Westerners. The world is going to be full of them over the upcoming decades, so we'ed best get used to the idea. Why would ANYONE begrudge them their success? They earned it, worked for it, and built it. If we want success then we must earn it as well.

[ScuzzMonkey]

Well, I guess my point was that there is neither a shortage of capital nor of labor right now; productivity is something that serves to perpetuate that. I understand the theory, but I can also see that it's not working the way you have laid it out right now. This:

Generally, they use their greater riches to fund even more factories, and greater capital. Thus any capital shortage results in more capital being created to fill the shortage.

...is not happening. Because the existing factories are simply being made more productive instead.

Not really sure how to read your response in that light. But as you say, it's way off topic... probably off-board!

[tartansail]

Originally Posted by ViribusUnitis

Wow, this is way off topic, but...

It's not a puzzle to be worked out.

When there is a shortage of capital, then capital is priced highly (higher interest rates) and those that have capital become richer more quickly. Generally, they use their greater riches to fund even more factories, and greater capital. Thus any capital shortage results in more capital being created to fill the shortage.

When there is a shortage of labor, then it's priced highly. Those that trade labor for wages become richer more quickly. Higher wages attract more people into the work force. In addition, if employers have to offer high wages, then it's good business sense to improve their factories with additional capital. This frees up more labor for more productive tasks, filling the labor shortage.

With the joining of China, India, and the fUSSR to the global trade system, and their entry into the global capital markets, do you think there is a global shortage of capital, or a shortage of labor? Two and a half billion people suddenly joining the system, with very little capital between them all?

In addition, this is rapidly raising a huge number of people out of poverty. So what if all of the new cruisers are of Chinese or Indian nationality? They have every right to be as happy as Westerners. The world is going to be full of them over the upcoming decades, so we'ed best get used to the idea. Why would ANYONE begrudge them their success? They earned it, worked for it, and built it. If we want success then we must earn it as well.

+1 Well said.

Interesting data from the World Bank on the numbers in the most extreme poverty over the past 20 years: Poverty
At the time the report was released, there was information showing that the numbers had continued to decrease since 2008 showing that the entire global economy is no longer dependent on the old school "First World". I couldn't find it on a quick look at the site.

It's interesting to contrast global interdependence today with the state of affairs in the US in the early 19th century. Farms, the economic engine of the day, moved west and the stone walls and fields of the Northeast were overgrown. The stone walls are still there. I expect there was grumbling and displacement. The New England farmers probably thought "their" jobs were "shipped west" and then they adapted. Mills and manufacturing replaced the farms and the northeast was a dominant economic power again.

Today, the global economy is more intertwined than the disparate states of the 19th century US. As VU says, why should we begrudge those in poverty successfully competing and improving their circumstances? As Bruce Springsteen said in "My Hometown", "these jobs are going boys and they ain't coming back". We've tended to do a pretty good job of moving on and finding the next opportunity. However, competing as cheap labor isn't likely the path.

[Tropic Cat]

Originally Posted by ViribusUnitis

Wow, this is way off topic, but...

Yes it is. The topic isn't how many 'cruisers' are being created in Asia. The topic is what's happening to our boat pricing...."Near-term Yachting financial forcast... Used boats"

It's great that China and India are creating a middle class. What I take exception to is it appears to be happening at our expense.

Their fault, our fault, nobodies fault.... boat prices in America are falling through the bottom as fewer people can afford them.

That's our problem, and I don't hear politicians from either party stepping forward with solutions. Instead I'm hearing about who ate dog meat in the 6th grade.

As has already been pointed out in this thread, In the past, when we hit a wall, we moved on to the next economy expander and always prospered. This time around I'm hearing dead silence about the path forward.

[Therapy]

Originally Posted by David_Old_Jersey

But recently he read Mein Kampf! (I've not) - what he found most disturbing was not all the anti-Jewish stuff (substitute the modern day "Banker" and would be a lot more palatable for most).......but that he agreed with so much!
We live in interesting times - what would "you" rather do, spend 50 years paying off the debts of spivs on money that was effectively stolen from you - or 10 years of upheaval and tight times, at the price of a (relatively) few people swinging from lampposts (or the legal equivalent. or not ).

Hopefully our "lords and masters" will get scared of what could be coming down the pipe and act accordingly - before it actually does. But as a student of human nature I rather suspect not......

........Still, I once won a fancy dress competition dressed as Adolf Hitler!, so I reckon a fair chance that I will be ok .




.

Yep.

Interesting how circumstances can change some viewers views.

[youmeandthed]

Sell everything you got, buy the best equipt boat (it doesn't have to be the biggest), sail the western Caribbean to Panama, and you can save money on costs of living. You probably wont want to go back to reality, I don't.

[TomandAnitas34]

Thanks guys. I knew I could count on you and you've come through again ! The trend is as I thought, a slow spiral down. I was interested to see if I'd over looked some key information that might change the curve I suspect is in progress. I have been to some of the web sites that Cheech and Tropic have been to and I've read the same data. Viribus can be forgiven his perspective. After all, he lives in the only place in the US that is really jumpin'. He might have some different thoughts if he lived in western Illinois or Las Vegas. I tend to avoid apocalyptic interpretations of the future. It is clear at this point there are some generalizations that could be considered fairly bulletproof:
The best deal on a boat is one 15 to 25 years old that has been kept totally current in it's equipment.
Unless you sink hopeless amounts of cash into this boat, it will be worth about 30% to 50% of what you bought it for, when you are on the selling side of the negotiation table six to 8 years from now.
The market will gradually get worse, and generally the quality of the boats in the market will also gradually get worse, as it becomes more expensive to keep them up and the cost/benefit ratio drops.
The boat market generally tracks the housing market, and that's none too healthy right now and no improvement is expected any time soon.
So there you have it. I think I'm much better prepared for my next purchase. The next thing to wrap my mind around is the " right place at the right time ", scenario.

[avb3]

Just a reminder that political discussions, unless it directly pertains to boating, is not allowed on this forum. We are getting a bit close with stepping over that fine line where it drifts into general policital commentary. Some posts have been removed.

[Sailorman375]

PLEASE. I come here to get away from the endless political discussions on other sites. Let's stay with boating.