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

[Ex-Calif]

I visit the US 4 times a year which affords me a "snapshot" of my perceptions of how things are. 2009-2010 were aweful. 2011 and 2012 I saw more new cars on the road and more vitality is apparent.

The malls are full everywhere I go. Unemployment is over 10 percent in only 3 states including Nevada, Rhode Island and California. The obverse is that more than 90% of the people are working. I wont comment on the quality of the jobs as that is subject to debate.

I think there is a lot more conservatism in individuals and a tight credit market. Unfortunately the medicine is severe but reduced dependency on credit is a good thing. The US is doing way better than many parts of Europe.

It is a real phenomena that Americans a consuming less. This has given much of the world a headache and has forced comanpies to continue to attempt to create a larger consumer class in the emerging markets in China and the rest of Asia which is still growing at a healthy clip.

If you weathered the crisis and have disposable income you have the opportunity to get into real estate and boat markets at a discount. To put it another way, America is on sale but if your cdit card is maxed out you may mot be able to take advantage.

[sww914]

I don't imagine the boat market will rebound to where it was until there is another gross excess of cash around. Point- the very very high end of the boat market is doing fine because the very very wealthy still have cash to spend. The rest will have to wait until something changes.
If you're handy enough and work hard enough, I think you can beat the game, as long as you can beat it with your own fists. I bought my boat for about 20 percent of it's former value and there are still others for sale at around that mark. I put an equal amount into it again ( that would have been twice as much if we didn't scrounge so well) and I've been offered about 200 percent of what I have in it. Keep in min that we bought good used at every opportunity and waited for a sale on the rest, but most people could do the same as us.

[tomfl]

Originally Posted by Ex-Calif

SNIP
Unemployment is over 10 percent in only 3 states including Nevada, Rhode Island and California. The obverse is that more than 90% of the people are working. I wont comment on the quality of the jobs as that is subject to debate.

SNIP

If you weathered the crisis and have disposable income you have the opportunity to get into real estate and boat markets at a discount. To put it another way, America is on sale but if your cdit card is maxed out you may mot be able to take advantage.

I have to disagree with your take on the unemployment rate. While it is true the U3 has been going down that is not the whole story. U6 which most economists think is a better measure is over 10% nation wide. Even that 10% figure is misleading because the labor participation rate is at historic lows. The labor participation rate is the portion of the population that is in the labor force and has gone from around 65% in 2001 to under 62% currently, lower than it has been since the 1960s when women started entering the work force in numbers.

In absolute numbers there are around six million fewer people working now than in 2008, and this does not take into account the loss of jobs in the underground economy, which is economist speak describing things like illegal aliens working off the books who are leaving the construction industry.

Job creation has been mostly between 100,000 to 150,000 per month since 2008, and it needs to be around 200,000 just to keep up with population growth.

Your point about the quality of the jobs being created is well taken.

You also have a different view of the real estate market than I do. True prices have been dropping since 2006, but there is still a glut. It will take additional price decreases to reach a market clearing price. The result is that banks are reluctant to loan money. Combined with massive unfunded liabilities (Medicare, Medicaid, Social Security, and interest on the debt will consume the entire federal budget in a few short years leaving no money for anything else) there is a real chance of a lost generation similar to what happened to Japan. At some point the federal government will have to stop borrowing 40% of every dollar it spends from China.

I would love to think this analysis is wrong, but unfortunately I can't.

[Ex-Calif]

Originally Posted by tomfl

I have to disagree with your take on the unemployment rate. While it is true the U3 has been going down that is not the whole story. U6 which most economists think is a better measure is over 10% nation wide. Even that 10% figure is misleading because the labor participation rate is at historic lows. The labor participation rate is the portion of the population that is in the labor force and has gone from around 65% in 2001 to under 62% currently, lower than it has been since the 1960s when women started entering the work force in numbers.

In absolute numbers there are around six million fewer people working now than in 2008, and this does not take into account the loss of jobs in the underground economy, which is economist speak describing things like illegal aliens working off the books who are leaving the construction industry.

Job creation has been mostly between 100,000 to 150,000 per month since 2008, and it needs to be around 200,000 just to keep up with population growth.

Your point about the quality of the jobs being created is well taken.

You also have a different view of the real estate market than I do. True prices have been dropping since 2006, but there is still a glut. It will take additional price decreases to reach a market clearing price. The result is that banks are reluctant to loan money. Combined with massive unfunded liabilities (Medicare, Medicaid, Social Security, and interest on the debt will consume the entire federal budget in a few short years leaving no money for anything else) there is a real chance of a lost generation similar to what happened to Japan. At some point the federal government will have to stop borrowing 40% of every dollar it spends from China.

I would love to think this analysis is wrong, but unfortunately I can't.

I wont argue. The fact is no one really knows what happens or is happening. My college economist taught me that.

So today JPMorgan announces $2b in bad derivative debt.

What does anyone know...

[Tropic Cat]

Originally Posted by Ex-Calif

I wont argue. The fact is no one really knows what happens or is happening. My college economist taught me that.

So today JPMorgan announces $2b in bad derivative debt.

What does anyone know...

$2Billion? Hmm..that's what Jamie Diamond couldn't hide from his board. It's probably higher.

As to Unemployment numbers. U6 is closer to 15%. U3 was invented by President Clinton in 1994 and does nothing but hand MSM misinformation for the public's consumption. In fact, all administrations play with these numbers and I no longer believe any economic numbers coming out of Washington.

As to the Recession...None of the underlying causes of the Financial meltdown have been addressed and real wages are still decreasing ... hell, as you pointed out, JP Morgan is still playing with derivatives. Look how well that's working for them. Some CEOs just never learn, and why should they when they can figure a way for the American People to cover their mistakes.

Housing is still a disaster and is at historic lows. No matter where you look, there is simply no way the unemployment situation is improving, nor can it improve. You can't ship 22 million jobs overseas, gut the middle class and expect everything to go along like it did. No matter where you got your MBA from, the answer is the same ... It just won't.

The guys at Shadowstats.com have what I feel is a much better handle on the American economy. Here's their chart on unemployment.



As for fixing the American economy?...I would adopt a "do unto others as they do to me" trade philosophy. I'll bet that would fix our auto export numbers to China, Korea and Japan real fast while putting millions of Americans back to work.

[Ex-Calif]

To be fair the Japanese have tried. There are a crapload of Japanese cars assembled in the US. A Japanese auto worker could be justified in saying, "they lost the car wars in the 70s and 80s so screw 'em. Keep those jobs here."

The Chinese not so much. We are addicted to low cost products.

The average American worker enjoys a pretty high standard of living. The average Chinese or Japanese blue collar worker probably lives in less than 1000 square feet and very few own boats or other leisure items.

Just saying.

We lost the national will to focus on exports. Why not? We had best access to the largest consumer class in the world with strong growth and easy credit. It's been a long time coming and there may be no road back.

[Doodles]

Originally Posted by Ex-Calif

To be fair the Japanese have tried. There are a crapload of Japanese cars assembled in the US. A Japanese auto worker could be justified in saying, "they lost the car wars in the 70s and 80s so screw 'em. Keep those jobs here."

The Chinese not so much. We are addicted to low cost products.

The average American worker enjoys a pretty high standard of living. The average Chinese or Japanese blue collar worker probably lives in less than 1000 square feet and very few own boats or other leisure items.

Just saying.

We lost the national will to focus on exports. Why not? We had best access to the largest consumer class in the world with strong growth and easy credit. It's been a long time coming and there may be no road back.

That last sentence is basically the bottom line. Everyone knows by now I think that the car industry in the US will never be what it was nor should it. Heavy industry is for the developing world where labor rates are lower. And hopefully we have learned that trade wars like military wars are to be avoided in a global world that's not going away. Just to give you an example, here in Thailand the government just raised the minimum wage to 300 Baht a day or about $10, and light industries are already moving out to cheaper pastures like Burma and the Philippines.

[David_Old_Jersey]

Originally Posted by Cheechako

As things decline the nazis and other wierdos will gain traction.

Me father is nigh on 80, was a school kid during WWII - went over to England for the duration (to Birmingham - an industrial city, well it was back then!) so he got bombed a lot. Accordingly spent most of his life not very keen on the Germans! Throw in that his father (who stayed in Jersey - by accident ) got deported to Germany ("Resistance against the 3rd Reich" - in practice that covered a few sins, mostly involving "liberating" petrol and the import and export trade, via his stint in the local end of the German Merchant Navy - not exactly a volunteer, but not exactly forced labour - more a business opportunity ). So, as I said, Father not too keen on Jerry .

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! Possibly not enough to have voted for Hitler. Possibly not . But could see why people had (especially as he did come from a time of many folks having SFA - with the prospect of even less ).

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 .

It's a perfect breeding ground for radical Islam too.... which is the fastest growing religion out there...

Well, if push comes to shove - I already have a beard, and I can chant Woo with the best of 'em when needed (a Catholic Education). But given that Islam by design won't ever let a society progress they won't ever be an economic force to be reckoned with - so militarily won't be a problem.

[Tropic Cat]

[rognvald]

Originally Posted by Cheechako

"We're seeing this happening already. How many 20 -30 somethings own a boat in your marina today? As you pointed out, these are the future owners of our boats and there simply aren't enough of them."
"Lower SSCA member ship, etc"
Yep, we have been fortunate enough to live in a wonderful bubble of prosperity since WWII. My guess is that the near depression of 2008 is an adjustment starting a more rapid decline of properity here in the US. Heck, look at how much of the world lives, small cheap apartments or tin shacks. "...own a yacht? You're kidding!...." Add to that ...that fiberglass lasts too long.... and there are going to be boat hulks everywhere. At least in the old days the wooden boats would sit on the shore and rot....
As things decline the nazis and other wierdos will gain traction. It's a perfect breeding ground for radical Islam too.... which is the fastest growing religion out there... It's only a matter of time before we start seeing the suicide bombers here in the US instead of on the news... and they will likely be US citizens...

Wow.... I'm depressing today! sorry....

Well said. We Americans have been fortunate to live a lifestyle unparalleled in the history of the world. Our middle class has had a higher standard of living (income) than many upper class/professional persons elsewhere in the world. As our fiscal house continues to implode and the average American has to adjust to a new/lesser standard of living, the prospect of anarchy, political upheaval, riots and class warfare will increase and we will see the beginnings of a "Third World" societal shift in the U.S. For those who "live in the bubble" unaffected by the true disintegration of our country, the fall will even be greater as they have lulled themselves into the belief that even though others suffer, they will be unaffected. It is when these "protected classes" (civil servants, employees of multinational corporations, teachers, unions, government subsidized businesses, etc.) finally succumb is when you will see the true effect of this disintegration. How will this effect boating? As others have mentioned, take a look at the amount of boat owners in their 20's and 30's at your local marina and the answer is obvious. We Americans will have to adjust to a markedly lower standard of living unless we have the ability to once again be responsible and force our government to do as we do: live within our means.

[ViribusUnitis]

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

I can personally SEE the increase in productivity in the Western industry. I can see how technological improvements are making people's labor more productive. More productive than they even were in 2000. In some cases almost an order of magnitude more productive. Regardless of what the government says, I can SEE the improvements in technology at my work. I can see the progress that is being made in the stuff I have at home. It is unquestionable that there is steady progress.

All of that additional productivity is going to go somewhere. The greater the level of productivity, the more capital there is available for the next generation of improved factories and rebuilt plants. The global "factories" of the world have grown by LEAPS and BOUNDS. The industrial production of the US has actually INCREASED over the last 10 years. Europe is no different. The production in places like China had exploded allowing many many more items to be produced.

As the division of labor results in further and further specialization, productivity will continue to improve around the world. More production, and there are more goods to be split between us all. And higher quality goods as well.

That means that the US and Europe aren't going down in their life style, but Asia is coming up. There will be short term setbacks from people that acted on bad ideas, but the basic path is clear. And it's for an improved life for everyone on this planet.

In real terms, boats will get cheaper to buy. More people than ever will find themselves with the ability to afford getting a boat and sailing away. That might upset some of those that are already gone, but just because you were there first doesn't mean some of the rest of us can't join you.

How often did people in their 20s really ever own boats in marinas? Most people that I'm aware of had too many other bills to have a chance at a boat in a marina. Maybe a trailer sailor that they keep behind their house, but not a boat in a marina. When was this ever any different?

[rognvald]

Originally Posted by ViribusUnitis

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

I can personally SEE the increase in productivity in the Western industry. I can see how technological improvements are making people's labor more productive. More productive than they even were in 2000. In some cases almost an order of magnitude more productive. Regardless of what the government says, I can SEE the improvements in technology at my work. I can see the progress that is being made in the stuff I have at home. It is unquestionable that there is steady progress.

All of that additional productivity is going to go somewhere. The greater the level of productivity, the more capital there is available for the next generation of improved factories and rebuilt plants. The global "factories" of the world have grown by LEAPS and BOUNDS. The industrial production of the US has actually INCREASED over the last 10 years. Europe is no different. The production in places like China had exploded allowing many many more items to be produced.

As the division of labor results in further and further specialization, productivity will continue to improve around the world. More production, and there are more goods to be split between us all. And higher quality goods as well.

That means that the US and Europe aren't going down in their life style, but Asia is coming up. There will be short term setbacks from people that acted on bad ideas, but the basic path is clear. And it's for an improved life for everyone on this planet.

In real terms, boats will get cheaper to buy. More people than ever will find themselves with the ability to afford getting a boat and sailing away. That might upset some of those that are already gone, but just because you were there first doesn't mean some of the rest of us can't join you.

How often did people in their 20s really ever own boats in marinas? Most people that I'm aware of had too many other bills to have a chance at a boat in a marina. Maybe a trailer sailor that they keep behind their house, but not a boat in a marina. When was this ever any different?

Are you interested in real estate? I have a bridge to sell in Brooklyn. Very good price!

[speakeasy]

ViribusUnitis, pass the kool-aid. I'd like to not see limits also. Greenspan touted the 'productivity miracle' all during the late 90's. How did that turn out? The American middle class got eviscerated and hasn't recovered. Fewer jobs for many more people means lower wages, lower taxes raised, lower housing prices, crumbling infrastructure, etc.

The current system of finance that relies on perpetual growth will have to be razed as we reach the limits of growth on this planet, due to population and finite resources being used up. Maybe your god technology can find us a nice new planet with resources as yet unexploited and we can fly off like locusts to the new world.

[Tropic Cat]

Originally Posted by ViribusUnitis

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

I can personally SEE the increase in productivity in the Western industry. I can see how technological improvements are making people's labor more productive. More productive than they even were in 2000. In some cases almost an order of magnitude more productive. Regardless of what the government says, I can SEE the improvements in technology at my work. I can see the progress that is being made in the stuff I have at home. It is unquestionable that there is steady progress.

All of that additional productivity is going to go somewhere.

I agree with you, it is going somewhere. It's going to India and China where it's being used to create a middle class. It's measured in trade deficits and balance of payment disparities both of which are now in the $Trillions. The reason the previous post was all gloom and doom is that we can't pay for all the stuff that's in those Chinese shipping containers. Not this year, or last year or in any year since the Nixon Administration. Instead, we get new loans from China, who have historically been more than happy to loan us the money to buy their products. These days? China already holds $1.5 Trillion of American debt and really doesn't want any more of it.

Now I can tell you're a focused kind of guy..ask yourself

1.) how big a hammer does China have in holding $1.5 Trillion of our debt. (some suggest that they get to pick our president)
2.) what happens next?

I realize this is an incomplete post, but have to stop here.

[ViribusUnitis]

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

Yes, China and India are building a new middle class. I don't begrudge them that. I wouldn't want to live in squalor either, and their can be no question that they are earning every cent to takes to build it all. I don't know how ANYONE can begrudge them that. I certainly don't. Wages in China and India are rising rapidly by all accounts. How can anyone feel bitter about their success?

As far as finite resources, it makes sense, but it seems like every time we're about to run out of one irreplaceable resource or another, we find an alternative, or an alternate supplier. As far as I can tell, there are no known limits to how far this can be pushed. The more highly educated people there are in the world, the farther the limits can be pushed. Education is expensive, so the more productive the world is, the better for us all.

If the US has problems, they are it's own fault. It's up to the people of the US to make it right, or leave to where it is right. The technology is improving, so the potential is there. The only question is are Americans as willing to work hard and save so the country can be improved? That's a matter of character, and I simply choose to believe that people want the world to be better, and are willing to do what it takes to make it happen. I know I do, and I know I am. The rest of you? That's up to you.