Prices not going down??

[Hardhead]

Once the full economic impact is felt, and people are tight on money and high on insecurity - used boat demand will likely fall, and the prices will then fall. I'd check back in 4-6 months...

[Larry Florida]

Originally Posted by Wotname

Curious - exactly which dollar are you referring to?
Last time I checked, there were more than 20 to choose from.

"The $ dollar" as stated can be only one

[Cheechako]

Originally Posted by Mike OReilly

Patience buddy, patience. The sky has only just started to fall. Gotta give people time to adjust.

yep Especially if you are buying a boat. The going out of business sales will be starting soon...

[henryv]

Things may start getting back to normal a little sooner as there are a couple serious treatment trials underway that have the potential to seriously limit the effects of the disease. A French doctor already completed a trial using a combination of the anti malaria drug with an antibiotic. The patients receiving the drugs recovered quickly. The same drug combination has just been started in a trial in New York. They are also having success using a serum taken from people who have recovered and who are now resistant.
Once there is light at the end of the tunnel people with start thinking more positively again.

[capn_billl]

I fully expect the economy to rebound, but the loss of nearly a month of economic activity will be hard felt.

Several big projects at my company were cancelled.

Restaurants all over the country are going to lose a months income.

I lost a months income.

if things go back to normal in a couple weeks, it will take a year to recover. no matter how you slice it, we just lost 10% of the growth of this year.

[Lake-Effect]

Originally Posted by Island Time O25

If my income gets cut by 30% it only makes sense that my loan rate should also be cut by 30% and in turn I can price my services or products 30% lower, etc, etc. This way the market will quickly find equilibrium and realtive prices/costs will adjust to the actual demand and supply. And not stay artificially rigid. It's that rigidity in one sector or another which necessitates layoffs and makes for recessions/depression.

I bet you if the empolyers could easily cut wages 30% they would have less need/incentives for layoffs. And IMO anyone is better off getting 70% of his former wages than 0%. In the long run unemployment insurance and minimum wage schemes make for bad economics. But of course help politicians to get elected.

Doesn't work like that, though, does it? We all don't feel the economic impact equally. As a business owner, you have assets and savings, you are not going to be impacted in the same way as your most junior employee, who may be 2 paydays away from homelessness. Like most investors, you were already a bit defensive in your holdings, so your actual investment loss wasn't anywhere near 30%, was it?

Notice how many jobs only pay the minimum wage? If you could drop wages 30% any time, you would, right? So let's say that it's allowed... when would you jack the wages back up? I'm guessing never. Unless the market or the government forced you to.

I would also guess that if the government offers a payout for business owners, you'll sign on for it, regardless if you actually need it or not. (duh, who wouldn't?)

So it's much more complex than just applying the same percentage changes across the board.

At this moment, I'm still optimistic that the lockdown won't be too long, and that economic recovery will be strong... IF the bulk of stimulus is given to workers and small businesses like yours. This puts money into the hands of people who were most hurt, and who are most likely to spend it on goods and services, which will juice everything. If a significant amount of money is given to big corporations, they will simply bank it, while hanging on to all the savings they've achieved through layoffs and cutbacks.And the economy would remain as fragile and bubble-driven as before.

[smj]

Originally Posted by capn_billl

I fully expect the economy to rebound, but the loss of nearly a month of economic activity will be hard felt.

Several big projects at my company were cancelled.

Restaurants all over the country are going to lose a months income.

I lost a months income.

if things go back to normal in a couple weeks, it will take a year to recover. no matter how you slice it, we just lost 10% of the growth of this year.

Things will be much worse in a couple of weeks and will probably be months before maybe stabilizing.

[cuthbert]

Originally Posted by Chotu

2 days after I put all the listings up, I had around 16-18 fairly serious people.

Then quarantine hit and people got scared to make a move. Every single one said they are now waiting to buy anything and are out of the market.

However, I'm not going down from my already very good price. I'm just taking the boat out to quarantine on while the panic is going on. I'll come back after an enjoyable summer.

I think this is pretty much the way to tackle this or anything similar such as 401K etc. Sit tight if you can and wait for everyone to calm down/stop watching the 24 hour news.

Last recession I noticed maybe 1% or less of newish or good condition sailboats going for a song, but in the most part boats are owned by people who are rewarding their own labor and not 'living the daydream" and they paid and subsequently sell at fair market value. It is of course possible that the draconian response to a virus that may kill at most 1% of the population could collapse the whole economy and fair market value will be a different lower number. But I doubt this, as those seriously at higher risk (very old/underlying conditions) may self isolate to a painful degree to ensure survival but the rest will only tolerate a reasonable amount of infringement on personal choice for the perception of a greater good.

On a separate note with so many in the same boat (so to speak) would any care to speculate on investment strategies? After getting 80% out in 2018, I started this weekend with 5% of my discretionary (not needed for now to 2024) cash into the stock market and intend to do this 19 more times at weekly intervals, so by autumn I will have as much stock market exposure as I would care to have at any time. The experts are saying don't buy yet, but the same experts were saying as little as two months back don't sell and instead buy more.
Comments?

[robert sailor]

The human being is an interesting animal. When faced with situations that no one has the answer for someone will make up a story and if promoted the masses will start believing it. We just can't accept that there are certain things we just don't know..That might help explain why there are over 4000 religions in the world.
So, no one knows when this virus issue will be over nor does anyone know how it will effect the economy ...no answer available, period!! There are stories we tell ourselves to make us feel better...carry on.

[joelhemington]

Originally Posted by geoleo

Dear Sailors, The $ dollar is supposed to be "KING" stocks have collasped, interest rates at all time lows, gold is down, the dollar is up UP on all currencies worldwide , the euro is headed for par with the dollar, the pound is way down too, oil is down 53% in 2 weeks. Yet marine stuff is same old high price. Defenders big sale is pathetic usually offering around 10-15% off a fake list price. Used sailboats are still way up there too and asking prices are the same. Why is this ? Is every seller hoping beyond hope OR is their business still doing great with old prices?

If there's a boat you've got your eye on. sit tight for awhile as nobody can get anywhere right now, it'll still be there if and when this crisis abates and maybe the owner will be more desperate by then.

[letsgetsailing3]

Originally Posted by Island Time O25

At least we know know that TP hoarders are full of you know what.

Well, it was going to come out eventually.

[roverhi]

[QUOTE=joelhemington;3100060]If there's a boat you've got your eye on. sit tight for awhile as nobody can get anywhere right now, it'll still be there if and when this crisis abates and maybe the owner will be more desperate by then.[/QU.

Had my eye on a boat after the last recession. It had been on the market for more than a year when I finally decided it was the boat I wanted. Did a sail and wasn't disappointed. Made the seller a low offer but he wouldn't take less than his price which was essentially the cost of a brand new set of sails he'd bought. Was going on vacation so put off making a more serious offer till we got back. Called him when we got back and he'd accepted an offer which was less than what I would have paid for the boat. I'm still kicking myself for trying to be cute and not make a reasonable offer at the start.

From my experience in Real Estate in Kona bargains will come early but few with those that are grossly over extended. Unfortunately very few of these have any equity and end up going through a long drawn out foreclose process in which they usually get trashed so are only a deal if you can fix them up yourself. Very very few of the desperate owners have much equity in the property so they are able to sell them cheap. Most of the owners will hang onto them for several years hoping someone will bail them out. 2-4 years in, deals will start showing up from owners who finally accept reality. The weird thing about this is that's just before the time the market begins to turn up. If this recession is to be an extended one, you will probably have to wait a long time before you will be able to find a deal.

[blubaju]

One day you will sell your boat, will you ask the same question? There are fair traders and ghouls.

[Hardhead]

Originally Posted by roverhi

.....Had my eye on a boat after the last recession. It had been on the market for more than a year when I finally decided it was the boat I wanted. Did a sail and wasn't disappointed. Made the seller a low offer but he wouldn't take less than his price which was essentially the cost of a brand new set of sails he'd bought. Was going on vacation so put off making a more serious offer till we got back. Called him when we got back and he'd accepted an offer which was less than what I would have paid for the boat. I'm still kicking myself for trying to be cute and not make a reasonable offer at the start.

That's frequently been my experience as well... Something can sit on the market for years - and as soon as I see it, 3 other people apparently saw it the day before, and put in a bid on the day I discover it..

[CarinaPDX]

The US is at the end of one of the longest periods of expansion ever, and we were set for a contraction no matter what. Covid-19 was a pretty harsh trigger and caused a sharp drop, but a contraction was coming. I see no reason to believe that after such a large negative impact the economy would rebound quickly. Of course there are many unknowns, such as how long the response to the outbreak will last, but early recovery seems unlikely. Just the loss of all of the wealth as (some) consumption continues while income and output is dropped, as well as the market losses, argues for a lower level of activity for some time after the immediate health crisis ends. And all of this money the government is set to give away is not raining down from above: we, collectively, are borrowing now to get through it and will be paying off this debt for a long time - either through capital and interest payments or inflation. This is going to be a large damper on growth. I admit, I am a fan of the Dismal Science...

As for the boat market, the first thing to know is that it is very opaque by intent. Asking prices are being held very high by the brokers, and of course the unwillingness to accept the real cost of owning a boat by the sellers (a boat is an expenditure, not an investment) means reluctance to accept the real market value. The market never recovered from the 2007/8 crash. There are very few buyers relative to sellers, in part because banks won't loan to buy older boats and so only people with cash can buy. The current crisis will likely reduce that number even more. I recently asked a local broker how long it took to sell a cruising boat and he said it was about a year (during which the owner pays for slip and insurance). From what little I have seen many of them go for a lot less than asking (by talking to either buyer or seller - brokers keep that info close), although that is not across the board. OTOH a friend with a nice Cascade 42 set a reasonable price (i.e. historically low) and had at least two cash buyers appear quickly. The lesson for a seller is to accept the loss of value and price to market, not desire. For a buyer, know that cash is king and the best way to discover the market value is to make firm offers. Both should know that the brokerages' asking prices are often inflated, sometimes by a lot, and they are often very resistant to cutting the public asking price - after all it costs them very little to wait for a better price, it is the owner that bleeds money. If I were selling I would do it myself and price reasonably (but given that I built her, I am more interested in getting the right buyer than making money - not a lot in her anymore no matter how special she is). As a buyer I would pretty much ignore asking prices and just make firm cash offers according to my judgement, to private or brokerage listings.

Greg