Prices coming down?

[Heath68]

I am not sure the motorhome and boat markets are the same. A lot of what is being discounted are charter yachts.. i dont know but i dont imagine lots if people buy a motorhome then let it out to a motorhome holiday company for 4 years to eventually pay it off and use it.. i imagine its a different financial industry completely.??

[tomfl]

Originally Posted by Heath68

I am not sure the motorhome and boat markets are the same. A lot of what is being discounted are charter yachts.. i dont know but i dont imagine lots if people buy a motorhome then let it out to a motorhome holiday company for 4 years to eventually pay it off and use it.. i imagine its a different financial industry completely.??

It would be interesting to see how many charter boats there are compared to the total number of boats. I can remember when a couple of hurricanes destroyed a huge number of boats, both charter and non charter. There was a shortage of boats available for charter and boat makers were backlogged.

There is also the consideration that ex charter boats are widely viewed as not worth as much as the users version of the same boat and they have always sold at a discount. The real question is how many ex charter boats will be on the market and are there enough to affect the price point of other boats.

[Barra]

Yep its duelling forces money printing vs economic contraction. The financial markets have completely separated from the real economy as a result and most of us can't even get our heads around how much money has just been created.

Too soon to be sure which force will win out I reckon but I will say this - in terms of the amount of gold needed to buy your dream boat that will definitely be cheaper no matter which of the 2 duelling forces wins out.

Originally Posted by Palarran

I doubt you will see a change in the market. The US government alone just pumped $10 TRILLION (counting FED) into the economy. Add to that what the rest of the world printed and it becomes an astronomical amount of free cash. There's so much money floating around it's crazy. That's why the S&P is trading at 20x future earnings. What are your options? Zero interest rates, no safe havens including muni's and bonds that make any $. So if you have it, and so many do, you might as well buy something and RV's and boats make perfect sense right now.

We are playing the game "musical chairs" where everyone is dancing around in a circle, the music never stops, and no one has noticed that all the chairs have been removed.

Anyway, just look at all the posters here. I doubt you will find one that will say they have been seriously negatively affected financially. Contrast that to 2008 where I didn't know anyone who wasn't affected.

[arsenelupiga]

Originally Posted by Barra

Yep its duelling forces money printing vs economic contraction. The financial markets have completely separated from the real economy as a result and most of us can't even get our heads around how much money has just been created.

Too soon to be sure which force will win out I reckon but I will say this - in terms of the amount of gold needed to buy your dream boat that will definitely be cheaper no matter which of the 2 duelling forces wins out.

you talk like you invested in gold. I have some too. However one should remember that boat prices are not in bubble, compared to say property, there goes large intellectual input and precise work in boat manufacturing, way more than equivalent property. Property is way up due to marketing blessed by governments and central banks. Very few know when this will stop, but it always has in history and will this time as well.

Depends how virus story goes, boat has actually pretty good use in some bad scenarios of this crisis. Say one can easily erase debt by selling property and buy boat and is left with cash. So in some really bad scenarios (say 20 % chance happening) boat prices may not do worse than gold.

[Palarran]

Originally Posted by Barra

in terms of the amount of gold needed to buy your dream boat that will definitely be cheaper no matter which of the 2 duelling forces wins out.

I think I agree? You either have way more "gold" (money), or the economy crashes and the boats are cheaper. Could add in hyper-stagflation to the mix where the economy contracts and prices rise - very quickly.

Personally I'm amazed at what a new 44' catamaran costs. Crazy money for plastic, aluminum, and a bit of steel.

[tomfl]

Originally Posted by Palarran

SNIP

Personally I'm amazed at what a new 44' catamaran costs. Crazy money for plastic, aluminum, and a bit of steel.

So buy some plastic, aluminum, and a bit of steel.

[Heath68]

Originally Posted by Palarran

I think I agree? You either have way more "gold" (money), or the economy crashes and the boats are cheaper. Could add in hyper-stagflation to the mix where the economy contracts and prices rise - very quickly.

Personally I'm amazed at what a new 44' catamaran costs. Crazy money for plastic, aluminum, and a bit of steel.

I think there must be a 50% profit margin.. i would imagine cashflow would be a boat maker killer far more than profit.

[Palarran]

Originally Posted by tomfl

So buy some plastic, aluminum, and a bit of steel.

Are you really banging your head over that comment? Do you bang your head often? I'm guessing yes because obviously I have some plastic, aluminum, and a bit of steel already but just thought the new stuff is selling at ridiculous prices. Maybe take an aspirin.

[tomfl]

Originally Posted by Palarran

Are you really banging your head over that comment? Do you bang your head often? I'm guessing yes because obviously I have some plastic, aluminum, and a bit of steel already but just thought the new stuff is selling at ridiculous prices. Maybe take an aspirin.

Yea I am really banging my head over someone ignorant enough to think any boat is just plastic, aluminum, and a bit of steel.

First off someone has to design a boat and I would bet if you tried to design a boat it would be a pile of bull spit. A first rate naval architect commands big bucks.

Next is a lot of pre production work, things like a place to build the boat, molds, and often specialized machinery; and this is just for the hulls and cross members.

Your ignorance of what it takes to come up with a mast, standing rigging, running rigging, winches, traveler, and associated parts is shocking.

And we have not even gotten into sails themselves. I doubt you have any ability to sew sails and even a cheap set of low quality sails would run into thousands of dollars. Not to mention you completely ignored sails in you silly comment that a boat is only 'plastic, aluminum and a bit of steel'.

There are plenty of threads about how DIY builders are basically working for pennies an hour and you seem to completely ignore the labor costs.

Truth be told if there was such a huge profit margin in building boats a lot more folks would be doing it; margins for companies building boats are tiny.

[Palarran]

Originally Posted by tomfl

Yea I am really banging my head over someone ignorant enough to think any boat is just plastic, aluminum, and a bit of steel.

Actually, Prozac would be a better prescription.

[Heath68]

Originally Posted by Palarran

I doubt you will see a change in the market. The US government alone just pumped $10 TRILLION (counting FED) into the economy. Add to that what the rest of the world printed and it becomes an astronomical amount of free cash. There's so much money floating around it's crazy. That's why the S&P is trading at 20x future earnings. What are your options? Zero interest rates, no safe havens including muni's and bonds that make any $. So if you have it, and so many do, you might as well buy something and RV's and boats make perfect sense right now.

We are playing the game "musical chairs" where everyone is dancing around in a circle, the music never stops, and no one has noticed that all the chairs have been removed.

Anyway, just look at all the posters here. I doubt you will find one that will say they have been seriously negatively affected financially. Contrast that to 2008 where I didn't know anyone who wasn't affected.

I will admit to not fully looking into this but i doubt VERY much the US simply printed the money. Doing so would cause MASSIVE inflation and prices of everything would rocket (this is what Germany did post WW1).
I am fairly sure they will have borrowed it (from countries like China and Saudi). This gives you money to spend but does not add to the money in the economy and so keeps the value of the dollar vs international currencies. The issue now though is that China etc own america (because they will want something back for the loan... and often that is agreements on immigration and property ownership in the US.. this is why when 911 happened, rich bin laden families were allowed to fly home). The US had no choice financially other than to let them otherwise the $trillions owed would have to be paid back).
Anyway my point is that is no New money (as far as i can see) just a lot more debt.

[daletournier]

You need to look into QE amongst other things, the fed is buying the debt with money they create out of thin air thus funding the treasury. So yes they are figuratively speaking printing money....trillions of it. Look into fractional banking to understand how currency is created.

China as well as many other countries have been reducing the amount of US debt they hold. I think Russia has sold approx 97% of the US treasuries they held.

[mvweebles]

Originally Posted by daletournier

You need to look into QE amongst other things, the fed is buying the debt with money they create out of thin air thus funding the treasury. So yes they are figuratively speaking printing money....trillions of it.

For those interested, here is a pretty good article on how the Fed operates and where the money comes from (spoiler alert: there's much more than printing of currency). As far as how COVID effects boat sales and personal recreational alternatives to vacation travel, the market is clear: RVs, camping, and boats are selling briskly, albeit turn-key versions versus fixer-uppers. $100k-$200k is the sweet-spot for larger assets. Maybe that changes in coming months ----- or maybe it doesn't.

https://www.cnbc.com/id/43752521

[Palarran]

Originally Posted by mvweebles

For those interested, here is a pretty good article on how the Fed operates and where the money comes from (spoiler alert: there's much more than printing of currency). As far as how COVID effects boat sales and personal recreational alternatives to vacation travel, the market is clear: RVs, camping, and boats are selling briskly, albeit turn-key versions versus fixer-uppers. $100k-$200k is the sweet-spot for larger assets. Maybe that changes in coming months ----- or maybe it doesn't.

https://www.cnbc.com/id/43752521

That's a good article. A scary one is to commit 2 hours of your life and watch Zeitgeist: The movie and it's addendum. I did many years ago which led to my opinion that money is pure illusion.

https://www.youtube.com/watch?v=EqjkWNsePoU

If you search "boat sales pandemic" there is no shortage of articles about the subject.

https://www.denisonyachtsales.com/20...-s-yacht-news/

[Barra]

Originally Posted by Heath68

I will admit to not fully looking into this but i doubt VERY much the US simply printed the money. Doing so would cause MASSIVE inflation and prices of everything would rocket (this is what Germany did post WW1).
I am fairly sure they will have borrowed it (from countries like China and Saudi). This gives you money to spend but does not add to the money in the economy and so keeps the value of the dollar vs international currencies. The issue now though is that China etc own america (because they will want something back for the loan... and often that is agreements on immigration and property ownership in the US.. this is why when 911 happened, rich bin laden families were allowed to fly home). The US had no choice financially other than to let them otherwise the $trillions owed would have to be paid back).
Anyway my point is that is no New money (as far as i can see) just a lot more debt.

Its an important consideration that while quite a few do understand what our central banks have been up to the "average joe in the street" is blissfully unaware still.

Qantitative easing, unconventional monetary policy, whatever you want to call it is money printing.

If they ever wake up to it then thats when the calamities you mention will really take off as trust is lost in paper money again (or this time around in numbers on a computer screen)

Dont mind the US though your own bank of england has been very busy in this space too - 1.4 trillion pounds in just the last few months. Most people simply cannot imagine what a trillion is. The mental picture I like is that 1 trillion dollar bills stacked up would reach 1/4 of the way to the moon.

Since this crisis global central banks have created enough paper money to go to the moon and 2/3 of the way back again. In just a few months.

If anyone doesnt think that has created a tremendous amount of potential inflation (including in boats) then they simply havnt stopped and thought it through enough.

ie boats may go up in $ value once things settle down even in a recession. But really what is happening is the $s used to pay for it are crashing in value.

By the way to boat owners that aint so pretty either- got 100k for the marina bill or even more extreme a small army to keep the revolution from seizing it?

Interesting times ahead. Ignorance is probably bliss