$$$ the economy thread $$$

jdm-rhd

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i think we need a thread discussing the economy. there are so many variables and they affect us all whether its here in the usa or globally.

being the op, i want to allow and feel it's ok to discuss politics, but please be respectful and no name calling or personal attacks. thank you

ive quoted a few other members remarks here from other threads that i feel will help get things started...


If we end up in a recession and people default their existing loans these dealership pigs will get slaughtered as they well deserve


They're out. They sold the car.

It's the bank's risk...

You'll have some people try to buy another cheaper car and let the current one go back. At the Credit Union, we rarely did a second ride for someone who had an open car and individual accounts.


We've been in a recession for months and it will only get worse. Massive layoffs in America is happening already


Hmm I'm in IT and people still reaching out for hiring. Maybe it will all fall apart at some point. Not sure we're in a recession though. Whatever else is going on, there are a lot of people throwing money around at vehicles. Maybe there are two economies, and two tiers of society.


I'm in Finance. Even though we are not in recession "official" yet, but it remains a real risk as the inflation remains too high, negative GDP, Feds raising interest rates, the stock market is s***, half of US companies are gearing up for layoffs. Look at Ford, they just laid off 3,000. Tech companies are taking a hit too.


The criteria for a recession seems to have slightly changed. We are not exhibiting all the classic symptoms of a recession as has happened in the past.

Low unemployment, job creation, and falling utility and fuel prices are not normally seen in a traditional recession.

I see the current dangers are supply chain issues due to existing COVID protocols in manufacturing and supplier countries, pent-up buying by higher income households in first-tier economies, and the resulting inflation caused by the first two issues.

This has all been caused by a once in a century health emergency in which we were not prepared and was mismanaged from the beginning.

It's going to be a tough couple of years for the average consumer.

Auto companies are transitioning to an EV world. Ford's recent layoffs are a result of the transition.
 

ZDreamer

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We're in a weird stage of the economy, specifically in the used and new car sales. There's not enough new cars on the lot to make the used car sales competitive (or low), bc every sold new cars are pre-ordered. Our gov't want to make this stage of our economy as a transition phase, and I believe they and car makers are FORCING the transition toward EV. Just like how Tesla became popular, partly because the sales pitch were "green vehicle to save planet" and "govt rebates", other car makers gonna find this tragedy as an opportunity to turn it into profit$$.

Now all car makers have seen Tesla normalizing EV cars, proven its reliable technology, it encourages all car makers to head that direction FAST and FORCEFUL!!!
 

Houston.RZ34

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I'm speaking form the vantage point of someone in Houston, TX.
- One of the hottest cities in North America to move to (blazing real estate market)
- Cars are a necessity here, we're a massive city area wise and public transportation will never catch up
- Most folks here have a bit of money because of the vast amount of opportunity here, Houston is a "Rich" city


With that said, I see the bubble starting to give out with it fully popping after the holidays.
- Cost of goods are visibly creeping up (materials, groceries)
- Cars are coming back down
- Houses are sitting 30+ days now (and this is during the start of the school year!!)

I do feel Covid has furthered the income gap in America.....as cliche as it sounds we're losing the middle class and we're turning into the "Haves and Have-Nots" like many other nations on the planet....I think ownership is becoming a pipe dream for most.
 
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jdm-rhd

jdm-rhd

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Let's not even bring up the rental housing situation...🙁
ive never rented...always bought/owned my home so i do not know about that...
 

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Housing market have slowed, demand's been dropping - Denver, Salt Lake City, Boise, Houston, Dallas, L.A., SF - other cities to follow. The economy is slowing, many will be upside down on loans and mortgages. By mid next year I'd bet you can get most cars below MSRP, including the Z if production volume has ramped up by then. Supply and demand drives all this. I can wait.
 

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Recession is coming next year. 70% economists now agree.

"What’s more, many economists say the United States will fall into a recession next year, according to a recent poll by the Financial Times and the University of Chicago’s Booth School of Business. Indeed, 70% of the 49 economists polled said they thought we’d declare a recession in 2023."

source: https://www.marketwatch.com/picks/7...proach-investing-in-light-of-that-01655243151
 

bboypuertoroc

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ive never rented...always bought/owned my home so i do not know about that...
Rental prices are higher than monthly mortgages, and steadily increasing. A lot of people are scared when they've never had a mortgage. I know I was, and that fucked me out of a house in Hawaii. Once I bought my first home I never looked back.
 

Houston.RZ34

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Housing market have slowed, demand's been dropping - Denver, Salt Lake City, Boise, Houston, Dallas, L.A., SF - other cities to follow. The economy is slowing, many will be upside down on loans and mortgages. By mid next year I'd bet you can get most cars below MSRP, including the Z if production volume has ramped up by then. Supply and demand drives all this. I can wait.
Speaking the gospel.....and I'm not even religious lol
 
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jdm-rhd

jdm-rhd

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Donalex

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Oh, boo hoo...

Net Sales: $3.99 billion vs. $3.9 billion

Adjusted EBIT: $202 million vs. $214.5 million

Diluted EPS: $0.81 vs. $0.80


Full-Year Outlook: Sales +5% to +7% (previous: +6% to +8%); EPS $2.30 to $2.60 (previous: $3.20 to $3.50)

The softening trend was more significant in customer segments with the lowest income profile," Nordstrom CEO Erik Nordstrom stated on the company's earnings call.

"While we saw greater resilience in the higher-income segments — for example, at the Nordstrom banner, items with lower AURs [average unit retail prices] underperformed — higher AURs within our designer business and higher-price luxury projects significantly outperformed lower-priced product."

The rich are getting richer, the poor, poorer...
 

NecioVato

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I think someone on this thread also discussed this. But if you look at the used car market - the loan to value that was borrowed against was so high that we are seeing Repos start to occur. Once those repos hit the auction and then the auction prices start to go down bc of the supply - then we will start to see the used market come down significantly which will then affect new car sales - since cars in the used market will be ‘affordable’ again.
What I find interesting is that car vloggers were the once touting this originally such as Your Auto Advocate along with Lucky Lopez. that has now trickled into the finance vloggers such as Graham Stefan, Andre Jirkh and Whiteboard Finance. Anyway - my point is if people will wait - the prices will start to come down - bc for those that feel that cars are an investment - well I have some NFTs to sell you haha.
It will be interesting to see how this all plays out with the govt and the banks - will there be another bailout paid out by the middle class like we have seen in the past or will things just get ugly. Get your popcorn ready (hate being the doom and gloom guy - but dang - I just don’t see how our current economy continues to go with such high inflation and raising of interest rates not affecting things)
 
 





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