My Friend the Car Dealer Says...

[hom36rown]

those little equations are used by some of the most successful investors in the world. they are common practice in every business, from manufacturing, to investment banking. it's called PORTFOLIO ANALYSIS. they are made to ignore all other factors that one cannot control, because of that very same reason. every mathematical model ignores, or assumes as constant, factors that cannot be calculated or accurately estimated. uncontrolled factors such as so many people were going to buy cars anyway, is a baseless assertion, and anyways is not the focus of the time value money analysis i completed.

Your little equation is ridiculous on so many levels.

it is not the government's fault that domestic auto makers were making cars that americans don't want to buy anymore. how many times do we need to go through this. THEY WERE MANAGING THEMSELVES INTO THE GROUND. if you cannot see the mentality of these CEO's and what not: they each flew a different private jet into the capital to ask the government for money because they were broke. maybe if they were more focused on the market, and on american consumer trends instead of living the good life in lala land they would be doing as good as foreign automakers....

I agree. What's your point?

"and now people will be less motivated to buy a car without some sort of handout on the table" actually, people are less motivated to buy a car because we are in a recession. everyone is wary that they might be the next one laid off.

As they should be.

to blame poor car sales on the government not giving a handout is good old fashioned bullshit.

I didn't blame poor car sales on the lack of handouts. I just said some people may be less motivated to buy a car now without a handout on the table, which is true...that was only a very small part of my argument though.

blame the poor economic climate. blame the layoffs, blame outsourcing, the blame game is pointless, until the recession ends sales in general are going to be poor. sales are not gonna be poor because the government isn't giving a hand-out. stop spreading this misleading information, it is just not true, if you choose to believe it i have no problem, but that you blatantly spread it is an insult to intelligence.

LOL, I did not say, sales are down because there are no more handouts. Stop putting words in my mouth. Sales are down, because everyone who was going to buy a car in the near future, rushed to buy one in time to get the tax credit. Basically fitting a couple months worth of sales in to a few weeks. And that is all the program did really...Its estimated(oh dear, I'm using an estimate), that 60% of people would have bought a car within the year anyway...

give the government praise because it saved many MANY dealerships from closing, gave people a chance to buy new, more efficient vehicles, put money in their pockets, and scrapped all those innefficient, old, antiquated cars off the street.

You mean those same companies that you just railed on for being inefficient and wasting money? And agian, most of these people would have bought a car in the near future anyway...and destroying perfectly good vehicles is just stupid.

the government actually doing something that's not meant for the corporate swine, doing something that worked, doing something to help people weather this storm and you go around spreading nonsense propaganda...

No...its not.

here you are blaming people for taking on loans they cannot afford....

if you did not know it is up to banks and finance institutions to manage their own risk. , the bank doesn't have to automatically sign off on a loan and approve it. and Allowance for Doubtful accounts is a real accounting term, and estimated with accuracy, and it is up to the banks to decide who affords what. it is not the other way around.

So people have no responsibility for the loans they take out...they should not worry about whether they can pay it or not, the bank will decide that...give me a break.

the fact that they (the banks) hide the REAL amount of risk they are carrying in the name of good unrealized profit numbers deep deep in their financial statements is a matter of poor regulation and disclosure.
it is also a matter of allowing creative accounting to put numbers that look great, then hiding the truth behind those numbers with complicated calculations and paragraph behind paragraph of horrendously difficult to understand wording. no wonder investors never saw this coming.

You know, that was a really long post, for not even refuting anything I said.

 

[hom36rown]

lets 'measure'... time for another lesson in FINANCE people... put your thinking caps on....

since YOU assume that measuring is impossible, let me prove you wrong.

it is not difficult,

annual savings is agreed at 733 million,

Speak for yourself, I don't agree with that. Again 60% of people would have bought a car this year anyway. So that wipes out 60% of that supposed annual saving right off the bat. The other 40% probably soon after. Its not as if these sales never would have never happened if not for cash for clunkers...so there goes the rest of your ridiculous equation.

 

[CrackerJax]

The estimate is actually closer to 70%.... but let's not give him fits. He obviously needs to feel like he's right... Throw a lib a bone.....?

Uh, no.

Keysnian economics arer going to prolong the pain and misery of the ppl, just like during good ol FDR's days. FDR turned a 2 year recession into a 16 year depression, which only a world war could pull us out of.

FDR was heard quietly saying after Pearl Harbor...... "Whew!!!! I'll have to thank them Japs later."

Obamanomics............ failure, prolonged.

 

[redivider]

howmgrown, NO, those little equations are the basis of Financial Investments and Portfolio Analysis... I did not ace Financial Markets 1,2 International Finance, Financial Securities, Intermediate Accounting 1 and 2, Advanced Accounting 1 and 2, Governmetal Budgeting and Every economics course that I ever took to be "schooled" by some ignorant conservative. i am also a 75% CPA... just one more test to go....

Look up Present Value, Future Value, study up on investment trading, learn how manufacturing plants actually USE the above equations to determine if switching processes is worth it..... do some research.....

i know i am right....

 

[redivider]

yes, believe it or not if i want to i could go to a bank and ask for a 1 billion dollar loan...

it is up to the bank to determine if i can pay it or not and whether to give me the money... the bank does not have to automatically sign off on a loan.... YES, it is that de-regulated believe it or not, the bank decides, it is not up to the person, it is up to the BANK to decide who can get loans....

 

[redivider]

and craker jax stop talking about economics as if you knew what they were, because you obviously don't... you just keep quoting that ONE "economist"...

the great depression was not caused by the government, it was caused by rumors that banks were running out of money, and people ran to the banks to take out their deposits...

and homegrown, stop mentioning percentages because of what would've happened, i used numbers one of YOUR own threw out there, underestimated the amount of cash people actually received, and set the interest rate at a modest 5%...

in plain english, and in simplified terms:

the gov't spent 3 dollars.of tax payer money

that generated 52 cents in instant cash flow to those same tax payers.

it also generated 73 cents for the next 8 years.

in the future those 53 cents + the 73 cents per year for 8 years are equal to 7.30 cents...

if we discounted that to today it would be worth 5.22, so taxpayers spent 3 dollars and are actually generating 5.22 dollars, the tax payer wins 2.22 dollars. WINS 2.22 dollars...

that type of return on an investment is what investors in wall street dream of...

that is SUCCESS.

 

[CrackerJax]

The govt. BORROWED the money at interest.

You forget that the FED has DOUBLED the amount of dollars in circulation. The banks reserves have increased 17 fold.

Do you not see the problem in that equation? Mr. Economist?

I do not quote one economist. I have merely only posted ONCE about it.

I understand WORKING economics quite well.

I'll leave the HYPOTHETICAL economics in ur trusted hands.... uh huh.

Ur posting gibberish.

 

[PVS]

Yes. Used car sales will be diminished. I think they should have more responsibly handles the 'clunkers' turned in.

there was nothing else they could do since any sale or even giving away of those vehicles out the back door would be a glaring example of conflict of interest, since those vehicles still have monetary value (even if they are/were 'clunkers'.) either new-car dealerships would be pocketing the cash, or the government, likely both. you can't have reliable government oversight for such a program on a car-for-car basis, so thats why it has to be done this way. not only that but it would only favor new car dealers and screw over small used-car-dealers.

i agree that in stimulating the auto industry and reducing dependancy on foreign oil were semi-accomplished goals.

 

[CrackerJax]

there was nothing else they could do since any sale or even giving away of those vehicles out the back door would be a glaring example of conflict of interest, since those vehicles still have monetary value (even if they are/were 'clunkers'.) either new-car dealerships would be pocketing the cash, or the government, likely both. you can't have reliable government oversight for such a program on a car-for-car basis, so thats why it has to be done this way. not only that but it would only favor new car dealers and screw over small used-car-dealers.

i agree that in stimulating the auto industry and reducing dependancy on foreign oil were semi-accomplished goals.

That's a direct hit on the poor... who are the majority buyers of used cars..... nice. Think Bush wouldn't have been screamed at by the loons on that one? H-Y-P-O-C-R-I-S-Y .. what's that spell? yay team!!!

 

[hom36rown]

and craker jax stop talking about economics as if you knew what they were, because you obviously don't... you just keep quoting that ONE "economist"...

the great depression was not caused by the government, it was caused by rumors that banks were running out of money, and people ran to the banks to take out their deposits...

and homegrown, stop mentioning percentages because of what would've happened, i used numbers one of YOUR own threw out there, underestimated the amount of cash people actually received, and set the interest rate at a modest 5%...

in plain english, and in simplified terms:

the gov't spent 3 dollars.of tax payer money

that generated 52 cents in instant cash flow to those same tax payers.

it also generated 73 cents for the next 8 years.

in the future those 53 cents + the 73 cents per year for 8 years are equal to 7.30 cents...

if we discounted that to today it would be worth 5.22, so taxpayers spent 3 dollars and are actually generating 5.22 dollars, the tax payer wins 2.22 dollars. WINS 2.22 dollars...

that type of return on an investment is what investors in wall street dream of...

that is SUCCESS.

How do you figure we are saving 730 million a year, when 70% of that savings would have occured anyway over the next year, w/o spendin billions of dollars.

 

[hom36rown]

howmgrown, NO, those little equations are the basis of Financial Investments and Portfolio Analysis... I did not ace Financial Markets 1,2 International Finance, Financial Securities, Intermediate Accounting 1 and 2, Advanced Accounting 1 and 2, Governmetal Budgeting and Every economics course that I ever took to be "schooled" by some ignorant conservative. i am also a 75% CPA... just one more test to go....

Look up Present Value, Future Value, study up on investment trading, learn how manufacturing plants actually USE the above equations to determine if switching processes is worth it..... do some research.....

i know i am right....

Sure thing boss, you say youre right, so it must be true. But you can't explain how cash for clunkers saved us 700 million a year, considering 70% of that savings would have occurred this year anyway, the other 30% soon after, so the basis of your equation is folly. Oh and lets not forget, that we won't actually pay back this 3 billion legitimately, we are going to end up selling more bonds to cover the debt when its due. Who know what the real cost will be by the time we're done.

 

[ViRedd]

Now that the Cash for Clunker program is over, the car dealers are dying.

 

[PVS]

That's a direct hit on the poor... who are the majority buyers of used cars..... nice. Think Bush wouldn't have been screamed at by the loons on that one? H-Y-P-O-C-R-I-S-Y .. what's that spell? yay team!!!

wow

yes, it excludes those who cannot afford even a measly car payment of say $100 a month for a new econobox, but every incentives program excludes a percentage who have no disposable income, or else we indeed would simply be 'giving away' money. i dont see how this is hypocrisy. just seems like one of your 'evil liberals!!! oogy-boogy-boogy!!!" rants.

 

[CrackerJax]

All of those used cars being crushed DRIVES UP the price of used cars elsewhere.... supply and demand. Used cars are going to be hot sellers, since taxes are up up up and ppl are spending less less less.

Liberals are evil... Evil is often accompanied by the best of intentions.

 

[ChChoda]

How about the economic displacement of currency. Capital that would have otherwise, without a huge government induced incentive to buy a new car now now now, gone to vacations, mortgage payments, health insurance, big screen tvs, gold chains, etc. You know, where it would have gone if government hadn't stepped in to help the auto industry, at the expense of every other purveyor of commodities and services.

 

[PeachOibleBoiblePeach#1]

All of those used cars being crushed DRIVES UP the price of used cars elsewhere.... supply and demand. Used cars are going to be hot sellers, since taxes are up up up and ppl are spending less less less.

Liberals are evil... Evil is often accompanied by the best of intentions.[/QUOTE] Well maybe if the CEO's of the Big three,,decades ago were smart enough, they would not be in the situation they are now, with the competion overseas,,You say it's to bail out the Unions,,The Gov. bailed out chrysler decades ago! Engenieers and CEO's created the pinto, They had decades of trying to get fuel efficency at cost effectivenese,,They failed and continued with quick cash and sales,,Due only to US demand,,To me there is a world wide market,,,and THEY FAILED. That's why there where they are, and promises they failed to keep for the hard working employees. I work do you! or just try and figure how to screw the people that feed you>, Oh yea your going to bash my typing skills,,I'm not a Fing' secretary!

 

[doobnVA]

All of those used cars being crushed DRIVES UP the price of used cars elsewhere.... supply and demand. Used cars are going to be hot sellers, since taxes are up up up and ppl are spending less less less.

Liberals are evil... Evil is often accompanied by the best of intentions.

There is no shortage of used cars, that's just ridiculous. The dealers are already sitting on lots full of used cars they can't sell (which is why they offer you so little for your trade-in) and there's a pretty constant supply of used cars being "created" without those 700,000 they scrapped (which were gas guzzlers, anyway! Who in their right mind is going to buy a gas guzzler when they could buy something more fuel efficient? USE YOUR HEAD!)

Taxes aren't up. Most of us actually got a tax break (I know I did, and so did my fiancee).

Used cars are never "hot sellers", especially used cars from a DEALER - where they mark them up WAY over the actual value of the car. Freaking $5k for a 1998 subaru station wagon with 150k miles on it? I don't think so....

 

[ViRedd]

"Taxes aren't up. Most of us actually got a tax break (I know I did, and so did my fiancee)."

Obviously you don't live in that Progressive Mecca known as Commiefornia like I do. Taxes are definitely up here ... and hardly balances out the paltry $250 tax rebate I got from the Feds.

 

[CrackerJax]

There is no shortage of used cars, that's just ridiculous. The dealers are already sitting on lots full of used cars they can't sell (which is why they offer you so little for your trade-in) and there's a pretty constant supply of used cars being "created" without those 700,000 they scrapped (which were gas guzzlers, anyway! Who in their right mind is going to buy a gas guzzler when they could buy something more fuel efficient? USE YOUR HEAD!)

Taxes aren't up. Most of us actually got a tax break (I know I did, and so did my fiancee).

Used cars are never "hot sellers", especially used cars from a DEALER - where they mark them up WAY over the actual value of the car. Freaking $5k for a 1998 subaru station wagon with 150k miles on it? I don't think so....

Taxes come in many many forms..... the ones you don't perceive on a daily or weekly basis are the worst.

You're just not paying attention..... I'm shocked.

 

[doobnVA]

"Taxes aren't up. Most of us actually got a tax break (I know I did, and so did my fiancee)."

Obviously you don't live in that Progressive Mecca known as Commiefornia like I do. Taxes are definitely up here ... and hardly balances out the paltry $250 tax rebate I got from the Feds.

Well, CA's taxes are CA's problem. From what I understand, you guys got a 1% increase in sales tax (to 9.5%, which is still lower than the tax we pay on FOOD here) an increase in vehicle license tax (still not as high as our personal property tax on vehicles), and a .25% increase on state income tax.

I was talking about FEDERAL taxes, by the way. Californians were included in the federal tax cut, which is not a "rebate", but a decrease in the federal taxes withheld from your income. We saw it immediately after Obama said we would - about $50 per pay period or roughly $1200 per year.