“New car sales have been steadily rising since we peaked low from the Bush Recession.”
That’s kind of a spin on the facts isn’t it? If you look at the chart, sales were pretty good for the 7 Bush years and really not too bad in 08 either. Then in 09 it tanked to 5.4 million and remained low until 2011 when it hit 6 million or at least a million less than most of the Bush years. It wasn’t until 2013 that the sales got better than they were during the Bush years.
That’s really the true story. Car sales and other economic factors have been in the tank since 08 and I haven’t seen much understanding of what to do coming out of DC. How many years does it take to recover from the “Bush” recession? Yeah and I voted for both of them so I’m not exactly partisan. Just tired of the endless spin of facts to make sleepy people feel better.
That's kind of a spin on the facts isn't it? If you look at the chart, sales were pretty good for the 7 Bush years and really not too bad in 08 either.
Not at all. The Great Recession STARTED in 07 when Bush was president. It took YEARS to recover from it. Recessions don’t just stop… You can’t rewrite History. The bank collapse and the start of the bailouts were when Bush was President. Those are the FACTS. When a recession starts it doesn’t just all at once hit bottom. It takes months or years before it starts to turn around.
Bing, I don’t agree with your earlier economic statement. You said it doesn’t make sense to pay off a 1 to 3 percent car loan early when you can get 5 to 10 percent on your money. Then in your last sentence you talk about sticking it in the bank at 1 %.
If you get a 1%car loan it is subsidized, you are usually forgoing rebates or other incentives.
Where are you going to get 5 to 10 % on your money without risk.
Where are you going to get 5 to 10 % on your money without risk.
Nowhere right now, but when (if) the economy rebounds strongly you could conceivably get such rates at no risk if you invested enough at one time. A relative of mine has a considerable pile of money, and was getting around 5% in long-term CDs before the crash by dumping a quarter million or more at a time into them. Thanks to a little known program called CDARS, you can invest much more than the normal FDIC insured maximum and still be fully FDIC insured.
Extremely wealthy people often take out loans to buy things for exactly this reason. Assuming they have excellent credit, they can get astonishingly low interest rates on loans. Much better to be paying 1% interest on a 3 year loan than to pay it off right away with money that’s sitting in an account earning more than 1%. At normal income levels this is not a big deal, but even a 1% return on 10 million bucks is enough money to buy a very nice luxury car.
Mike, normal recessions last one to two years. This has been a perpetual one with under 2% growth.
Sorry Oldtimer, but where can you get 5-10% without risk? Not many places. Life is a risk. You could be dead tomorrow. However there are some fairly safe mutual funds and state or municipal bonds that are in the 5% bracket and tax free. But again, those that want no risk are bound for the 1% returns.
The 1% rate on CDs isn’t the result of the free market. The market has been manipulated for quite some time to pump up spending and jack up the equities market. Car loans at low/no interest for 7 years is a method of pumping up the economy on Main St’s credit. But when all those with Yugo pocket books are driving diesel Ram 2500s and struggling to make the payments will we really have brought the economy out of the pits?
Mike, normal recessions last one to two years. This has been a perpetual one with under 2% growth.
Show me a economist that didn’t declare the recession over in summer 09.
Yes some parts of the US market hasn’t recovered as fast as others. Engineering has been rising very steadily for past several years. I’m having a very hard time finding good people to hire. 5 years ago I’d post in Monster for a job with a starting salary of $90k and get flooded with resumes (150+ a week)…today I post for a job with the same skill sets with a starting salary of $120k and I got a total of 2 over the course of a month.
Giving credit, positive or negative, to a President misses the supporting cast of characters. Congress enacted laws that allowed bankers to do incredibly stupid things with other people’s money. And don’t forget the throng of borrowers that used the Stupid Money to take out extremely risky loans. One person I worked with in Los Angeles asked we if home loans where the borrower only paid interest and no principal was OK. I said no, not a chance, and I hope he believed me.
Economies don’t always behave according to textbook models. That’s why economics is called the “dismal Science”. In fact, I would hesitate to call it a true science.
Under Nixon we had “stag-flation”. Inflation with no economic growth. Nixon is still highly respected in Europe and the French still wonder what this “Watergate” stuff was all about.
Ronald Reagan profited form an unprecedented explosion is computer science and information technology, and the efficiencies businesses were able to implement and expand their businesses. He also turned the US from the world’s largest creditor to the world’s largest debtor.
However history will remember him as facing down the "evil empire’, helping with collapse of the Soviet Union and freeing up Eastern Europe. How much of this would have happened without him, I don’t know.
The worst is yet to come. That $20 trillion debt is looming over our heads like a storm cloud. Combine that with the high rate of underemployment and the fact that we’re turning into a workforce of part timers without benefits and it ain’t lookin’ good.
I’m lucky. I lived through the good times, when there were jobs, and disposable income, and optimism in the future. I won’t live to see those times again.
Giving credit, positive or negative, to a President misses the supporting cast of characters. Congress enacted laws that allowed bankers to do incredibly stupid things with other people's money.
I’m just counteracting the spin from Rush Limbaugh and Ann Coulter (and other Fox new contributors) who WRONGFULLY called it the Obama Recession. Which is very clear the recession started before Obama was elected.
And don't forget the throng of borrowers that used the Stupid Money to take out extremely risky loans.
That was a small part of the problem. The vast majority of the sub-prime loans were with the blame to financial institutions, regulators, credit agencies. Many finance agencies that were writing loans were changing income of their clients (many without the clients knowledge) so they could get loans. A lot of Fraud. But by far the largest contributor to the collapse was the bundling. Banks were bundling subprime loans with prime loans to make the sub prime loans look good. Then the collapse came…those loans were not looking very good.
The worst is yet to come. That $20 trillion debt is looming over our heads like a storm cloud.
If we had the same growth rate under Clinton, Johnson or Kennedy then we could grow ourselves out of this debt. But the growth rate has been very slow…down near Regan numbers.
But don’t blame only the president each time.
Any one of them can have great ideas going in but get shot down by all the bickering in senate and congress.
So…whomever gets in next, Clinton or Bush, how can WE as voters find out WHO amongst the congress and senate choices would end up making a coherent workable team ?
THAT is the real question…how to actually get something done once in office.
I see it at all levels of multi team government like city , county and state…not just the feds.
One city councilor can have bang up plans and go nowhere with no team .
Lets not forget the role of the feds with Fannie and Freddy. Without these folks buying the worthless mortgages, brokers would have had no market to sell them and the supply would have dried up. Now who insisted that mortgages be given to uncredit worthy folks in the first place?
There were/are problems from both parties but the Carter years were something for the history books. I paid 18% interest for a car from the bank that I had used for 20 years, and that was the best rate available if you wanted a car. Sheesh.
Bing I remember seeing a couple of factory waste baskets. When my parents traded their 1967 BelAir on a 1975 Nova the dealership transferred my Mom’s under dash swing out tissue dispenser. It was chrome with the “bowtie” emblem.
oldtimer 11 I had ABS replaced on my 1991 Cherokee twice under warranty. They were acting up again when I totaled the Jeep in 2001, Defective ABS problem finally solved.