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November 23, 2008 – Comments (2)

I do go on about debt.  It is everywhere and it is the problem, not the solution and this stupid media bites would suggest.  So, just what debt is out there?

  • Mortgage debt
  • Commerical debt
  • Credit card debt
  • Corporate bonds
  • Student loans
  • Car loans
  • Lines of credit...

The list is extensive and much of this debt is at a point that it can't be repaid.  It is good reason to be very conservative with investments.  I said it before and I'll say it again, I think the media bite about getting loans going with the bail is total nonsense.  The bail out is about the fact that your savings are completely and entirely wiped out by bank failures and the inability of the federal insurance to cover the losses without those losses being covered somehow.

Anyway, there are tons of homes that the mortgage is bigger than the value of the home, and there are tons of car loans where the loan is bigger than the value of the car.  Big picture has an interesting post as to the degree to which it is a buyers market for cars right now, I suppose if you aren't too far in debt...

2 Comments – Post Your Own

#1) On November 23, 2008 at 1:02 PM, rebelseeker (90.38) wrote:

  Buyers market period.  If you have cash or solid credit score with conservative debt ratio you are GOLDEN.  But if you are GOLDEN, you are not in a hurry at this time to increase your debt. Some very good deals out there and more coming.  Pick and choose (wisely).

Rember the 1st variation of the golden rule. 

"Person with the gold (money) makes the rules".

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#2) On November 23, 2008 at 1:04 PM, dwot (47.53) wrote:

Big Picture has another good post, on comparison to the depression.

I was thinking depression type problems a good 8-12 months before I wrote this post last January.  I was 100% out of the market in July and I just dabbled back in with the crash in August 2007 before I just took a look again and decided it was nuts to be investing in a market that I was thinking had more in common with the depression then anything in any one's recent memory, and I entirely exited by November 2007.

Seems the events are proving me correct in my beliefs.

And sure, some people make money in down markets.  I decided I was content with just protecting my capital and taking my time.

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