Politics

Out of context: Reply #26546

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  • deathboy-6

    So I have this hypothesis I have been formulating based on my recent used auto seeking.

    I wanted a 2012-2014 WRX 5dr. These cars started at $25,795 MSRP for sport, premium $28,295 sport model and I'll focus mainly on sport model.

    Not knowing original MSRP and just searching autotrader for the car, and going with market logic I found a range where it looks like 22-23k would be a good price. with a good history, stock, and mileage between 40-50k. So ok cool bookmarked some options looked at financing through WF, Shitty rates 5yr/17k on a 2012 46K fully loaded premium... Thought huh, I have perfect credit are they only financing for the trade in value? Than I mentioned to my local subaru mechanic I was thinking of selling and he was like toss me a number, I'm interested. Looking at my carfax @ 8K retail value for A 2003 wrx with a 177k miles. I was pleasantly surprised thinkign my clean title one owner with a shit ton of paper work and well done mods, two sets of wheel and full rack might get me 4-5K. Than looking on autotrader and valuations of other cars I was seeing stockers with no extra multiple owners and 180k in the range of 8-10K. I told my car mechanic hestistantly and said tell me if this is a crazy price $7500. Compared to market it seemed overly fair, but I didn't feel comfortable. Mechanic said no thanks and im not sure you will get that price, which made me look up original MSRPs and really chase down this gut feeling that something is not right.

    KBB says a 2013 WRX Sport Base is worth (and just looking this up it has gone up) $23,408-26,645. High is more than original MSRP.

    Which lead me to question how the fuck could market forces and valuations be so wrong?

    I went to a local dealer and personally looked at a 2013 sport wrx with stick price of 25,999 on the window. Internet price of 23,303. The sales repped talked me up of how great subarus were and how she used to sell them, and i asked well if you use to sell them why is the sticker price on this one more than original MSRP. Complete shock and denial. I contacted there internet sales divison and asked. And even asked directly woudl you purchase a car that has gone up in value? But the only response was that they used software to calculate the best competitive prices for used vehicles. And that the purchasing manager would love it if i called him and he'd be willing possibly to work with me. I declined and said this just jittered me out of the market. Now the car has an additional $1500 off managers special on their website. So theyve moved from 25999 to 21899... Still not worth it but I wonder if someone woke up since I have been watching its price movements from listed. Every month about 333 dollar off.

    Carmax also has one even more expensive at 27K. Carmax a internet stock market darling with inventory surpassing the nest 3 largerest groups. A large chunk of for sell inventory with listed numbers. Which it seems there are a lot of 2016 priced higher than their 2017 brand new versions. I was talking to a guy on craigslist who mentioned carmax has been tryign to buy his car from his post also. Which is weird to be agressively seeking craiglist posts. Also it seems weird their inventory grew a ton, loss revenue but stock up...

    So here is my scary thought. People have been to compliant with valuation software. These softwares take in all the forsale information and give averages of the markets rates. But they seem to be neglecting in most cases the depreciation scale. According to KBB they fully neglected it in my car pursuit. 4yrs with minimal deprecitation and mileage is about 49%. But now show high bluebook over MSRP... We have carmax who has a giant scale of invenotry and with every purchase they can raise the selling price a little higher. Valuation software averages there sell prices and creates a new higher used value. Kind of like the frog in the pot and boiling water.

    Than we have ignorant consumers buying cars at higher values than should exist. Typically a bank would not finance a vehicle that didnt hold its value but since the auto bailout in 2008 and lending practices have been pretty leniant and they even offered 9yr loans + 125% the value of the vehicle for rollover negative equity... A lot of these auto loans are small credit unions... Question is are they lending money agaisnt property not worth the value over the time span they give, in hopes it all gets paid. Are they valuing vehicle used prices the same as everyone else where they make no sense with depreciation.

    If the current market with valuation and large companies like carmax cornering market throguh cheap capital and have created a feedback loop successfully, raising used car prices, padding margins for investors and peaked, and if people realize it, and find them overvalued, will they be a lehamn brothers that breaks the auto industries back. Theyll go BK since there growth model was one to try and corner a market. I cant see them purchasing vehicles for real unmanipulated values. Meaning there large inventory will be suddenly underwater, and every other used car dealership buying cars at the inflated evaulations with be negative causing walking away/bk. Which will result in a large inventory of used being liquidated and hurting new car sales and manufacturers. Now I dont know if people with auto loans walk away from the car becuase suddenly cheaper ones are on the market, but I do know 9yr auto loans are to build a base of lower income less credit worthy people. And WF recently reported deep subprime payoffs early are down and defaults are rising.

    Also current talks with friends who also in the market for a new used saw the prices and left without much thought makes me think this is the peak.

    So has the auto industry gone full on house collapse with low interest rates and asinine term lengths, and false valuations that people blindly accepted as fact (much like moodys triple A) They say auto loans debt are at an all time high, so is this going to be a fuckin killer collapse? Am I missing some market evaluation that can explain the how depreciation value seems to be non existant? Thoughts?

    deathboy -6Permalink
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    • We just bought a used car and I used websites to find the value/mileage of all cars of that year to see if we were getting a fair deal.eryx
    • We also looked at the prices of the same car from the year before and the year after to see how the value held up.eryx
    • i look forward to any/all resolutions to what ever the fuck.BonSeff
    • eryx did it match with depreciation values from original cost?deathboy
    • id love to know model year mileage and all that out of general curiosity. i dont think the subaru market is a bubble in itself because i looked at othersdeathboy
    • my whole thing is the valuations and looking at what is for sell is inflated. the whole valuation checkers models are wrong and being gamed.deathboy
    • I believe the used market dictates depreciation. I have to sell the 06 TDI. I will sell based on the same criteria and how fast I want gone.eryx
    • let me know year/mileage/model im curious to search it. what im seeing is kbb and market is not pricing anything that correctlydeathboy
    • depreciation i think is more dictated by common repair and age. https://www.trustedc…deathboy
    • 40k miles with 4 years wear gets close to plug reaplcement, could have damage and wear on cv boots, rust, age and detrioration etc... new cars with more optiondeathboy
    • new car loaded id expect more depreciation because more components aging and cost of repair, or equalizing the value with the perk incentivesdeathboy
    • ex, id price my car below the cost of a transmission being the next big ticket item at 177k, plus at that age you have suspensions, moutns, and a ton of otherdeathboy
    • possibilites that it has to be priced for the unexpected or for an ignorant consumer. my mechanic straight up called out my fair market price.deathboy
    • Wrong thread? You already posted this in the blog.monospaced
    • i summarized in blog, than sat and developed and realized it was biggerdeathboy
    • but thanks for the downvote. always interesting the people who value casting there votes, unless it wasnt you than i apologize for my assumptiondeathboy
    • apology accepted... this isn't really politics dudemonospaced
    • oh but it is. if you think about it financially with bailouts, interest rates, regulations and lending practices. Not too mention the possible outcomesdeathboy
    • apology accepted because you didn't downvote?deathboy
    • yesmonospaced
    • huh bummer i prefer a populace that downvotes with a comment of reason. a blind downvote always seems so childishdeathboy
    • Well you've got more than one, and I'm not really surprised, considering the absurd length, (off) topic, and content of your post.monospaced
    • its appropriate content unless you can explain why monetary policy, banking regulations and market economies are not best in politics?deathboy
    • anyways i know the downvotes are people downvoting "deathboy" not the content. should change my handle to blackman than it can be racist.deathboy
    • you didn't talk about politics dudemonospaced
    • and yet you can't explain why... do you really believe things are however you believe them? your thinking sometimes reminds me of religious zealots types.deathboy
    • incapable to reason against things they don't believedeathboy
    • and i don't believe you didn't downvote. you are the type of person who gets a little dopamine rush casting your say. you should be honest, i could carelessdeathboy
    • but dammit i was really hoping for someone to take on the challenge to test my theory. even today i saw a 2016 outback w/17k miles priced 500 cheaper than newdeathboy
    • I don't have to explain how you failed to mention the political aspect of this, that's your error, not mine. I'm just pointing out your failure to connect it.monospaced
    • The idea that someone here might challenge your theory is a joke right!? You think anyone cares or thinks you're lying? No they don't. Sorry.monospaced
    • The economic shit happening to the used late model wrx market is totally weird. It's not politics though. If it is, show us how and why. Thanks.monospaced
    • Also I didn't downvote you. So I'm surely not the only one to recognize this.monospaced
    • haha. you who thinks interest rates and monetary policy are in no way political would not downvote. and its not just the wrx market as i saiddeathboy
    • but thanks. I see why you don't think it's political. You only see it as simply pricing and a WRX. If it was that simple I'd agree but this false evaulations ofdeathboy
    • entire used car market, is the the seconds largest big purchase of people behind homes. Perhaps its scamming the peopel becuase they think cars are a depreciadeathboy
    • tive anyways. So people wont default or walkaway. If say carmax growth model stalls and they go bankrupt flooding vehicles with cheap inventory.deathboy
    • it can go a handful of ways but i dont see any of them being good when it corrects. someone is going to lose a lot of moneydeathboy
    • i see a ton of scare on the subprime but nothing of the inflated used prices. Poof to that money if they have been playing like cars are actually worth whatdeathboy
    • perhaps no discussion because nothing exists to borrow an opinion from? If you think about it most things here are sharing of others opinionsdeathboy
    • or perhaps it is a venue where there is little interest or relevance. be more relevant to people looking for a hidden market fuck up to make moneydeathboy
    • not sure why you're arguing with me when you failed to make a political point and instead wrote a 2-page ranting whine about pricing a used piece of shit carmonospaced
    • I'm only trying to explain your downvotes, which you ALSO whined about. Not political either, btw.monospaced
    • If you want to talk about the politics behind pricing a late model WRX, fucking mention them. You didn't, you haven't, and you refuse to. Not my problem.monospaced
    • I'l give you a starting point. Find out which politician is dedicated to fixing the used lesbian sport hatch pricing scheme, and vote for them. LOL.monospaced
    • i did... clearly twice... willful ignorance or a special kind of stupid?... can you simply not see the larger issue im talking aboutdeathboy
    • fuck, the lack of comprehension has me a bit for a loss of words. what you said shows how little you comprehend. what a waste of timedeathboy
    • ... do you think the house implosion was political? or do you believe that was purely market failure outside realm of politics? you cant be that daftdeathboy
    • or fuck my stupidity in thinking i was talking to parrot like they had a mind and could have a conversation and not prerecorded answersdeathboy
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