Cash for clunkers will get many people even more indebted
- Thread starter crgarcia
- Start date
IMHO, right now is the worst possible time to buy a car. This clunkers nonsense is pulling so many months of sales forward that the bottom is sure to fall out, most likely before the '10 model year ends.
That's my plan. Just have to keep an eye on the dealer lots come next spring. Once there's a spike in cars on the lot they've been force-fed their end of model year allotment from the factory. Then it's time to start shopping price and wait until the last day of the month to hit the five dealers with the best service department records to see once one gives the best deal.
There might be better strategies, but it's worked pretty well for for me since the late '70s.
You vastly overestimate the intelligence of American consumers.
There were droves of housewives who traded in cars that were worth way more than the $4,500 maximum voucher amount to get that "shiny new" (and rapidly depreciating) car, so they could haul groceries from the store 2.1 miles away from their home, when their existing car was more than adequate.
yea. and if we could all get our wives to live in a 900 square foot cracker box house with no airconditioning just think of the money we could save.
That's true. The CFC deal only works (well, maybe) if you're diving a real clunker... like worth $50.
If you car is worth $2,000, then the deal is "worth" only $1,500-$2,500 to you... minus the cost of paying off the rest of the new car, of course.
By unfortunately, we ARE prone to weakness when it comes to things "new and shiny"... even if we have to burden ourselves with debt to have them.
while your earlier explanations sounded very rational you now start to appear quite stubborn.
Was your comment not the exact thing I criticized about the system? The precise problem is THAT it is a widely accepted standard and that nobody questions its usefulness in other aspects of life where credit really plays no role?
By the way you suddenly contradict yourself, while before you clearly defined what credit really is you suddenly claim the responsibility level of a person is highly correlated with their credit score, like as if a gene in our body tells us whether we are gonna be criminals in the future or not.
This is what kind of upsets me because I think its absurd: You basically claim (and you unfortunately reflect the current system) that I am an irresponsible person because I prefer to pay everything in cash and as a result my credit score is lower than it could be.
Was your comment not the exact thing I criticized about the system? The precise problem is THAT it is a widely accepted standard and that nobody questions its usefulness in other aspects of life where credit really plays no role?
By the way you suddenly contradict yourself, while before you clearly defined what credit really is you suddenly claim the responsibility level of a person is highly correlated with their credit score, like as if a gene in our body tells us whether we are gonna be criminals in the future or not.
This is what kind of upsets me because I think its absurd: You basically claim (and you unfortunately reflect the current system) that I am an irresponsible person because I prefer to pay everything in cash and as a result my credit score is lower than it could be.
you want to look smart? So why dont you explain this equation to me: You basically pay interest on your debt in the region of 5.375% pa. So can you tell us on the other side your smart way to put your money to work that yields more than that? You emphasized that the only smart way to work with credit is to have your cash invested in assets that are super safe, so having your cash invested in governent bonds (god forbid anyone else on this planet still believes US govt bonds are safe) or equity really does not count. Maybe you can stear us to a CD or other money market fund that pays you >5.375%? I doubt you are able to, but I am happy to stand corrected. This leads me to conclude that your argument about credit does not hold up at all. In fact your whole argument badly crashes the second you lose your job or get badly ill and as soon as your future stream of cash inflows will be in any way interrupted.
I don't consider it a matter of intelligence per say. I do think that a majority of American consumers are more ignorant of the way finances work rather than being flat stupid. I have long been an advocate of a credit and finance management class being taught in public HS to help correct this issue. Even the most intelligent person who is uneducated in a subject can be duped.
I agree 100% this whole CFC business is nonsense. It really bothers me to see people trading in Hummers they bought just a few years ago on new vehicles only to end up with more debt than savings in gas mileage.
Bullshit, I never claimed anything of the sort about you specifically, so stop making this personal.
Second, if you don't use credit much you won't have much of a credit history and your score is certainly going to be lower than those who have strong credit histories as a result. But, you can cut the crap because it's not going to be down to the level of those who've demonstrated themselves to be financially irresponsible either.