I thought you said, "Momma don't do used" one time, a while back.
I recently replaced my daily with a 2015 CPO Lexus RC350. Got my "retired" employee price since I worked for Corporate Toyota for a long time. It only had 6500 miles on it and had all the bells and whistles. Lexus CPO's have the standard 2 year/50,000 mile warranty AND 4 years/unlimited mile on top... you can't beat that... I basically can drive the crap out of it until the end of December 2021...
I have traditionally bought 3 year old quality cars coming off lease with less than 36k on the clock and CPO level warranties. They are depreciated but still with lots of mileage left. Two Mercedes and a Volvo. And just bought a loaded Toyota Tacoma crew cab, 2015 with 11,000 miles and CPO warrantee.
Before retirement I always had company cars and that was a great benefit.
Stan Galat posted:I thought you said, "Momma don't do used" one time, a while back.
That's an incredible memory. Went to the Mercedes dealership to buy her an new GLC, the small Mercedes SUV. She hated it. I told her I wasn't going to spend $65k for a new ML (now called a GLE for some reason). I saw this used ML Bluetec in the parking lot which was bigger and cheaper than the new GLC and she was sold. And I really wanted a diesel. With the CPO warranty again a no brainer. Even the most spoiled person can be persuaded to buy used under certain circumstances. Momma will do used if its a nice Mercedes.
IaM-Ray posted:Used is always the way to go IMHO
Absolutely .....and the internet makes it possible to shop at home for the car you want in the area you are willing to travel to or have the car transported from.....but more often than not, in order to get the car I want, I have to buy new....and eat the depreciation...yuk !
Well there are Daily Drivers and toys... DD can be bought used, toys fall into the sentimental ...Mostly Mental 
I will buy used toys if I can find them....collector cars are by definition used....I always buy collector cars that are restored to the level I am looking for.....mostly #2 or #3 drivers...
Restoring a car is a krap shoot and you can seldom recover your cost.
At this point all my cars are toys, being retired I have not bought a car for transportation for 25 years....they are all recreation vehicles .....because....all I do is recreate ....
Yes, buying someone elses restoration, money pit works the best or at least a good used toy, well kept unit is the most cost effective to enjoy for a while and even sell at minimal cost.
BTW, 25 years retired, I think, is a record on this site
I started investing for retirement when I was 17 so I was able to retire when I was about 45.....
But I calculated my retirement income and lived on that for about 5 years and invested the balance.....
I didn't think anything could be more fun than working, but I was wrong ......
Screwing off is a lot of fun....You can read all about it in my best selling book...." Living a Purposeless Life."......if I ever write it... 
I have an acquaintance that retired at 39..y.o. bought a 7% 30 year bond and been living off it in a tax sheltered account ever since
I got to see Phil's new 550 Spyder in person. Very nicely done. Greg and his team did a fantastic job on this one. Very simple and very clean. Perfect color combination and the rear darts really pop on it. I love it.
Congrats Phil!
Seduction Motorsports posted:I got to see Phil's new 550 Spyder in person. Very nicely done. Greg and his team did a fantastic job on this one. Very simple and very clean. Perfect color combination and the rear darts really pop on it. I love it.
Congrats Phil!
Thank you Daniel. That's a real compliment coming from a spyder artist like yourself.
Seduction Motorsports posted:I got to see Phil's new 550 Spyder in person. Very nicely done. Greg and his team did a fantastic job on this one. Very simple and very clean. Perfect color combination and the rear darts really pop on it. I love it.
Congrats Phil!
I second this. I was at Greg's shop last week picking up parts and I was just starring at it. I lost track of time... drooled slightly... woke up... and 15 minutes passed 
IaM-Ray posted:I have an acquaintance that retired at 39..y.o.
Ray, in the early 90s we could not give away 7 or 8% 30 year fixed securities. Everyone wanted 30% equity returns. Well, we all know how that turned out during the 2000's . Those same folks had to work 10-15 years longer. Your friend was a smart guy. We may never again see those fixed yields. Back to Phil's awesome car.
Marty, that was when the market took off and lured everyone in it... watch the bond bubble happen ... soon
Marty Grzynkowicz posted:IaM-Ray posted:I have an acquaintance that retired at 39..y.o.
Ray, in the early 90s we could not give away 7 or 8% 30 year fixed securities. Everyone wanted 30% equity returns. Well, we all know how that turned out during the 2000's . Those same folks had to work 10-15 years longer. Your friend was a smart guy. We may never again see those fixed yields.
You takin to me, Grzywklzsnxtzrcvbzrkw?
YOU TALKIN' TO ME!?!?
No, I didn't even know you in the 90s , LOL
True story: in October, 1999, after the Gramm Leach Bliley Act passed, I took about three weeks to research the world of finance, and learned about "over-the-counter derivatives," which are largely unregulated and functionally uncollateralized side bets big banks and other money institutions make about the future value of, well, just about anything. Even then, the value of all these bets was many multiples of the value of the actual assets comprising the world's economy; so immediately I understood that a huge crash was coming, a when-not-if crash, and that could overwhelm governments' ability to ameliorate the damage. I wrote the story saying this.
Three years later I knew the housing market would be the trigger. In 2005 I wrote that story.
Circa 2008 I found myself at the offices of the Federal Reserve Bank in Richmond VA, as they were reaching out to journalists to explain things. Over lunch, I turned to the man seated next to me, an economist working for the Fed, and told him paragraphs one (1) and two (2), above.
His only response: "If you knew, why didn't you trade on it?"
Did you watch the Big Short.... priceless movie. Got any crystal ball reading now Ed ... do Tell..
Stan I think Marty was saying you failed the spelling bee
I read The Big Short. No crystal ball but not feeling at ease right now re stocks, or anything else.
Structured finance is as big now as it ever was before the 2007 crash, and capital requirements are weak. Most of the money is chasing yield in growth stocks while bonds languish. At these interest rates, the feds ought to be investing, and state and local governments should be borrowing to rebuild basic civilization, but in most places they're handcuffed by arcane debt limits, meaning they have to turn to structured finance. Few if any have the know-how to negotiate these instruments well, and many also lack capacity in the basic requirements—construction management, stolid accounting, fraud control. The result is waste, and then Breitbart, and then cynicism and more arcane rules, rinse and repeat.
US infrastructure is still decades behind where it should be: roads, waterworks, power grid and internet; schools, public health—anything a civilization needs to maintain itself.
Wage growth is still roughly nil despite five straight years of what economists call "solid recovery." So I don't see consumer demand growing much.
Debt levels are up on all fronts, public and private, with college debt at near crisis levels. In addition to being emotionally fragile and irritatingly entitled, kids today are really poor, and will be until their parents die—assuming their parents don't spend down all assets first, which, statistically, most will do.
Internationally: Japan has been in depression since the early 90s, China's trying to manage a massive bubble (and will probably be the next recession trigger). The "Tigers" of the 90s are all a bit fat and lazy. India abides, but has never developed a functional democratic state. Pakistan is batshit crazy as always.
Africa is an extraction zone, mainly for China, with population growth running out of hand and most (not all, but most) national governments dysfunctional. South and Central America are not much better; Venezuela is already under water and will erupt soon.
Europe is only so-so and has been pulling apart of late. Russia is effectively a mafia state attached to a vicious and well-skilled spying and industrial espionage apparatus. Plus nukes.
Personally I've put all my liquid assets in replica Spyder parts. But it's not a portfolio everyone would be comfortable with.
Wow.
Such an astute Economic analysis, thumbnail though it is, I never expected to see on here.
Thanks!
And yes, it would be nice to see Fed interest rates back in the 5% - 7% range to fuel some of that infrastructure growth (and a lot else), but we both know that ain’t gonna happen soon with the prepondurance of current Republicans.
Ed, you are spot on, investing your portfolio assets in plastic replicas as I hear, it's a proven venue. As per Mr McGuire in the movie the Graduate: " There's a great future in plastics, think about it, will you think about it "
Plastic does have a bit of inelastic supply and demand
Gordon Nichols posted:Wow.
Such an astute Economic analysis, thumbnail though it is, I never expected to see on here.
Really? Ed is one of the main reasons I come here every day. Ed is the man.
Yeah, really. Don't take my post wrongly - Ed's whole post was SPOT ON. Like something you'd see in Financial times. A lot of homework contributed to that insight, I'm sure.
Ed is, indeed, the man.......
Ed. Do your speedster buddies a favor. When the stock market is ready to crap out again like it did in 2007 please let us in on it. That was a huge ouch to my 401k.
550 Phil posted:Ed. Do your speedster buddies a favor. When the stock market is ready to crap out again like it did in 2007 please let us in on it. That was a huge ouch to my 401k.
Amen. I’ve held the bag through 2 major bubbles/busts, then sold at the bottom. I’ve been investing since the mid-90s, and probably don’t have my principle back yet. I'm not very good at this. I bought some 5% annuities a few years ago, and feel lucky to have them.
I’d like to retire one day.
Let's face it, investing is gambling in a Brooks Brothers suit.
That world, and many of those in it, have created a jungle of exotic financial instruments that provide sustenance and cover for those who dwell in the canopy and simpler, mundane products for everybody else that payoff less and risk more for those on the ground.
And yet, over time, the stock market has returned between 6% and 8% routinely, with wild spikes and fits of euphoria like we are seeing now followed by diminished fortunes, literally, as the inevitable downturn hits.
I am raising my 17 year old twins with the idea that they should live below their means, pay themselves first in the form of savings and investments, and be prepared for the vagaries of the economy. Flinch but don't quit, be balanced between high, medium and low risk. Assume more risk early in life, reduce the percentage of their fortune at risk as they age, and be careful of fads.
Buy beachfront when you can.
MY vast fortune(:} ?)is from real estate, cant go wrong...Id be broke if i hadnt bought RE and held onto it...good income every month..gonna leave it to my kids i guess, what good is money in the bank getting 2/10th per cent..
All great advice @Panhandle Bob-- but temperament (risk tolerance) is something you either have or don't. Everybody thinks they've got nerves of steel and decent timing, but the reality is that "irrational exuberance" always breeds a sense that the part is going to run a little longer (the market has legs!!!), or that downturns are the permanent disruptions of obsolete "buggy-whip" makers. Markets tend to draw people in way too late (see: Bitcoin), or dump when they should be buying.
The problem is that I know deep down that the piper will need to be paid at some point. We can't keep running up the debt forever-- at some point there will be comeuppance in the form of a deep and permanent crash. It's gloom-n-doom I've been waiting for it my entire life, even as I have plowed a fortune into the market. Why? Because a CD yields less than 1% at this point, and has for years. At a minimum (I suppose), real estate is at least something tangible.
Balance is important, as is the ability to cut your losses or take your gains. Balance (in my case) has been pretty hard to achieve, being a single-task oriented person. I'm way-too-deep into local real estate presently, putting way too much into properties in a state that punishes property owners with ridiculous taxes, and in a local economy still reeling from the loss of a Fortune 100 company pulling out and heading elsewhere.
I think Ed has the right idea. I've spent way-the-heck too much on my plastic clown car, but I've gotten 1000x the enjoyment from it as I have watching a stock portfolio sink in a downturn or rise more slowly than the broader market in an uptick. If I'd have capitalized on what I knew was coming, I'd have bought 10 longhood 911s 5 years ago and never looked back. I still think that's what I ought to be doing right now, only with 2002s and Alfa Romeos.
At the end of the day: we came into the world naked, and to dust we shall return. We'd all like this life to be an unending wave of easy, but the truth is it's nasty and brutish and short, no matter how well we play our cards. I'd like my life to have meaning, and have tried to make investments in an unseen kingdom, one where my true citizenship lies, and one where my ROI is always on the uptick. Everything I've got going here is smoke and ash, but I'm grateful for the blessings I've enjoyed on the ride. Perspective, in that regard is something I'm grateful to have.
I'm a doctor so by definition I'm a financial idiot. I've only done 2 financially smart things in my entire life.
I got tired of paying ridiculous rent for my kids to go to UVA so in 2010 when my personal investments were trending down I cashed out a large chunk and bought a small 2 bed 1.5 bath house 1/4 mile from the university. The house has increased in value by almost 50% since I bought it. If I was really smart I'd rent it now that my kids have moved on. But I'm not so I enjoy it and will soon be storing my Spyder there. My financial adviser told me to never sell. Its almost paid for and if the bottom falls out its an easy rental property. Or I can continue to use it for fun. Or if the bottom really falls out I can sell my house in Norfolk and live in it. Or if I die my wife can live in it. Many possibilities.
In 1996 I opened a whole life insurance plan. The premium can be tough to pay sometimes but it has provided life insurance for my wife and has averaged a consistent 5-7% return. And I can borrow against the equity completely tax free. A few months ago I tried to buy an abandoned Chinese drywall house. I was going to use the equity in the life insurance plan to buy the house (purchase would have to be in cash since a bank will not loan money for a Chinese drywall house). Then after I gutted it and rebuilt it I'd sell my current Norfolk house and refund the whole life policy. I didn't get it but at least I had the means to get it.
Dumbest financial decision I've ever made was putting my first son through med school. Other 2 kids also decided to go to med school. You know how that turned out for my pocket book.
Haven't lost a lot of money with motorcycles or replicas. So its been a relatively cheap hobby. Hoping to keep my new spyder for a long time.
I've got my health and my family are all happy and healthy. So I'm a very lucky man. But Ed if the stock market crashes again please give the rest of us some heads up.
Most people are actually technicians in whatever field... Economic know how is not really taught at all in any field of study. If you lucky to have learned to spend less than you make, or live cash ie: without credit... you are a fortunate person.
And Yes Ed, you seem to have vision.... do keep us posted.
I would like to nominate this thread as the best drifting conversation. 10 pages and counting and still interesting. I find myself coming back to it, just to see where it could possibly go.
I've known Kirk at Vintage Speedsters for over 20 years. Near his house is a little bar on the water where we have met up countless times. It has changed owners and names, but I swear if I show up, the same conversation is still going on. People have moved in and out, but the same conversation has been going on for 20+ years.
I know a moderator shouldn't be encouraging thread drift, but bravo! This kind of camaraderie is what makes this site so cool.
-=theron
Guys, thanks.
fwiw I am out of the market because I lost my job in November and yanked my 401k to roll into an IRA, and haven't got the money moved yet. It's gonna go into a Vanguard index fund, 80/20 in stocks, probably in the next two or three weeks, depending on the U.S. Postal Service. If it crashes before then I'll hold it in cash for a couple months longer, but more likely it'll crash right after I buy.
I'm hoping for high sixes over the next 15 years. I plan to throw $250 (at least) at it every month from now until then. If it works out I'll have about $400k at age 67. That's about the best I can hope for now, and if Social Security don't get "reformed"/stolen by the Republicans before then, I'll have just enough to live on.
So, to be bracingly clear: I suspect I'm the least financially secure person on this board. I can sound "smart" because I learnt good word usements in college. But here's how dumb I actually am:
Having tested well in school and being told by a guidance counselor (and many others) that I could do whatever I wanted, career-wise (aeronautical engineering was one high-on-aptitude-list suggestion) . . . I chose to become a newspaper reporter.
This wasn't entirely fanciful when I did it, in the mid 1980s. Newspapers were doing extremely well back then, and while reporters were never going to find themselves in the high tax brackets, it seemed a stable enough gig at the time.
I didn't care either way. I thought it'd be more fun than making TV commercials, and figured I'd take the financial hit because who even cares about money?
I can't stress enough that this attitude was not born of family financial resources. My dad was a body and fender guy, mom a secretary. I put myself through college and, on one occasion, returned home to mom's house for winter break to find a meter guy from United Illuminating ready to shut off the power. Not caring about money was a stupid conceit—the kind of thing a smart(ish) teenager does, in part, to spite his parents.
I could have become a stock broker. I knew some stock brokers. I thought they were assholes. I wanted to help The Peoples. And sometimes I did. But mostly I was in it for the kicks. Being a reporter is, as Mencken said, "The life of kings." You get to learn all you want about pretty much anything you want. That is what I valued, then and today.
I didn't really know what compound interest was or how it worked until I did that story. That was also when I bought my first house, more than 10 years after graduation. I had just paid off my student loans. The house cost me $76,000. I borrowed every penny—and that was not easy, because, as the realtor explained to me, I was "under-leveraged."
i.e., I had not borrowed enough to establish a good credit score.
Now, I had not stiffed anyone. I wasn't late to pay bills. But that didn't matter. What mattered was that I, by living responsibly within my $25k (and less) salary, had marked myself in the financial world as a bad risk.
By this time I was 35 years old. My assets consisted of
1. A 1992 Pontiac Sunbird convertible that I owed $5,000 to my mother on
2. A 1967 Nova SS I'd acquired and refurbed in high school and college
3. A box of Craftsmen mechanic tools, a corded drill, a jig saw, and
4. A Bundy alto saxophone
The house had been built in 1923. The owner had grown up there, and moved out six years before. It had plaster walls and glass door knobs. The ceiling in the sunroom had collapsed, the gutters were falling off and there was an SUV-sized pile of debris in the back yard.
In order to buy the house, the lender ordered these issues remedied. The owner, in her 90s, declined. So I did it myself. In January, 2000. There I was, 25 feet up an extension ladder, the temp in the low 20s, using the back side of a framing hammer to claw the ice missiles out of the gutter before reattaching—to a house I did not own.
I belabor this point because that house—which I still sometimes miss—was my first and maybe only brush with good financial luck. I got a house mate to help with my $800-a-month mortgage, and plowed all my extra cash into stone tile, sheetrock, etc. Three years later I lost my job, but I finished the house and sold it for $146k. I came to Baltimore with $64,000 in the bank—more cash than I ever had before or since.
Looking around at the housing market I realized I'd been lucky. While I could have hung on for two or three years and made a lot more money on it, I could as easily have lost everything.
The lesson I drew was simple: people who earn a splendid salary or inherit wealth can usually live pretty well, and will usually make some good investments—because they can.
People who earn little usually can't. Because, at that scale—the scale of a grown man making $25k, with only a few thou to invest anywhere along with his own sweat—even a really good investment of time and money, like my Hartford house, won't change much. Luck is basically everything.
—unless, of course, you don't care who you hurt. Living in Baltimore, I discovered a whole class of people who buy houses for less even than I paid for my Baltimore home. Most often, they rent them out to "recovering addicts" who pay $400 a month or so to live there. It's a volume business: you put 10 addicts in a three bedroom house (a common practice), you've got a $4,000 per month rent roll. Typically you've got less than $60k in the house. That kind of business doesn't take luck, just indifference to suffering.
As a newspaper reporter I've found a lot of businesses like this. Perfectly legal, very lucrative, and nothing I could personally stomach. I also learned how to read SEC documents. Look at and understand the footnotes; that's my advice to investors.
That $64k I came to Baltimore with melted into a downtown condo I bought in 2005. I paid the least of any unit sold that year, renovated that one too with my own hands and, on paper, made a profit—enough to by a pickup truck (still my daily drive) and an engagement ring. Most of the remaining cash became the down-payment and closing costs on the house I live in today with my wife.
The last $15k or so went into the Spyder project last year.
I may yet get financially lucky, but I'm not going to count on it. As it stands, I'm lucky enough: Karen makes a decent living, our health is relatively good, the house is good enough, we've got some equity and we're paying the mortgage down steadily. And I have that big stupid garage full of fun.
If it weren't 9 bloody degrees, I'd be out there right now....
I've tried my luck at minimal investing several times and face planted. I went onto rehab 3 houses, then moved forward with various kit car / street rod projects and as well known, graduated into speedsters. IMHO with Ed having bought out my home based shop, tools and inventory, now well into his current 550 project and now Ed's financial blog herein, I'll suggest that Ed do us right by hosting "Ed's Financial Round Table" .....some time during Carlisle 2018
You know what I think. I think we all have cabin fever. Too much snow starting to numb our brains. We all need to thaw out and start wrenching or driving. As Theron points out this site brings out many forms of madness. And I agree that these friendly detours can be interesting and informative. But there is no better madness than car madness. And Ed your spyder is pure madness. Can't wait to see the final product. What a great forum.
550 Phil posted:You know what I think. I think we all have cabin fever. Too much snow starting to numb our brains. We all need to thaw out and start wrenching or driving. As Theron points out this site brings out many forms of madness. And I agree that these friendly detours can be interesting and informative. But there is no better madness than car madness. And Ed your spyder is pure madness. Can't wait to see the final product. What a great forum.
Sending some sunshine and warmth to those freezing their tucchasss off
......
I’ve never done well on the stock market, always having invested at the wrong time in the wrong stocks or companies. So, when I was fortunate enough to come into some money a couple years ago, I promptly started working with a trusted financial advisor, who got me into stable, dividend paying shares in well established companies.
That was the best move I ever made. I will never get tremendous returns, but at least I won’t lose my investments. The one flyer I have taken recently was in a marijuana fund, and that has more than doubled. Too bad I only put a few thousand in it. I also have a couple of stocks that I hope will be long term investments.
Rarely is there such a thing as a quick win in the stock market - think Warren Buffett.