Used Boat Prices Falling

[IXFE]

47 minutes ago, The Hulk said:

Loving it! Just waiting for one of those "used"  26lsvs to show up! 

ahem… don’t you mean 26.5 LSV??

Anyway, you might be waiting a while… word on the street is they ain’t building very many of them. 

[The Hulk]

33 minutes ago, IXFE said:

ahem… don’t you mean 26.5 LSV??

Anyway, you might be waiting a while… word on the street is they ain’t building very many of them. 

They would have sold more if it was a real 27lsv 😂

[IXFE]

1 hour ago, The Hulk said:

They would have sold more if it was a real 27lsv 😂

On this we agree, my friend... 

[The Hulk]

Anyone else seeing how bad the layoffs are hitting outside the tech economy now? 

"US china factory orders already at -40%" although it's significantly more than that already.

Ironically "Quite quitting"  has now become "Quite firing" .. 

I heard some info that puts our industry is on track for a 20-35% drop in new boat sales. This is obviously not going to be an even % amongst different mfgs, different boat types and areas just general market as a whole. 

It's hard to say with some small backlog still in the system although most of that is clearing for wakeboats however some toons are still behind still. (Excluding those paragons it seems! 😂)

Hopefully ita not that large of a decline. For some that means back to 2019 levels for others less, others more.

I questioned the large range and it was explained to me the used market is a BIG unknown right now. Basically how much will used eat into the new market as the price hikes continue on new and there could be a lot more hardly used boats that soon hit the market if times get tougher.This could take a higher % than normal away from new sales in an already contacting economy. 

It will take a full year to see the effects of the current tightening and high rates.  So Q3-4 2023-at least Q1-2024 next year. and we're still not finished rising. Them smart folk better get smarter quicker. 

 

 

 

[OtherBoatisaCessna]

Well, I think you’re probably right @Hulk, but I wasn’t going to be without a boat next summer so I did my job to support the economy.  Finances and economy be damned.  

If the economy gets bad enough for my recent purchase to matter, I’m gonna have way bigger fish to fry.  

[rennis]

13 hours ago, The Hulk said:

Hopefully ita not that large of a decline. For some that means back to 2019 levels for others less, others more.

 

So the sky isn't falling?  Or it is, but just further delayed, but hopefully not as bad as you previously predicted?  I'm trying to read between the lines here. 

[ahopkins22LSV]

15 minutes ago, rennis said:

So the sky isn't falling?  Or it is, but just further delayed, but hopefully not as bad as you previously predicted?  I'm trying to read between the lines here. 

That’s what a bunch of us have been asking for the last two years of “they sky is falling predictions”. Are we saying it’s going to drop compared to the last two years? Or the average of what was before the last two years. The sky is falling experts have never answered that question. 

[shawndoggy]

47 minutes ago, ahopkinsVTX said:

That’s what a bunch of us have been asking for the last two years of “they sky is falling predictions”. Are we saying it’s going to drop compared to the last two years? Or the average of what was before the last two years. The sky is falling experts have never answered that question. 

@The Hulk has predicted 12 of the last 3 recessions.

[dlb]

7 hours ago, shawndoggy said:

@The Hulk has predicted 12 of the last 3 recessions.

He must work as a Wall Street reporter!

Or, he is Chicken Little in disguise.

[The Hulk]

Naa.. we full blown recession now.. 

About every data point has now hit the fan... 

Good luck to everyone in 2023.

 

 

 

 

[rennis]

15 hours ago, The Hulk said:

Naa.. we full blown recession now.. 

About every data point has now hit the fan... 

Good luck to everyone in 2023.

 

 

 

 

No we have not hit full blown recession, and some indicators are actually improving in the 4th quarter, possibly delaying the PREDICTED recession that should hit next year.  Maybe.  but don't just take my word for it.

 

From Gas Prices to Consumer Sentiment

Week in Review: Dec 5-9

Anirban Basu

Dec 9

 

Some economists think recession is coming next year. Others don’t. Either way, it’s pretty clear that next year will be anything but boring. For now, we have to get through 2022, so let’s talk about the first full week of the year’s final month, beginning with . . .

Monday

Gas Prices

Gas prices fell to $3.504 per gallon, the lowest level since the end of January. Gas futures prices are now at their lowest point since November 2021. Good for you, bad for Putin.

Measures of the Services Economy

The ISM Services PMI—a measure of economic activity in the U.S. services sector—increased in November, indicating that the services sector expanded at a faster rate than it did in October. That’s inflationary. The S&P Global U.S. Services PMI fell, however, and remained below 50, meaning the service sector contracted at a faster rate than it did in October.

What’s the difference between the two measures? The ISM measure captures a much larger piece of the economy, as you can see in the table below. So the more narrowly defined group of industries captured by S&P are (allegedly) contracting, but the broader group captured by ISM are expanding. I’m going with ISM. I think the service sector is still active, including in the form of the delivery of construction services.

Factory Orders

New orders for manufactured goods increased 1.0% in October and have now risen during 12 of the past 13 months. Orders were up for both durable and nondurable goods. Inventories of manufactured goods increased again and have now risen in 21 straight months. If recession is coming, it’s not imminent.

Tuesday

Trade Balance

The U.S. trade deficit expanded from $74.1B in September to $78.2B in October. Imports increased and exports decreased. This is: 1) a sign of domestic economic strength; 2) a sign of global economic weakness; and 3) largely attributable to exports of pharmaceutical goods, which were volatile before the pandemic and have gotten a whole lot more volatile since, falling by $2.2B in October.

Wednesday

Productivity

Labor productivity increased at a 0.8% annual rate during the third quarter, which is faster than the initial estimate of 0.3% productivity growth. Productivity equals output per hour worked. Output increased 3.3% while hours worked increased 2.5%. This helps countervail some of the lost productivity earlier this year.

Still, over the course of 2022, the broader story is that employers are paying more for workers who are no more productive (actually less productive) than they were at the beginning of the year. Productivity declined at a 5.9% annual rate during the year’s first quarter and a 4.1% annual during the second for nonfarm businesses. The lowest worker productivity in America occurs when the Ravens play defense during fourth quarters. That is deeply upsetting.

Mortgage Applications

Mortgage applications fell another 1.9% during the week ending December 2. The average loan size on a purchase application was $387,300, which is the lowest since the start of 2021. Woe is the mortgage banker.

Thursday

Jobless Claims

Initial jobless claims ticked up to 230,000 for the week ending December 8. This remains a lower-than-average number by historical standards.

Continued claims for unemployment insurance remain pretty low but have been creeping higher. As of the week ending November 26, continued claims were at their highest level since February, indicating that some jobseekers are finding it more challenging to find replacement employment, though that could be because they are hunting for remote work.

Mortgage Rates

Average mortgage rates fell for a fourth consecutive week, with the 30-year down to 6.33%. Over the past 4 weeks, average rates have declined 0.75 percentage points. That’s the fastest decline in the average 30-year rate since 2008, which if you’ll recall, was not a particularly great time for the housing market.

Friday

Producer Price Index

This measure of inflation, which tells us how the prices domestic producers receive are changing, came in hotter than expected, up 0.3% in November and 7.4% over the past year. That’s not great, but it’s also not terrible.

Goods prices increased just 0.1% for the month, while services prices jumped 0.4%. This is a dynamic we’re starting to see across the economy. The industries that thrived during the pandemic, like retail and tech, are now scaling back and trying to get rid of inventory as demand reverts to something like a pre-pandemic norm. That makes prices fall, or at least rise at a slower pace. The opposite dynamic is apparent in the service sectors, which are relatively more exposed to increases in labor costs.

University of Michigan Consumer Sentiment

Consumer sentiment improved in December, at least according to the preliminary reading. Consumers feel better about both current economic conditions and the future. Working theory: consumer sentiment is nine parts gas prices (see Monday), one part everything else.

Links of the Week

A Brief History of “Kids Today are Spoiled”

The Niskanen Center estimates that the immigration framework negotiated by Tillis and Sinema would contribute $1.2 trillion to GDP over a decade.

“Using Data to Inform the Location of the 20 New Regional Innovation Hubs” (Economic Innovation Group)

“How the COVID-19 Pandemic Changed Urban and Rural Spending Habits” (BLS)

Final Thoughts

After this week, my outlook for the economy is: Slightly improved

I’ve been thinking that the recession will begin during next year’s second quarter. I have to admit, the economy retains more momentum than anticipated. Still, recession is coming. I just wonder if I have the timing right.

Looking Ahead

Next week brings us new data on small business optimism, inflation, and retail sales.

[Steve B.]

"Recession, repression... it's all the same"  Cheech & Chong.

Steve B.

[oldjeep]

All that I know is that we still can't seem to hire enough (qualified) people.  Economy is down - consulting is good because clients don't want to hire FTE's and still need work done.  Economy is up- consulting is good because clients have money to spend on extra projects.  The only bad time I recall in the last 30 years is the dot com bubble, but that mainly flushed out companies and people who shouldn't have been in tech in the first place.

Stuff costs a lot more - which sucks, but that should self correct over time like it always does.

[justgary]

2 hours ago, oldjeep said:

All that I know is that we still can't seem to hire enough (qualified) people.  Economy is down - consulting is good because clients don't want to hire FTE's and still need work done.  Economy is up- consulting is good because clients have money to spend on extra projects.  The only bad time I recall in the last 30 years is the dot com bubble, but that mainly flushed out companies and people who shouldn't have been in tech in the first place.

Stuff costs a lot more - which sucks, but that should self correct over time like it always does.

Indeed, except some customers are eccentric.  I only invoiced 75 hours last year ("we don't have any money"), then the customer called in late spring and said he had found some money.  He asked if I wanted work, and I replied, "Let's Go, Brandon!"  Having had almost two years in near retirement, I decided that the market turndown was enough to bring me back.  I am struggling to make 30 hours a month, so next year I will be even busier.  How do you guys find time for work?

[The Hulk]

We would have been way better off to not print all this money Just go through the initial recession during COVID.. instead we printed 10 trillion plus dollars We postponed the recession with all the printing and freebies... So now we get all the inflation and a bigger recession.. 

[justgary]

14 minutes ago, The Hulk said:

We would have been way better off to not print all this money Just go through the initial recession during COVID.. instead we printed 10 trillion plus dollars We postponed the recession with all the printing and freebies... So now we get all the inflation and a bigger recession.. 

One could argue that everything the government did after the "great depression" only prolonged the depression.  Government spending is the cause on inflation, and never the cure.

[The Hulk]

5 minutes ago, justgary said:

One could argue that everything the government did after the "great depression" only prolonged the depression.  Government spending is the cause on inflation, and never the cure.

Amen 

[The Hulk]

7 hours ago, rennis said:

No we have not hit full blown recession, and some indicators are actually improving in the 4th quarter, possibly delaying the PREDICTED recession that should hit next year.  Maybe.  but don't just take my word for it.

 

From Gas Prices to Consumer Sentiment

Week in Review: Dec 5-9

Anirban Basu

Dec 9

 

Some economists think recession is coming next year. Others don’t. Either way, it’s pretty clear that next year will be anything but boring. For now, we have to get through 2022, so let’s talk about the first full week of the year’s final month, beginning with . . .

Monday

Gas Prices

Gas prices fell to $3.504 per gallon, the lowest level since the end of January. Gas futures prices are now at their lowest point since November 2021. Good for you, bad for Putin.

Measures of the Services Economy

The ISM Services PMI—a measure of economic activity in the U.S. services sector—increased in November, indicating that the services sector expanded at a faster rate than it did in October. That’s inflationary. The S&P Global U.S. Services PMI fell, however, and remained below 50, meaning the service sector contracted at a faster rate than it did in October.

What’s the difference between the two measures? The ISM measure captures a much larger piece of the economy, as you can see in the table below. So the more narrowly defined group of industries captured by S&P are (allegedly) contracting, but the broader group captured by ISM are expanding. I’m going with ISM. I think the service sector is still active, including in the form of the delivery of construction services.

Factory Orders

New orders for manufactured goods increased 1.0% in October and have now risen during 12 of the past 13 months. Orders were up for both durable and nondurable goods. Inventories of manufactured goods increased again and have now risen in 21 straight months. If recession is coming, it’s not imminent.

Tuesday

Trade Balance

The U.S. trade deficit expanded from $74.1B in September to $78.2B in October. Imports increased and exports decreased. This is: 1) a sign of domestic economic strength; 2) a sign of global economic weakness; and 3) largely attributable to exports of pharmaceutical goods, which were volatile before the pandemic and have gotten a whole lot more volatile since, falling by $2.2B in October.

Wednesday

Productivity

Labor productivity increased at a 0.8% annual rate during the third quarter, which is faster than the initial estimate of 0.3% productivity growth. Productivity equals output per hour worked. Output increased 3.3% while hours worked increased 2.5%. This helps countervail some of the lost productivity earlier this year.

Still, over the course of 2022, the broader story is that employers are paying more for workers who are no more productive (actually less productive) than they were at the beginning of the year. Productivity declined at a 5.9% annual rate during the year’s first quarter and a 4.1% annual during the second for nonfarm businesses. The lowest worker productivity in America occurs when the Ravens play defense during fourth quarters. That is deeply upsetting.

Mortgage Applications

Mortgage applications fell another 1.9% during the week ending December 2. The average loan size on a purchase application was $387,300, which is the lowest since the start of 2021. Woe is the mortgage banker.

Thursday

Jobless Claims

Initial jobless claims ticked up to 230,000 for the week ending December 8. This remains a lower-than-average number by historical standards.

Continued claims for unemployment insurance remain pretty low but have been creeping higher. As of the week ending November 26, continued claims were at their highest level since February, indicating that some jobseekers are finding it more challenging to find replacement employment, though that could be because they are hunting for remote work.

Mortgage Rates

Average mortgage rates fell for a fourth consecutive week, with the 30-year down to 6.33%. Over the past 4 weeks, average rates have declined 0.75 percentage points. That’s the fastest decline in the average 30-year rate since 2008, which if you’ll recall, was not a particularly great time for the housing market.

Friday

Producer Price Index

This measure of inflation, which tells us how the prices domestic producers receive are changing, came in hotter than expected, up 0.3% in November and 7.4% over the past year. That’s not great, but it’s also not terrible.

Goods prices increased just 0.1% for the month, while services prices jumped 0.4%. This is a dynamic we’re starting to see across the economy. The industries that thrived during the pandemic, like retail and tech, are now scaling back and trying to get rid of inventory as demand reverts to something like a pre-pandemic norm. That makes prices fall, or at least rise at a slower pace. The opposite dynamic is apparent in the service sectors, which are relatively more exposed to increases in labor costs.

University of Michigan Consumer Sentiment

Consumer sentiment improved in December, at least according to the preliminary reading. Consumers feel better about both current economic conditions and the future. Working theory: consumer sentiment is nine parts gas prices (see Monday), one part everything else.

Links of the Week

A Brief History of “Kids Today are Spoiled”

The Niskanen Center estimates that the immigration framework negotiated by Tillis and Sinema would contribute $1.2 trillion to GDP over a decade.

“Using Data to Inform the Location of the 20 New Regional Innovation Hubs” (Economic Innovation Group)

“How the COVID-19 Pandemic Changed Urban and Rural Spending Habits” (BLS)

Final Thoughts

After this week, my outlook for the economy is: Slightly improved

I’ve been thinking that the recession will begin during next year’s second quarter. I have to admit, the economy retains more momentum than anticipated. Still, recession is coming. I just wonder if I have the timing right.

Looking Ahead

Next week brings us new data on small business optimism, inflation, and retail sales.

My outlook has always been too early on predictions.. I've tried to take a step back and I keep coming to the new conclusion that it takes a minimum of 12 months for policy and $ to flow through to the general economy. 

Energy is up 17-22% YOY, pump gas is down a bit today but will likely go way higher in q1/2.. we have a 10yr problem it will go up soon who knows when if the economy collapses then demand drops and somewhat prices as well. Labor is way up and productivity way down historically. 

If food energy and labor stay high so will PPI.. after all it takes these 3 things to make anything on planet Earth.. 

Gas dropping but ppl act excited it was still way cheaper not too long ago..

A $2-2.25 2*4 went to $12 and is now down to about $4-5 and ppl think it's a great deal! Affordability is all time low on everything. Wages are now at 19-20 straight months of continuous decline vs purchasing power but wage increase a a great success!

IMO the hard landing is coming but probably later next year.. we have a soft pivot but are still increasing so until we stop we can't know the results in general economy for at least 12+ months. 

look at the china indicators -40% "reported" on US orders.. reality it's actually worse than that..slow down.. it's on its way here fellas.. we just don't realize it yet. 

 

 

 

Edited December 10, 2022 by The Hulk

[Steve B.]

Don't change a thing Hulk !

Steve B.

[OtherBoatisaCessna]

3 hours ago, justgary said:

One could argue that everything the government did after the "great depression" only prolonged the depression.  Government spending is the cause on inflation, and never the cure.

One could argue?  I don’t think this is any big secret anymore…

[justgary]

10 hours ago, OtherBoatisaCessna said:

One could argue?  I don’t think this is any big secret anymore…

If I state it as fact, someone will want to see my references.  That would lead to a throttling by the moderators.

Even if I post references, about half of our population will still have socialist tendencies anyway.

[The Hulk]

Seeing more and more used boats hitting dealer boards last week.. 

Few places said consignment only here in out.. 

[dlb]

5 hours ago, The Hulk said:

Seeing more and more used boats hitting dealer boards last week.. 

Few places said consignment only here in out.. 

Many folks are in the order queue, not unusual to have their current boat listed with their dealer.

My dealer does not list them as consignment, just for sale.

[shawndoggy]

On 12/9/2022 at 4:50 PM, justgary said:

One could argue that everything the government did after the "great depression" only prolonged the depression.  Government spending is the cause on inflation, and never the cure.

Is there a contrary example (i.e. economic slowdown with corresponding spending contraction) where the economy came back more quickly?

[Bluefishcay]

One definition of inflation is an increase in the money supply.  Thus be definition, printing more $$ is inflation.  The increase in prices is a side effect of the inflation, not the inflation itself.