We have been living beyond our means for decades. Our corporate captains and politicians have allowed our manufacturing capabilities to be off-shored. Consequently, our standard of living can only return if manufacturing returns to our shores. As difficult to accept, wage parity or high cost goods (through import tariffs) needs to happen. The system needs to vomit the over-indulgences of the past in order to heal ourselves to prosperity.
The world and those in charge are only interested in a quick fast buck. They have no interest in the greater good or even the future of their own country. Greed will be the end of the human race.
....and this can create a paradox, if you have saved the money to buy something it is more difficult to spend it than using money you haven't got.
The trouble is if you try and time it and you get it wrong then you might end up in a pretty miserable position. For example my mum (91) has just gone into a care home which costs £1,450 a week. Luckily she has savings and also a house to sell so she will be fine and has enough but she will burn through it pretty quickly. There’s no way the local authority will pay for her to stay there if she ran out of cash. I never really understood the argument against voluntary euthanasia that the family might put pressure on the person to ‘end it early’ but I can see where they are coming from.
I’ve witnessed people begrudge someone “hanging on” seeing their inheritance dwindle away paying for care and yet wouldn’t entertain taking that family member in and caring for them themselves which opened up a whole other argument when there’s more than one sibling involved bickering over how they should get more than someone else because they looked after them etc. Then there’s the money left to grandchildren argument “why do they get more money than us just because she couldn’t keep her knickers on and got 6 kids and we’ve only got one” People can turn pretty vile when there’s a whiff of money in the air. I’ve never been one to “expect an inheritance”
But that argument means most people will never own their own property. Nothing wrong with credit used right.
Right now, credit is far from being used right. Credit Card, LOC and Mortgage debt has gotten out of hand. Property values have escalated way beyond ordinary income as a result. Not that's it's likely to happen, but real estate prices should crash to equilibrium making homes affordable as they once were.
You are misinterpreting what I said….again. Used right for yourself, not the lender. Even if house prices reduced to affordable levels I can guarantee interest rates would rise so they still cost the same. Banks have too much power and influence within political circles. Problem is we do not live in a real democracy.
We have "Smart Homes, "Smart Watches" and yes, "Smart Phones". Why not "Smart Money"? Here's my formula - Loan Interest Paid- Savings Interest Earned = Cost of money. Done correctly the "cost of money" can be quite low or even zero. The key is finding "low cost loans" and High Interest "savings". It's not rocket science........
We’ve probably wandered far off topic now and perhaps should move this over to a more suitable thread, maybe in the lounge?
I agree more or less with the latter part of the above about political circles and lack of a real democracy etc. However, I cannot misinterpret what you wrote: "Nothing wrong with credit used right" The only way credit is used right is by purchasing a productive asset where the credit used provides a tax shield. That's certainly not the case for the populace. Credit abuse raises prices. That's why bikes and everything else is so expensive.
If used right, yes. I have a mortgage of course, but hell no was I gonna rush into the market! I bought a place in NL just before the market went to shit, I waited for 18 months simply as I saw the interest rates headed in my favor... Now I have (had, already paid off the interest) 1.24% interest with a zero deposit mortgage fixed for 10y on a 30y loan. Right now, I'm ahead of plan to pay it off within 15 years. That's credit done right in my opinion. Buying a V4 pikes peak on PCP is credit done stupidly. Again, my opinion and I'm sure it works for some, but not for me. Oh, I've had motorcycles and cars on credit in my younger years, if time travel becomes a thing I'll tell me self how to spend much more wisely and I'll have been 10 years ahead of where I am financially now. Oh well, lessons learned.
There you go. Proves my point. Credit is not an all encompassing evil if used right by individuals to suit their circumstances. We all think we are here for the long haul but the reality is not everyone makes old age.
As I started this thread may I be the one to sum up ? Right now, just on a personal level I wouldn't pony up another near £8K to 10K just to get a V4 S touring Multistrada that's 3 years younger than the 1260 S touring I own. That's what surprised me enough to start this thread. Maybe £5K I would have considered it. I'll keep the bike another year and think about it in 2025. In a few years time I hope to retire, and I wont have as much money as I do whilst currently working. Possibly I'll have to leave the Ducati brand (after 20 years) and go more mid level pricing. Something less maintenance intensive and more home mechanic friendly. I did like the test ride on the Moto Guzzi V85 TT I tried before I opted for the 1260, but that's another story..........
Government debt issuance is off the scale. So is consumer and corporate debt. Credit growth and consequently money supply growth is the root cause of inflation. There was a time when you needed 25% down payment to get a mortgage. Those days are long gone. People here in Canada are leveraging their credit cards and line of credit for a down payment. That's a Loan to Value (LTV) of 100% which is obscene. Sure, there are a few responsible borrowers for their home purchase out there (I get that) but they are a small minority. We are beyond borrowing today. Leasing for consumer goods is the new norm. That does not constitute credit used right IMO. I can't see this ending well. Hopefully one day soon, income will catch-up.
This really makes me sad A question to you and I guess everyone in here hovering around the topic, do you feel the need to upgrade your bikes? I used to, but with my 1260 GT, that is now my forever bike as long as I can make it last. I have no desire to get something faster, bigger, more technically advanced etc, to me the 1260 GT is the perfect bike (after a LOT of mods and adjustments to make it as it should have been...). I however have friends that will jump their credits to the next bike or constantly shell out several grand at minimum each year to refresh their toys. I can't do this, I get too attached
