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Again, Shuma speaks the truth.

Yes, a percentage of the purchasers would have bought one anyway, but it's a hefty old discount. This means they can go for a higher model in the range, spending more money. Let me run this past you.

I want to buy a Car. My general budget is £12,000 (this is true. I need to get my own Taxi. Sod leasing from the company for £200 a week.

This should be enough to get me a basic model.

But, you offer me a means to a discount of 1/3 (which as Shuma pointed out is what this pretty much amounts to). That suddenly means I can either save that third and take it to the bank, OR, it makes the higher end of the range accessible to my budget. If going top of the range, after discount, is a matter of £1,000 more than my budget, it's easy to tempt me (finance allowing) to spend that extra money. So yes, I am making a purchase I would have to make anyway, but there is a good chance I will spend more than I initially budgeted for if I can get a good deal.

And as it's the Government supplying the discount, nobody really loses out. The Dealership reports not only higher sales volume in terms of units, but also higher sales volumes of upgrades, accessories etc (you know the stuff which costs a lot and is pretty much pure profit?).

So I ask again.....how is this possibly a bad thing?

And as it's the Government supplying the discount, nobody really loses out

Technically it's still a tax burden, and immense stimulus debt can devalue currency reducing real buying power. Thats really up to the chinese at this point though, and they aren't going to stop stabilizing their currency by buying ours anytime soon so for now it works.

Well, it's nice to know your Government is using your money to help you for once is all I have to say!

Far rather pay slightly higher Tax for the next few years (and onwards if we're being totally honest!) than see the economy languish in the doldrums!

IIRC, sales tax varies across the US yes? I wonder if anyone has number crunched how much on average this is actually costing the Government once they receive their Tax from each sale? But then I guess that depends on how you look at it. One could say (and this is slightly confusing so I apologise) that there is no offset, as any Tax earned from the scheme is swallowed up by the scheme. I think. Like I said, a tad confusing that bit.

Mad Doc Grotsnik wrote:So I ask again.....how is this possibly a bad thing?

Again, I've already subsidized two companies which should have gone C11 bankrupt.

Why am I forced to throw more of my good tax dollars after bad?

What's next, when MS can't sell Windows, we need to prop up PC sales?

The whole thing is stupid.

The whole thing is stupid.

Yep. That is until they don't bail out a major industry and hundreds of thousands of people become unemployed overnight as thousands of businesses fail simultaneously, and billions in savings disappear, causing unemployment to spike significantly with everything that that implies.

Why am I forced to throw more of my good tax dollars after bad?

What's next, when MS can't sell Windows, we need to prop up PC sales?

The whole thing is stupid.

Your whole post is hyperbolic whining. This stimulus plan has nothing to do with the automotive bailout.

So what if people become unemployed? It's happened before and it'll happen again. The idea that jobs are a birthright entitlement is nonsense.

It's the height of stupidity of trying to bail out any other industry past its time. At this rate, why not bail out farmers (oh, wait), or English cottage industries?


And this is definitely an extended bailout. My tax dollars are being funneled into creating artificial demand when the simple fact is that people shouldn't be buying so many cars each year, wasting massive amounts of resources to trash otherwise workable vehicles.

This is a failure from a "true" energy cost standpoint, as each new car consumes vast resources compared to extending the life of an existing car.

JohnHwangDD wrote:So what if people become unemployed? It's happened before and it'll happen again. The idea that jobs are a birthright entitlement is nonsense.

Its not a matter of work as a birthright, but economic participation as a means of both maintaining the rule of law and driving the larger economy.

JohnHwangDD wrote:
It's the height of stupidity of trying to bail out any other industry past its time. At this rate, why not bail out farmers (oh, wait), or English cottage industries?

Because certain industries fulfill greater economic requirements than others.

JohnHwangDD wrote:
And this is definitely an extended bailout. My tax dollars are being funneled into creating artificial demand when the simple fact is that people shouldn't be buying so many cars each year, wasting massive amounts of resources to trash otherwise workable vehicles.

This is a failure from a "true" energy cost standpoint, as each new car consumes vast resources compared to extending the life of an existing car.

You'd think so, but the cost of repair relative to the cost of buying new/used seems to disagree. Ever paid to replace a transmission, or rebuild a motor?

Huh? Swapping an engine and/or transmission is a lot cheaper than buying the equivalent car new.

JohnHwangDD wrote:Huh? Swapping an engine and/or transmission is a lot cheaper than buying the equivalent car new.

That's truth. I paid $5000 for an '86 Honda Accord back in '95. Since then, I've put maybe $3,000 into keeping it running for a grand total of $8,000 to keep it for 14 years. It's not exactly a pretty thing, but it's my work car and it's been highly reliable so what do I care?

JohnHwangDD wrote:Huh? Swapping an engine and/or transmission is a lot cheaper than buying the equivalent car new.

An engine swap in the average FWD mid-size costs about $3,000 USD. A transmission will generally be a bit cheaper, but still probably somewhere in the area of $2,000 USD. A basic mid-size will generally run about $20,000 USD brand new; $2-3,000 USD is a pretty decent down payment on a brand new car that isn't going to incur the maintenance costs inherent in a vehicle which is old enough to have its engine swapped.

Also, let's not forget where those motors and transmissions come from: used cars. Unless you're going to buy a crate motor (anywhere from 4-8k) it isn't particularly likely that you'll be trading for pristine goods.

Typeline wrote:

Illeix wrote:Well, if the health care is going to mimic this, then Obama will borrow a FFSzillion dollars to pay 30 times what health care providers are worth, shut down a thousand or so hospitals and let you trade in your grandmother for a rebate on insurance that they won't pay for.

What are you even talking about?

Sort of a joke that didn't work out right, sorry...

JohnHwangDD wrote:Huh? Swapping an engine and/or transmission is a lot cheaper than buying the equivalent car new.

When the timing belt went on my old Contour it would cost 3,000$ to have the engine replaced. It was a 2000 dollar vehicle. It would cost roughly 5,000$ to fix most of the problems on my old Corisca, and that thing cost me 2,500$.

dogma wrote:

JohnHwangDD wrote:Huh? Swapping an engine and/or transmission is a lot cheaper than buying the equivalent car new.

An engine swap in the average FWD mid-size costs about $3,000 USD. A transmission will generally be a bit cheaper, but still probably somewhere in the area of $2,000 USD. A basic mid-size will generally run about $20,000 USD brand new; $2-3,000 USD is a pretty decent down payment on a brand new car that isn't going to incur the maintenance costs inherent in a vehicle which is old enough to have its engine swapped.

$5k for a rebuilt engine & trans will incur relatively little follow-on maintenance - that's point of rebuilding properly!

Regardless, you're not spending the additional $15k to buy the new car, with it's much higher insurance costs to boot.
____

ShumaGorath wrote:

JohnHwangDD wrote:Huh? Swapping an engine and/or transmission is a lot cheaper than buying the equivalent car new.

When the timing belt went on my old Contour it would cost 3,000$ to have the engine replaced. It was a 2000 dollar vehicle. It would cost roughly 5,000$ to fix most of the problems on my old Corisca, and that thing cost me 2,500$.

As above, if you'd replaced with a new Chevy Malibu, you'd have spent far more.

JohnHwangDD wrote:
$5k for a rebuilt engine & trans will incur relatively little follow-on maintenance - that's point of rebuilding properly!

Even if you get a perfect rebuild (essentially impossible) you can expect to pull, at best, 50-60 thousand miles out of it before it needs to be re-sleeved. Its much more likely to see your car back on a rack within 20 thousand miles due to the tolerance variations that come part-and-parcel with the cylinder and port refinishing process. Unless the guy that rebuilt your motor compensated for the variation by installing premium parts (especially a high end manifold/injector assembly), in which case you're going to pay more than 5 grand. That doesn't even get into the reinforcement required to maintain the life of the transmission attached to an engine which is likely over-bored.

JohnHwangDD wrote:
Regardless, you're not spending the additional $15k to buy the new car, with it's much higher insurance costs to boot.

No, you're just spending 5-8 thousand on an old car with no warranty, mismatched parts, and bad gas mileage.

Seems to me that a lot of people are getting very crappy rebuilds done...

For the prices you're paying, you can have a factory rebuilt motor or trans put in (after offsetting core charges), so I can't see the issue.

A MY 2010 engine should be good for 200+k miles if Japanese. A MY2000 motor would be good for no less than 150k miles to start (200k miles if a Honda, Toyota, or Subaru). A rebuild should add 100k miles to the life.

Now if you're talking Chrysler, then yeah, you got a problem.

JohnHwangDD wrote:Seems to me that a lot of people are getting very crappy rebuilds done...

For the prices you're paying, you can have a factory rebuilt motor or trans put in (after offsetting core charges), so I can't see the issue.

A MY 2010 engine should be good for 200+k miles if Japanese. A MY2000 motor would be good for no less than 150k miles to start (200k miles if a Honda, Toyota, or Subaru). A rebuild should add 100k miles to the life.

Now if you're talking Chrysler, then yeah, you got a problem.

Funny how rebuilds and repairs don't work particularly well as a form of stimulus or as a method of making the net drain of automative gas use less impactful.

Really? Let's do a little mathhammer!

When I first started driving, I drove a 5500+lb Ford Country Squire station wagon. It got 10 mpg highway or city.

If you buy a new car, we'll pretend you would average 30 mpg - a 3-fold improvement.

If you drive 10k miles per year, you would go from consuming 1,000 gallons down to 333 gallons, for a savings of 667 gallons of fuel.

Currently, gas is about $3 per gallon, so that's saving $2k in gas per year. With a $15k cost delta, that's a minimum of 7.5 years to payback the gas.

My current car averages 22.5 mpg, so my upside is a whopping 7.5 mpg increase. I start at 444 gallons per year, saving 111 gallons. Or $333 annually. My payback duration is at least 45 years.

My payback duration is at least 45 years.

No one cares what your payback duration is. Thats not how stimulus plans work. They are there to get you to buy shinny new things thus stimulating the economy.

I am not following the logic of this argument here.

The whole point of this is to stimulate the economy NOW! Not tomorrow or the next day, it needs to start like 2 months ago. Although I think that certain industries are practically unnecessary to the economy and our lives at large.

In the long run we can make huge changes, but for now the buck stops here as far as I am concerned, and the media cannot overhype it enough to stop people from trying to save money when buying a car. I think that is the key to this, saving money while spending, but not letting the saving interfere with your intent to purchase.

With stuff like toys, meh, let the industry crash, they need a wake-up call. For commodities like cars, computers, and the like, there is a serious economy behind it and in need of support. Changes to these industries can and will be made, but that relies on our ability to make it through the now, and maintain enough resolve and sheer tenacity to make the changes we want to see once we are in the clear of this reccession.

Get up and scream about problems, be the incredibly loud guy at protests. Get us out of Iraq, get us better health care, create more jobs with the planet in mind. The main point being, we need to stay angry after all of this, or the real changes that we need to see for the country simply will not happen.

JohnHwangDD wrote:So what if people become unemployed? It's happened before and it'll happen again. The idea that jobs are a birthright entitlement is nonsense.

People made those arguments before. It was great wisdom, all praise the free economy, people will lose jobs but this is only really labour being freed up to work in other industries. Of course, at the time there hadn’t been much study into economics at the aggregate level. But data collection methods improved and it became possible to study the interactions of various parts of the macro economy – these ideas were put in their most complete form in Keynes’ General Theory of Employment, Interest and Money.

And what this new branch of economics argued was such a remarkably simple thing, that if a supply shock of significant magnitude occurs then individuals down the line will each act in their own best interests in ways that will end up worse for us all as a whole. For example, if one part of the economy has a significant retraction, individual businesses will perceive a period of lowered demand ahead and pull back on investments, and individuals will become more concerned about their future welfare and save more. This will lead to further drops in aggregate demand, and in turn to further decreases in investment. It’s a downward spiral where everyone plays his part in making a recession far, far worse than it needs to be.

The basic logic is so intuitive, and it has been observed in countless economies around the world that it is now as fundamental a part of economics as demand and supply. It is taught in highschool as basic economic theory. It isn’t debated or challenged by anyone but fringe nutters like the Chicago School (and if you want a decent example of the quality of Chicago School economics, remember the Chicago School dominate the IMF and the IMF’s record to date is not pretty).

But I understand you have a political axe to grind against the party that's currently in power. So even if they're following very basic Keynesian strategy you're going to complain about it, even if that means you have to pretend economics haven't advanced since the 1930s.

So carry on complaining about the idea of a stimulus if you want but understand that you’re being very silly, and people know that you’re being very silly.

Sebster wrote:So carry on complaining about the idea of a stimulus if you want but understand that you’re being very silly, and people know that you’re being very silly.

From my perspective the argument is based in this technique...

^ Gold!


Automatically Appended Next Post:

JohnHwangDD wrote:Seems to me that a lot of people are getting very crappy rebuilds done...

Seems to me like someone has never dealt with anything beyond factory rebuilds.

JohnHwangDD wrote:
For the prices you're paying, you can have a factory rebuilt motor or trans put in (after offsetting core charges), so I can't see the issue.

Besides the increased price which invalidates the basic premise of your argument?

JohnHwangDD wrote:
A MY 2010 engine should be good for 200+k miles if Japanese. A MY2000 motor would be good for no less than 150k miles to start (200k miles if a Honda, Toyota, or Subaru). A rebuild should add 100k miles to the life.

Actually, Japanese engines are even more sensitive to rebuild problems than domestic products. The ultra-fine tolerance give them amazing performance and reliability, but also make repairs much more difficult and therefore easier to balls up. It isn't uncommon to see a rebuilt B series motor fall apart after 40 thousand.