New Tractor Sales Are Declining

[2manyrocks]

Yes, that is one school of economic theory. It is based around the idea that the supply of things that can be bought is finite, and therefore there is a limit on the amount of money. Very big with horders and gold bugs. The big advantage to that way of thinking seems to be that if we are accepting those limits it allows for a self-consistant field of economic mathematics to be developed and studied. Professors and universities love that for all the obvious reasons. The disadvantage is that the results of that math don't seem to apply so well to the real economic world we live in.

There are other schools of economic thought as well. Another one popular today is that the supply of things that can be purchased is always expanding as human knowledge and abilities expands. That leads to a different economic math which is more complex and possibly more applicable.

I am NOT an economist and haven't bought into either school of thought. Both are interesting.
rScotty

There's a heck of a lot of money to be had peddling economic bunk. I could post a list of names of people who make a very good living telling people things that sound good, but have no basis in reality.

If Joe Isuzu had been a real person and gone into politics instead of selling cars, he'd be rich today.

 

[Sid Post]

THIS is what I am worried about, too. The less fortunate people who cannot pay their bills because of record inflation caused by avoidable, unnecessarily high inflation!!! We are not being helped by our “leaders” policies.

When wages go up by half the real rate of inflation, people are in fact poorer EVEN IF their paycheck is bigger. This basic economic fact is totally ignored by most major media.

Inflation hurts those least able to afford it most. It is a bit like the morning show host who didn't care about gasoline prices because "she drove a Tesla". The reality of government mandates raising the cost of cars and similar things is unavoidable to the average working-class family but, is irrelevant to the people making the rule changes.

 

[Sid Post]

Looks like we are finally reaching the Minsky moment despite all the efforts to avoid it since 2008. Will be great for anyone with significant cash & liquidity, very bad for anyone reliant on credit. Not sure where the trigger will come from ... commercial RE defaults? Federal shutdown/default over debt ceiling? New regulation of banks? Government pension underfunding? Blow out in credit spreads? Whatever it winds up being, the party is almost over & asset values will reach "once in a lifetime" levels that should permit anyone with cash & balls to fare extremely well on the other side of this.

This reminds me of the Carter presidency and the economic reality of being on a wheat farm during the Russian/Soviet wheat embargo, cheap wheat, and high production costs (interest, diesel, etc.)

Always a market for gems and Rolex watches, no matter how bad it gets, not that I want to sell any of the 'stuff' anyway but I suspect when I pass, my wife will...

Collectible markets go BOOM and BUST all the time. Wine, Watches, 'real' Jewelry, etc tend to always hold some value but, that assumes someone is around that wants those items.

Collectible markets tend to be transitory things as well.

 

[Jack Yuan]

Some people are still doing really well. We can't complain at all... But I think we are in the growing minority

Not the minority, but the silent majority

 

[Sid Post]

All this talk about “corporate greed” is just low hanging fruit.
Sure, it exists, but how about the greed of individuals living off government handouts/welfare/SNAP when there are many perfectly fit for a job? Why is there no energy to go after them, too?

"Low-hanging fruit" is a talking point and myth mostly used by people who often have a weak grasp on reality. Saying something doesn't make it true either.

"Paying their fair share" is an often repeated phrase. While it may be true in a few select cases, the reality is that government spending has to be paid for out of the majority population of normal everyday working-class people because that is where the disposable money is. If you take 100% of the money from those "not paying their fair share", who is left to invest in companies and build out industries?

This is a bit like school bond votes. Farmers and Ranchers bear a much bigger burden on school bonds than city folks so, why wouldn't they vote to support spending "other people's money"? My old high school in rural Oklahoma with a population of 1600 has a $5Million football stadium for this reason! Did the Middle school girls really need a $1Million softball stadium? The football and softball teams certainly will enjoy the new stadiums but, what about the library and other school buildings?

 

[Jack Yuan]

Have you guys been getting all the credit card offers lately? That or they're pushing balance transfers like there's no tomorrow. Perhaps there isn't. I think the only way banks will survive is having "debt assets" on the books. I can't see any other reason for the heavy push to buy something. The third major bank just crashed and burned. JPM took over but that can't go on forever. I think there's more to come.

Prices are just too high right now. The dollar is falling faster than a rock. The budget everyone on capitol hill is fighting over just proves failure is near. The next recession is just around the corner. Unless your income is flexible to the high side, I wouldn't be buying anything right now. Those of us on fixed income can't afford to buy anything but the credit providers are hungry to sell.

I've been wanting to buy a ditch/bank mower but those have gone up over 30-40% since the beginning of the year. That's outrageous! They haven't improved 30-40%. I'm holding on to my cash for now.

Ditch bank mower? Rised 30% THIS YEAR? Who is doing so? I would like to see who dare to do so. PM me please.

 

[Sid Post]

The reality of things today is that the interest on the national debt is going to surpass significant military spending before too long, with current low-interest rates. When interest rates tick up, the interest burden on the national debt will be a real drag on the economy.

Medicare/Medicaid, Social Security, and Government pensions are also ballooning and will be a real impact on the future economy in the USA.

Don't get me started on ESG/Green with initiatives on agriculture! Diesel tractors aren't going anywhere soon when you don't have electric semi-trucks or even practical electric vehicles for most people. People still need to feed themselves so, conventional agriculture will be a reality for most people for a long time into the future.

Yes, modern Hydroponics like you see in the Netherlands with "warehouse" farms are a reality but, they are small-scale right now to the needs of people at large. Dairies, Beef, 'tree" nuts, 'tree' fruits, cereal grains, and similar things ensure conventional farming is here to stay along with our tractors!

 

[Sid Post]

Ditch bank mower? Rised 30% THIS YEAR? Who is doing so? I would like to see who dare to do so. PM me please.

How about ~100Hp Kubota and Massey Ferguson tractors going up ~20% since January?

Kubota pricing, price 'volatility', and availability specifically on the M5's have me pretty anti-Kubota right now.

Massey has seen a 10% and a 6% price increase that I am aware of. $20K to $30K price increases on the 5711D are what I saw in my recent shopping. I found mine on an old invoice and got the dealer to honor it.

 

[Jack Yuan]

How about ~100Hp Kubota and Massey Ferguson tractors going up ~20% since January?

Kubota pricing, price 'volatility', and availability specifically on the M5's have me pretty anti-Kubota right now.

Massey has seen a 10% and a 6% price increase that I am aware of. $20K to $30K price increases on the 5711D are what I saw in my recent shopping. I found mine on an old invoice and got the dealer to honor it.

I mean, I think as tractor attachment dealer, they should be more cautious on rising price. They don't have sales network as big as tractor factory.

 

[Sid Post]

I mean, I think as tractor attachment dealer, they should be more cautious on rising price. They don't have sales network as big as tractor factory.

For attachment dealers, the cost of steel and transportation really drives up the costs of production. I'm sure labor is a factor too but, I tend to think the percentage of production costs for labor will be less for most attachments due to automation than it is for a more complex tractor.

In my case, the 5711D was made in France due to the Dyna transmission but, the loader bucket is clearly marked made in China and the welds look automated.