New Tractor Sales Are Declining

[Hay Dude]

Think prices will stabilize but as far as coming down not that much

Part of the results of runaway inflation is to have prices roar upward from the existing price, then settle in between the base and the peak.

Buyers are relieved when the price comes down from the peak and happily buy, even though the price is still much higher than the base.

 

[PreacherM]

I heard from one person (who imports containers of outdoor furniture) that the costs for shipping a container went from 5k pre-covid to 22-25k last year. Currently said it's around 7k now. His feeling was that the customer will eventually see prices drop but will take some time. I'm not expecting any prices to return to 2019 levels, without major recession.

 

[ovrszd]

Here's a thought: John Deere is domestically produced, politically connected, and has been around long enough to have seen this cycle affect their dealers and customers before. In fact, several times.
I wonder if that gives them an advantage?

rScotty

I am 71. Retired 11 years. Debt free.

My Grandson is 22. Self employed. Bought a house 2 years ago.

Which one of us can best handle the pending situation?

Same economic rules would apply to JD versus a younger company.

 

[2manyrocks]

The upcoming Fed 12/14-15 meeting will show whether they will continue raising rates to bring inflation down as previously announced or not. Their rate increases have slowed real estate transactions in middle Tennessee. My guess is it will take another year to see if the 2020-2022 run up in prices will reverse themselves or if we'll just have a stagnant market in which sellers ask too much and buyers can't pay what sellers are asking.

 

[ovrszd]

The upcoming Fed 12/14-15 meeting will show whether they will continue raising rates to bring inflation down as previously announced or not. Their rate increases have slowed real estate transactions in middle Tennessee. My guess is it will take another year to see if the 2020-2022 run up in prices will reverse themselves or if we'll just have a stagnant market in which sellers ask too much and buyers can't pay what sellers are asking.

Good post!!!

 

[rScotty]

I am 71. Retired 11 years. Debt free.

My Grandson is 22. Self employed. Bought a house 2 years ago.

Which one of us can best handle the pending situation?

Same economic rules would apply to JD versus a younger company.

Well, since you asked I'll attempt an answer. It helps that like yourself I've been around long enough to to see changes in the economy as normal cycles. Us oldsters can handle the situation because we have learned to adapt to whatever cycle we are in.

Your grandson's being self-employed and buying a house 2 years ago strikes me as a similar good position. That was a good time to buy and it seems always a good thing to be self employed.

I was self-employed at 24 when a downturn came along. I laid off about a third of my employees and began to do more of the grunt work myself in the evenings. No problem. Worked more hours is about all. Enjoyed the change from being a full time boss. After awhile the cycle turned up again. My guess is your grandson will do something similar.

So since you asked, I think both you and your grandson are equally well positioned to handle the pending situation.

That just leaves the bulk of the middle of the US population who are neither old and rich and wise - or young, energetic, and able. They have a real problem & I've no idea what they should do.

But I do know that simply blaming their problems on bosses, politicians, or economic cycles doesn't lead to a solution.

rScotty

 

[nova3930]

The upcoming Fed 12/14-15 meeting will show whether they will continue raising rates to bring inflation down as previously announced or not. Their rate increases have slowed real estate transactions in middle Tennessee. My guess is it will take another year to see if the 2020-2022 run up in prices will reverse themselves or if we'll just have a stagnant market in which sellers ask too much and buyers can't pay what sellers are asking.

It helped us personally a bit. Seller dropped the price on a piece of commercial land we'd been considering to move it along. For our purposes the difference in interest rate is minimal, especially since we'll have to refinance in 3-5 anyway....

 

[ovrszd]

Well, since you asked I'll attempt an answer. It helps that like yourself I've been around long enough to to see changes in the economy as normal cycles. Us oldsters can handle the situation because we have learned to adapt to whatever cycle we are in.

Your grandson's being self-employed and buying a house 2 years ago strikes me as a similar good position. That was a good time to buy and it seems always a good thing to be self employed.

I was self-employed at 24 when a downturn came along. I laid off about a third of my employees and began to do more of the grunt work myself in the evenings. No problem. Worked more hours is about all. Enjoyed the change from being a full time boss. After awhile the cycle turned up again. My guess is your grandson will do something similar.

So since you asked, I think both you and your grandson are equally well positioned to handle the pending situation.

That just leaves the bulk of the middle of the US population who are neither old and rich and wise - or young, energetic, and able. They have a real problem & I've no idea what they should do.

But I do know that simply blaming their problems on bosses, politicians, or economic cycles doesn't lead to a solution.

rScotty

I must have not described the situation very well. My Grandson and I are not in the same position. Not even close to the same position.

My basic point was in regards to debt ratio. It's a killer in bad times. Remember the early 80s? Farmers went broke by the dozens when interest rates approached 20%. Had they been debt free they would have thrived then. Their cash would have purchased excellent assets at a value price.

 

[scootr]

I doubt dept free farming even exists. Very few people living dept free too. In fact records show the average American is carrying more dept today than anytime in the last 10 yrs

 

[ovrszd]

I doubt dept free farming even exists. Very few people living vept free too. In fact records show the average American is carrying more dept today than anytime in the last 10 yrs

Yep. Even my large farmer friends borrow the money to put in a crop.

I think the increased debt ratio for the average American is an indicator of their overspending. That is going to bite them hard thru the next couple years.