Is a spike in tractor prices coming?

[DieselBound]

That almost sounds like a complaint. What's the good side? There has got to be one.

After all, the government is just all of us collectively, so ultimately it does what the bulk of the people want.
I think that is how a democracy is supposed to work.
It's not perfect, just better than anything else.
rScotty

In theory it's "just all of us." I appreciate your comment because it actually explains the direction to take in order to try to fix things. We are pretty much set to see things as separate from ourselves and that provides for division, and those with power like to keep people divided.

I wouldn't say that what we ("we" being US-centric) have is better than anything else. The underlying premise of "our" system is extremely flawed. The flaw, however, has been about as close to being cooked-in as you can get and has been the downfall of all empires. Perpetual growth on a finite planet. History tells us that ideology and leaders have zero influence on bucking the eventual collapse (because they're operating under this flaw). As tensions heat up as conflicts rise as a requirement of obtaining more for growth the governing bodies are forced to clamp down on its own population. Neither the governing bodies OR the populations are willing to admit that it's a problem of growth (and nothing to do with ideology or anything else - it's a simple math equation, the exponential function WILL eventually run into the point of collapse).

Prices will rise a bit. Demand will drop and will continue dropping as there becomes less and less buyers. The struggle will be on rising costs associated with input materials as buyers are squeezed. The Big Boys, with their various tax breaks and connections to core government power will be able to "afford" replacement machinery (accounting depreciation helps build in this cycle, unlike for the average Joe [who isn't likely putting money away for a tractor replacement]); but the number of such folks will also decrease. ALL is directed to "the last man standing." It's just how the system works: in the US there once was a notion of anti-trust, but that's been tilled under; could anti-trust keep the system propped up? no, as it's still operating under that flawed premises of perpetual growth.

 

[DieselBound]

Not a complaint, just a statement of fact.

The good side, if you are for ever expanding .gov power is that socialism is now more acceptable here in the USA than it has ever been.

https://nymag.com/intelligencer/2021/06/socialism-isnt-a-dirty-word-anymore.html

The negative is that people no longer think for themselves and don’t understand that giving the people that caused the problem more power and influence over their lives, isn’t going to lead to them living in utopia, just because that’s what “news” anchors lead them to believe.

The “democracy is supposed to work” part goes out the window the moment you have more people living off funds the .gov takes from someone who earns it and gives it to some one who does not earn it. Once you reach the tipping point the “collective“ of them sinks the ship.

In other words when the group of people receiving funds is larger than the group of people whom the .gov takes them from, things fall apart. We have passed that point already.

61% of Americans paid no federal income taxes in 2020, Tax Policy Center says

The Tax Policy Center said 107 million households, or 61% of taxpayers, owed no income taxes in 2020. That's up from 76 million, or 44% of taxpayers, in 2019.

www.cnbc.com

So now you have people that pay no income tax that, just want to raise taxes on people and businesses to no end. Without understanding, that to compensate for the increasing cut the .gov takes from them, the products they sell, now have to be sold at even higher prices or the business closed. As no business can operate anywhere near the debt our .gov has incurred.

Selective facts are also problematic when not put in context.

Read Sir John Glubb's The Fate of Empires and get back to me to discuss how "socialism" (or any other "ism") is the reason why it'll all go to heck. NOTE: Glubb didn't understand the underlying issue (I do!), but he very clearly shows the rise and fall of empires and notes that no ideology, religion or type of leader could defy the inevitable collapse (all, of course, believe that they are the exception- watch out for human hubris!).

 

[newbury]

In times like these, why is demand so high on everything? I have family in the construction business. They are building new houses as fast as a 3 man crew can. No let up in sight. To Heck with cost increases, build, build.

Why has luxury spending continued at an unprecedented pace?

Because for the most part, once again, the buyers are spending "other peoples" money. Loan rates are extremely low.
Seems like we went through this in 2008.

 

[Milo]

Loan rates are extremely low.

Yep this is probably the driving force behind housing, auto, tractor, and a whole lot of shortages. Raise interest and the shortages will disappear.

 

[DieselBound]

Most construction is pushed by big financial outfits and sold to big real estate management outfits (search "blackrock buying up houses" - it's not quite as bad as folks claim, but it's the trend). All kind of like the money that's being force-injected into the fracking sector. Keep enough money flooding in and it has the appearance of a "good market."

Demand was stalled out during the first part of the pandemic. Lots of entities were squeezing by on squeezed margins and are now going to be expecting those to be ramping back up/increasing (for a very short period of time yes, but long-term no). And on top of that expected growth is an expectation of additional growth (because that's how it all works). Start looking around to see if you can spot who can actually afford anything...

 

[tomplum]

Yeah, I kind of wonder about the push to leave the workforce as we knew it and many of them work from home. It sounds like a great plan, until the employers start doing the math and outsourcing to where the labor is cheap. Of course, it isn't quite as simple as that.

 

[cathy liebchen]

These prices will seem like a bargain a year from now

 

[ovrszd]

In theory it's "just all of us." I appreciate your comment because it actually explains the direction to take in order to try to fix things. We are pretty much set to see things as separate from ourselves and that provides for division, and those with power like to keep people divided.

I wouldn't say that what we ("we" being US-centric) have is better than anything else. The underlying premise of "our" system is extremely flawed. The flaw, however, has been about as close to being cooked-in as you can get and has been the downfall of all empires. Perpetual growth on a finite planet. History tells us that ideology and leaders have zero influence on bucking the eventual collapse (because they're operating under this flaw). As tensions heat up as conflicts rise as a requirement of obtaining more for growth the governing bodies are forced to clamp down on its own population. Neither the governing bodies OR the populations are willing to admit that it's a problem of growth (and nothing to do with ideology or anything else - it's a simple math equation, the exponential function WILL eventually run into the point of collapse).

Prices will rise a bit. Demand will drop and will continue dropping as there becomes less and less buyers. The struggle will be on rising costs associated with input materials as buyers are squeezed. The Big Boys, with their various tax breaks and connections to core government power will be able to "afford" replacement machinery (accounting depreciation helps build in this cycle, unlike for the average Joe [who isn't likely putting money away for a tractor replacement]); but the number of such folks will also decrease. ALL is directed to "the last man standing." It's just how the system works: in the US there once was a notion of anti-trust, but that's been tilled under; could anti-trust keep the system propped up? no, as it's still operating under that flawed premises of perpetual growth.

Do you think China understands this and is trying to avoid it? I offer their maximum children mandate enforced several years ago? Do you think they can overcome this or will their "Capitalist" ideals take over as ours have? I'd like to hear your thoughts about China as a whole? Spare me import/export, political opinions. Just curious in regards to the questions you raised in this post. Thanks.

 

[ovrszd]

Yep this is probably the driving force behind housing, auto, tractor, and a whole lot of shortages. Raise interest and the shortages will disappear.

And this right here completely baffles me..... I've never bought something on borrowed money simply because the rate dropped. If my margin is that thin I'll fail at the first bump in the road of life...

 

[ovrszd]

Most construction is pushed by big financial outfits and sold to big real estate management outfits (search "blackrock buying up houses" - it's not quite as bad as folks claim, but it's the trend). All kind of like the money that's being force-injected into the fracking sector. Keep enough money flooding in and it has the appearance of a "good market."

Demand was stalled out during the first part of the pandemic. Lots of entities were squeezing by on squeezed margins and are now going to be expecting those to be ramping back up/increasing (for a very short period of time yes, but long-term no). And on top of that expected growth is an expectation of additional growth (because that's how it all works). Start looking around to see if you can spot who can actually afford anything...

I'm a peon in the financial scheme. I have no debt. Value on today's markets right at the $1M mark. Costs me $6,500 per year to pay my property taxes. If there's an economic crash and my income is minimized that tax burden will become non-sustainable.

So, during an economic crash I can't afford what I own. Hopefully everyone else will be in that situation and no one will be able to afford it either.

 

[Snobdds]

In times like these, why is demand so high on everything? I have family in the construction business. They are building new houses as fast as a 3 man crew can. No let up in sight. To Heck with cost increases, build, build.

Why has luxury spending continued at an unprecedented pace?

There is a lot of money floating around. When a government increases the money supply by $1...That dollar can be spent up to 7 additional times before it ends up in an asset.

Velocity of money.

 

[ovrszd]

There is a lot of money floating around. When a government increases the money supply by $1...That dollar can be spent up to 7 additional times before it ends up in an asset.

Velocity of money.

My interpretation of the effect of "Stimulus" money. Shouldn't people start being concerned about the end result? I haven't saw any action to slow it yet. I'm in rural Agriculture environment.

 

[rjpotts]

The cure for high prices is high prices.

 

[Hay Dude]

In times like these, why is demand so high on everything? I have family in the construction business. They are building new houses as fast as a 3 man crew can. No let up in sight. To Heck with cost increases, build, build.

That’s so obvious on the build part for multiple reasons
1. Interest rates are historically low
1A. FHA raised the threshold for mortgages to $650,000
2. Homes are a tax shelter
3. Home generally increase in value over time so they are a good investment in troubled times.
4. People are fleeing cities because of failed leadership, crime and riots.

 

[Milo]

They're still building around here (mostly commercial) but residential sure slowed down, thankfully. With building materials and labor both so high the cost was approaching $300 per foot. After paying $200,000 for a lot you could end up spending $800,000 for a 2,000' house!

 

[ovrszd]

They're still building around here (mostly commercial) but residential sure slowed down, thankfully. With building materials and labor both so high the cost was approaching $300 per foot. After paying $200,000 for a lot you could end up spending $800,000 for a 2,000' house!

Our 1,978 sq ft living space house with 540 sq ft attached garage cost us $125 per foot 3 years ago. Never imagined at that time the building costs would rise as they have. That's why I'm so surprised by the building surge. Didn't even slow down thru sinfully inflated material costs.

 

[VH5150]

I went to my local Kubota dealer last week and saw a row of shiny new LX2610's with cabs (oh man I'd love one of those!) but I didn't even bother to ask what the price was because of inflation. New Kubotas were already out of my budget pre-inflation and now they're even more so.

Side note - seriously, why can't they just put the price on the dang tractor? I really dislike having to ask a salesperson.

 

[sixdogs]

I went to my local Kubota dealer last week and saw a row of shiny new LX2610's with cabs (oh man I'd love one of those!) but I didn't even bother to ask what the price was because of inflation. New Kubotas were already out of my budget pre-inflation and now they're even more so.

Side note - seriously, why can't they just put the price on the dang tractor? I really dislike having to ask a salesperson.

That's how some sell things. The they can size you up to see if you are a somebody or a nobody and to what degree you look price-malleable.

Just call on the phone and ask the price. Say you couldn't find the price tag on the tractor. Or, in pre-pandemic times, get the retail price on-line and knock off 10%-12% or 15%. If they balk just say you'll think about it and call them back. That scares them because you could slip away.

A good dealer has to make a buck, however, so I always leave some on the table and I do my homework in advance so if they give me a great deal I just say "yes" right then. No "I'll think about" it at that point.

Just my free advice.

 

[ovrszd]

That's how some sell things. Then can can size you up to see if you are a somebody or a nobody and to what degree you look price-malleable.

Just call on the phone and ask the price. Say you couldn't fine the price tag on the tractor. Or, in pre-pandemic times, get the retail price on-line and knock off 10%-12% or 15%. If they balk just say you'll think about it and call them back. That scares them because you could slip away.

A good dealer has to make a buck, however, so I always leave some on the table and I do my homework in advance so if they give me a great deal I just say "yes" right then. No I'll think about it at that point.

Just my free advice.

And very good advice Six.

 

[Gallows]

I ordered a LX3310 on Dec 15. The good. It's locked in at 0% The bad. He said prices will definitely be going up for anyone ordering in January. Worse? They aren't scheduled to get LX3310 until January 2023