Ford now on junk bond status and my stock market prediction

DonSSDD

DonSSDD

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https://www.autonews.com/automakers-suppliers/ford-credit-downgraded-junk-sp

I’m thinking this is weird, considering how many F150-250-350’s they sell and the price? Maybe GM will buy them?:crazy:tongue:tongue

I think with all the unemployed in Canada and the US and the big lease and loan payments, there will be a big fleet of repossessions of pickups and suvs. Considering how high prices have gone, the big payments, and people living paycheque to paycheque, this could quickly make for large problems for the whole auto economy?

I remember when we had a real bad downturn in 1991, there were no buyers for repossessed heavy trucks and equipment and it was about 1995 before it came back.

This is getting real ugly real quick.
 
DonSSDD

DonSSDD

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What I can’t figure out is how they could come through the big bull market of the last 10+ years and sell at the current big prices and not have a shitload of profit now? Big bonuses and commissions?
 
wristpin

wristpin

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DonSSDD said:
What I can’t figure out is how they could come through the big bull market of the last 10+ years and sell at the current big prices and not have a shitload of profit now? Big bonuses and commissions?
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Probably several reasons. Big 2 is going to be executive pay and bonuses and also retired production workers retirement pay.
 
IMBVSUR?

IMBVSUR?

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F.O.R.D = Ford Operations Requiem Delivered Well maybe anyway :dunno2 They made it through the recession of 08 without bail out money, maybe they will pull out again. Many car brands have fallen many many years ago, and in recent history ones like Plymouth, Oldsmobile and Pontiac come to mind, so we will see.
 
DonSSDD

DonSSDD

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IMHO, interest rates were too low for too long, they drive house and other prices artificially high.

My buddy bought a new 93 pickup with a snowplough, plain Jane, for $32,000, financed it at current rates, payment was about $800 a month. 2005 replaced it with same setup, cost was $47,000, payment was about $800, but rate was 0%.

Today they sell most people a payment, for trucks, houses, mattresses for god’s sake. The payments stay low and selling price goes up, artificially. The economy runs on that low interest rate/payment and people are financing way more than they should. Terms for new vehicles are going out to 7 or 8 years to keep payments low, truck price keeps going up. And then you can sign a 5 year lease and still owe 40-50% at the end of the term. If you owe more than the vehicle is worth when you want another, just roll up that lease or debt balance into the new one, just sign here, look at payment, not the total amount financed.

Eventually this thing turns into a Ponzi scheme , just takes one hiccup to upset the Apple cart?

This time it was a Coronavirus that upset the whole thing.

Easy solution though, throw a bit of tax money at it, it’s freee, just print some more. Last time the bailout in the USA was $1 trillion, we can start a pool on this time, I’ll guess $5 trillion or more.
 
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59K9

59K9

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not yet tom, it hasn't hit the fan yet...when I was buying my truck a few months ago the salesman quoted me the payment price even though I told him I was paying cash...he looked at me like I had 3 heads when I asked him how people could afford such monthly payments...he said they finance for 8 years now...not trying to sound like an old goat but where the hell do kids get the money to drive these big ford diesels...
 
IMBVSUR?

IMBVSUR?

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I started to buy stocks at 18K the other day. I hesitated because I was sure it was going down, however it went back up to 22K :dunno Should I have been buying down most of the time lately? , at least towards 18K :dunno I still think we could be in real trouble financially in this country, however I have been saying that for about 8 years because I believe the market is artificially stimulated. But look at the market for the last 6 years or so and it doesn't take long to figure out I don't know shi*
 
bobs409

bobs409

 
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IMBVSUR? said:
I started to buy stocks at 18K the other day. I hesitated because I was sure it was going down, however it went back up to 22K :dunno Should I have been buying down most of the time lately? , at least towards 18K :dunno I still think we could be in real trouble financially in this country, however I have been saying that for about 8 years because I believe the market is artificially stimulated. But look at the market for the last 6 years or so and it doesn't take long to figure out I don't know shi*
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Imagine where the economy would be if it wasn't for Trump! Now imagine where it could be if half the damn country wasn't against him!?! Idiots!
 
DonSSDD

DonSSDD

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Stocks have also been chased up hard by low rates, no where else to put your money but stocks. I think they were all artificially high.

I think we will see stocks head down and up in big chunks for the next 6-12 months at least. The virus will not peak for 1-3 months maybe, who knows? Markets and big and small business will not see a turnaround or a bottom until this is on the decline big time.

I think this will also be worse than what happened in 2008 because economically it will have a much wider effect across all sectors. Plus today, we are all over informed and there is a generation who were not around for 1991 or in charge for 2008.

Then there is Saudi Arabia- they will leave their output high until they wipe out a major portion of the high cost shale producers and knock the US well off the top in oil production. Russia may come to heel soon, all the power broker oligarchs and Putin need the foreign currency and Russia will be in big trouble with the virus. But I bet Saudi let this go for a while to kill shale.

After shale is screwed, as the economy comes back from the virus, Saudi cuts back on production and OPEC runs the price back up to above $100.

You also have many weak countries out there with high debt already, Italy, Greece, Spain, the UK post Brexit, etc, there could be some big clunks there too.

I’m also an old goat what do I know?

I think there is a good chance all of the above could come true. I’ve been wrong many times before.

in 2008, the bottom came almost a year later. If I’m right, I’d say the market may bottom at 14-15,000. After at least $5 trillion in bailouts in the US and a similar proportional amount in Canada and around the world.
 
DonSSDD

DonSSDD

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Just read China laid off some of their called back workers, due to a lack of orders. They are over the virus, which started there in Dec (?), but it will take them a while to get orders from the west as we are all off work and there are no orders. The order ramp back up takes time.
 
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