You guys are unnecessary tough even when somebody is trying to agree with you! The point of my post was that a bubble burst of the proportion people have be calling for ain't happening. I thought I made this clear by admitting that I'm one of those that could have afforded 400-500k F40 but can't afford a 1mm or 1.5mm one and have nobody to blame (bubbles, irrational markets, dealers hoarding cars all the other crap) but me...
my post had no intention of harshness, apologies. the only point is the one you just restated. atleast the weather is nice today and we can enjoy whichever cars we do own
Nah, we know that you were right in your analysis. No one was correcting you. You even posted the graph to help the people who only read things that have pictures. The comments were directed more toward the doomsayers in this thread.
Hi nis1973, just a clarification, my posts were directed at two trolls previously on this thread I hope it was not interpreted in any way as directed to you. I feel you are fair minded and I don't think anybody is trying to slam the door that a correction might occur or values can drop. Good faith discussion on valuation is a good and healthy thing. The dynamic duo in question spent a lot of time denigrating my friends on this forum, as well owners/buyers here which I did not appreciate. It got to the point where one wished financial ill on Ferrari owners, and the other espoused from the position of fact (vs opinion) on the market trends. this duo has the habit of hiding a bit hoping their past outrageous proclamations are forgotten, only to start the cycle again.
how so? sp500 is within all time highs and f40s are still 3x 2009 prices no? TRs, 512TRs, countaches, f50s, enzos, 550s, dinos are also 3x or more.
I dont know because i dont know them. Some trolls enjoy posting so i wouldnt think your PI work has anything to do with it.
Just saw this at a gas station. I guess there is still plenty of seats left in the room with the herd sign pasted on the door. Gotta make sure they're all accounted for I guess And there need not be an apocalypse or economic downturn in order for this thing to pop. It most likely already has. Just that the dealers and speculators are refusing to give up without a fight. Forever is an eternity, especially when you don't own what you buy. The amount owed to the bank will be a constant reminder of that. Also note. That before every bubble bursts. You hear that same verbatim. "The market was too high, a healthy correction is good and needed." Or "this is just a slight dip after a big runup. Not to worry. " Only no bubble just softly corrects. Never. Especially not one of this magnitude. I've also been enjoying seeing some of the auctions erase results of notable cars that didn't pull enough money. I wonder why Image Unavailable, Please Login
I might be wrong on energy88's post, but Super Dave said he would be laughing if prices didn't collapse (and he was wrong), so I think energy88 is in agreement with our assessment (gets confusing with double negatives) But correct me if I am wrong energy88. ** Again, nobody ever said a correction or a dip could not come. But somebody let me know if I can buy a fully sorted 330 again for 80K like I saw in 09'.
Is this your general feeling? It's an honest question because it is my feeling as well. But then as you posted later on, we see some positive markers. Which is it? To me a lot things dont make sense and we should be hurting more than we are.
I just don't understand, if the collapse is right around the corner, why did you buy the TR? (congrats btw, I sincerely hope you drive and enjoy, I mean that wholeheartedly) - even if it was rebuilt title - when your 'collapse' happens - it affects both clean and dirty titles. You would have gotten a greater discount. Could it be you just love the car and enjoy driving it (and don't care if the value goes up and down?) Wow - what a concept regardless, I Hope you find my question a fair one. In an earlier post you were making fun of a guy' that bought a TR with 20K miles at auction for 80K. Just trying to figure out which version of Bradwilliams we have today. But I doubt any of us will get an answer...
I don't agree, or completely disagree with most of the last few months of comments. However, with that said. Quantitative Easing. If I were to put a graph up of 2008+ to current, you'd see a nice spike in 2010.5, slow rising, but a spike, as money was shoveled into the economy. Then, in December 2014 when it started to dwindle and wind down, a dip, and now, most speculators are 6 months behind the curve, with inventory listed for 6-12 months, still languishing. The "bubble" has not burst, but has levelled out and dropped considerably in the last year (Pebble will be VERY interesting, and if the big auction companies don't take and present the cream of the crop, it will likely be very stagnant, or not hit anywhere close to desired numbers). The plusses are, people aren't hugely leveraged like the 90's bust (Japan obviously pushed that over the top too at the tail end), and there is TONS of cash floating around (for those that didn't spend it on wishes of appreciation). Should be a very exciting year too following Novembers fanfare Could be very telling for the next 3-5 years (cheap cash availability and good routes to go with it).
Something is definitely happening in the Classic Car market. No one knows how far it will go or how long it will take to play out. http://www.ferrarichat.com/forum/vintage-ferrari-market/524346-sheehan-nailed-market-cycle.html Sheehan pegs the current market damage at -25%. To me, this is a healthy correction. But what is a crash? -40%? or -60%? Only after the next cycle begins can we know for sure and how much. Double negatives aside, I interpret Super_Dave's statement you posted earlier as an expected downturn with the extent not cited.
see chart of Nasdaq. barring some Black Swan Event....where Ferrari cars would be the least of our worries, shoot me a PM and let me know when I can buy a fully sorted 330 GT 2+2 for less then 80K again. Image Unavailable, Please Login
the economy has been crap. there is 10 trillion of negative yielding global sovereign debt. investors have been forced out of bonds into equities. the world is messed up. there is no idiosyncratic car bubble. the bubble is QE because the powers to be weren't going to let the system find its natural equilibrium on its own. and again, the cars I look at/care about are all 3x where they were a few years ago and to me a bubble popping is 3 to 4 SD move. one and 2 SDs aren pedestrian.
also if you look at who has been buying stocks from 2011 on, its been mostly companies buying back their own shares. stocks are not at all time highs because the economy is good - theyre at all time highs because bonds are so bad. that's the point.
Yes, 3 standard deviations pretty much wipes out all appreciation for most cars and 4 standard deviations, by definition, would be plowing new ground and would likely result in deflation of the initial investment. There is an interesting example in the nearby Art Market thread about the historical value of a 275 GTB/4 presented in graphical form (Post #194) in nominal dollars over 44 years and includes the "Grandaddy" 1990 crash which may provide guidance in dealing with the current situation. First Point- When the price data is viewed in real inflation-adjusted dollars, the current peak is nearly identical to the 1990 peak (See Post #210 for the adjusted data graph). Second Point- From eyeballing the yearly data points on the nominal (first) graph, the calculated standard deviation from Excel is about $867,000 for this car. Applying this to the 1990 spike, the market for these cars surged by 1.9 standard deviations and fell by 1.7 standard deviations. The "crash" didn't completely wipe out all the gain from base to peak, but expressed in percentages, the loss was an astounding 86%. In today's market, according to Hagerty data, the 275 GTB/4 has fallen $300,000 from the peak, which represents about an 8% loss and about one third (1/3) of a standard deviation. Third Point- I happened to have some old data for a 365 GTB/4 and that standard deviation calculated out to $172,000. In the 1990 spike, the 275 advanced a lot more (2X) than the 365. Thus, market volatility for particular cars apparently creates its own standard deviation magnitude sort of like the higher they fly, the further they fall. Perhaps someday, classic car markets will have alpha and beta technical analysis ratings to measure such volatility. Lastly, as I recall from the 1987 stock market crash, various oil market crashes, and the 2008 financial crisis is that what seems to be missing at this point in time is panic in the streets. The roller coaster seems to be picking up speed but there is very little screaming so far.
What's your macro view? Do you believe an opposite "V" is around the bend? I expected a correction, but outside a Black Swan event, I don't expect to see a crash. ....and more importantly, if there is a crash...I'll be dancing in the streets...first car I would buy would be a 330. Since I personally have no stake, I think I am reasonably unbiased.
Historics at Brooklands June 11th 2016 Results: 1 of 7 Ferraris sold, 3 of 6 Aston Martins sold I'll take the Alpine S111 thanks! Historics at Brooklands - Specialist Classic and Sports Car Auctioneers - Cars
In due course it'll be well worth checking the results from this Zurich auction from June 11th 2016 - not available yet http://www.oldtimergalerie.ch/images/auction/Lots/Liste1.htm
Paul- I don't believe anyone can forecast the future with much accuracy, but do believe that history and tools such as technical analysis can be used in lieu of a crystal ball to form a VIEW of what MIGHT unfold. An opposite "V" (reversal) as you called it is certainly within possibilitiy at this point (50% chance). This is based on the earlier 275 GTB/4 comments above which covered two significant downturns- the "Grandaddy 1990 crash (discussed earlier) and the lesser 2008 downturn which might best be labeled as a healthy correction rather than a crash. As covered previously, the 1990 crash amounted to a market loss of 86% and just under 2 standard deviations while the 2008 downturn was a "mere" 34% and just under 1 standard deviation loss at the time. In the 2009 reversal, what occurred is that the 34% decline just intersected a 2-year moving price average that still had upward momentum. Thus, the moving average became support for the falling market and enabled the market to recover upward rather than continue falling further. Support, resistance, moving averages, etc. are a tool known as technical analysis and one either believes these or not, with those who don't calling it witchcraft. Thus, a "V" recovery from a lower point is possible but will take time to confirm from this point. The 1990 crash took about 4 years to completely unfold. The 2008 correction took about 2 years to play out. What we are watching for at this point in time is for any decline to exceed about 35% and go over 1 standard deviation before we know what we have. My sense is that we are about 1 year into a slow market rollover. As for Black Swan events, I am worried at how fragile stocks, bonds, and world economies seem to be. Particularly troublesome to me are all these derivatives that are still around that have foisted themselves on most markets over the last decade like parasites. I have to admit that I really do not understand the implications of widescale derivatives, but they get my vote for the "Gotcha" that might trigger an event. As for the economy, I believe the only remedy still available to policy makers is to inflate our way out of the debt burden. This would bode well for tangible assets including classic cars. As for the 330 you have your heart set on, why don't you put together annual price data from the 1960s to date like John_B did for the 275 GTB/4 (Art Market thread/Post #210) and we can see if that train might come back to the station someday. We could call it the Second Chance thread. It would be interesting to compare the 330 with other cars, since each seems to have a particular market volatility. I can assure you that technical analysis will not be perfectly accurate for the 330 since people will begin to act on the info while it is still unfolding. For example, it the analysis concludes that 330 prices are going back to $81,000, prices will never actually get there because people like yourself will be jumping the gun and buying at $85-90K to get the jump on other collectors for the choice cars.
Does anyone know what the 246 GT sold for at the Zurich sale on Saturday? If it did not sell, what was high bid? Any info on condition of the car would be appreciated
I would squarely say the crash of the Japanese economy fully falls in my "Black Swan" example, especially since they were pumping 50 million in Ferrari cars a year (along with whatever property they get their hands on). Japanese were caught up in the same kind of hysteria that fed the dot com and property bubbles of 01' and 07' respectively. They still have not recovered and are now firmly in lost decade*S* territory. Combine this with the death of Enzo hyping up cars, recession of early 90s, and US lending tightening up...all spelled doom for valuations. It's very easy to say, "if a major global economic shock occurs, Ferrari prices will go down hard." That doesn't take any sort of special foresight or economic genius. If we suffer some sort of similar crash we saw in 07' of course we'll see other assets take a hit. Doesn't take threads pages long to prove this. I don't have multi-million dollar portfolios of Ferrari in my garage, so I have no skin in the game. If prices go up, I'm happy for my personal friends. If prices go down, (and go down hard) I can acquire a vintage Ferrari. Both scenarios are a win for me, I'm happy as a clam either way. What irks me is folks that seem to prognosticate, or desire a crash from a position of 'schadenfreude' - there seems no shortage of that ilk on these boards, which is strange since there is no way to 'short' the Ferrari classic market.
When you have shows like Legendary Motorcars constantly saying investment or collectability when it comes to almost every ordinary classic car you get what we have here. Good example of what's going on here and the justification and acceptance of rising prices. Kind of like main stream Comedy shows with Characters referencing tech stocks in the 2000s as great investments, when you get to that point everyone thinks it's never gonna stop its soon over There are investment groups buying cars for speculation and others financing there purchases, much like the housing bubble they are gonna voluntarily give these cars up when there values are upside down. Can't recall his name but a famous investor gave up his 80s TR in the 90s after he paid over $300k and its value was low $100s. History repeats itself again.
