is the bubble due to burst?

a guy who makes 200K a year and has $800k mortgage and 400K in the bank borrows 300K to buy a Ferrari - that's a leverage. A guy who has 25M in the bank, makes 6M a year and has no mortgage borrows 3M bucks to go buy a boat or an airplane - that's not leverage. get it?

 

Could the first guy actually get a loan like that? Maybe conditions are easier than even I thought?

 

not today - pre 07 a guy who made 40k a year cld borrow 700k without showing any docs - hence the bubble

 

(That has always been true, whether it was a Model A, Ford Thunderbird -------) It may be showing up more in the auctions, but if you have been reading Hemmings as long as I have, whats new?

Cheers
Warren

 

New York Apartments, Art Top Gold as Stores of Wealth, Says Fink - Bloomberg Business

Fink isn't a dumb guy

 

Good article. Thank you.

 

Barrett Jackson Scottsdale is the Ancient Rome of the car world.

It's full of decadence, greed, excess, chicanery, lies, deceit, and outright stupidity. You get people from all over way over paying for stuff because it's the only auction they go to.

I agree with Napolis on the restorations costs vs resale value. But, what I fully expect is a crash in the Dino market from people finding crappy ones, cleaning them up, and sticking them on some auction block selling for 400K when it needs 250K of restoration work to make it 400K

Those are the people who will be burned -- first.

Anyone who doesn't believe collector cars can go down was not around in the 80's. Things will go out of fashion, just like anything else. These fancy dust collectors still oxidize no matter who you are. When the costs to keep it exceed the value given, speculators will dump them like they do a bad stock -- and just as quickly.

 

Looks like you picked it two years ago. Dinos are out of control, it can't last forever.

The shark was jumped with this one:

Rust-Bucket Ferrari Dino Barn Find Sells For $221,000 - Poor Vehicle Condition Doesn't Deter Eager Bidders

I know a guy who missed out on millions because he sold his GTO after the bubble burst.

 

interest rates were not zero in the 80s - that's the difference....1.5 trillion of negative yields globally and negative real rates here in the leader of the free world. very very different environment than the 80s.

 

The market for these cars is also much wider than in the 80s.... Time will tell. I'm sure these things will fluctuate, and there might be instances where specific car valuations severely correct- but as a general rule, I think we are not going back.

 

if we have deflation - everything will go down - the cars will be fun to own while they depreciate. if we have inflation the prices will continue to go higher and they will still be fun to own...that's definitely not a texas hedge so Im happy to own the position....

 

With all due respect, I am biased about Dino's.

I agree this rusty car was a shocking sale. I have never figured out who the new owner is.

I honestly think this car was bought to preserve it as it sits. For a major collector a car like this creates more conversations as it is than what it would be like restored.

I agree we keep seeing mediocre cars coming to auction and selling for strong money, but nothing out of line over the last two years.

We Aswan awesome F-Chatter car sell for cheap, mainly due to a numbers matching issue. The car was Classiche certified. Obviously, that show the number of dealers/investors in the market that don't understand the cars.

The good stuff doesn't make it to market anymore. The real transaction of great cars are private.

Unless we have a huge market meltdown, the Dino is not as subseptible as people say.

It is a great car. It is a beautiful design. It isn't for everyone. It is also something special.

Speaking on behalf of public and private sales, I think the upward acceleration isn't as great today, but this has also stabilized the market. Which, I believe, is a good thing. The number of cars on offer, outside the auction circuit, is at a very low level compared to years past.

Shawn

 

Here's the problem with Dinos:

246 Dino: 190 hp, 15.9 sec quarter mile

Honda Odyssey minivan: 248hp, 15.6 sec quarter mile

 

Proof positive that there's so much more to life than numbers.

 

Not mention a minivan is all done by 85 whereas a dino can run at 100 or more all day.

Sadly in these spec filled paper performance days, where no one goes more than 70 stoplight to stoplight some of the dino magic is lost on observers.

Let me ask which would you rather drive along an winding mountain road?

 

Unless the Swedish Bikini team is in the back of the minivan....

 

Well then I would want to be a passenger in the mnivan. Pref a toyota alphard which is the limo of minvans. Maybe the Ukranian bikini team.

Just learnt that the bikini was named after the bikini attol wher ethe hbomb was tested. Sensibilities change as do cars in fashion.

 

Clearly you haven't driven a Dino. It's not about power.

If you want power, less than $10K will buy you a 400BHP 1990's V12 Merc 600 SEL. But you'll need some coffee to stay awake at the wheel.

 

same can be said for all classic cars...

250 GTO 40 million-75 million can be out accelerated by a new Mustang. probably even the turbo charged 4 cylinder could do it.

Shelby Daytona Coupe 8 million can be out ran by a C7 corvette

A 426 cuda would be destroyed by a standard RT charger let alone an SRT8 or Hell cat

And all of these cars have creature features such as power steering and ac and abs etc...

BUT ABSOLUTELY NONE OF THAT MATTERS!

Performance compared to modern cars has nothing to do with a collector cars value. ZERO

 

my tag keeps better time than my rolex

 

That's a ridiculous comparison. You don't buy any vintage car for its performance vs a modern car.

 

I assume he was being sarcastic.

 

In my experience once rolling and especialy on a mountain road an older car like a dino is really no slower than a modern (within any speed range of sanity), far more enjoyable to drive, provdes a sense of satisfaction and enjoyment in acheving that speed, and has a snesation of speed moderns complety lack, unless its an elise.,

But yeah on paper aGTr is faster.

 

I watched the Florida BJ auction last weekend. Top price was 300k. Second was a 458 at 280k I think. Nothing cracked 1/2 million. Countach went unsold at 385k. Yet some goof paid 26k for a TR replica.

I think the market is done climbing. Now we see where is settles. People will only pay so much. Only a few few will pay more then somthing is worth. You can't set the market on a few.

 

There was no car in the line up to get close to the $500k mark. $385k for an Anni is very strong money; if they really had it, he wasn't a real seller.