No help or wrong help for Detroit?

I'd suggest you stick to commenting on things you know something
about, but I haven't been able to identify any.

 

Its not the long term financing that does it, as you've stated. Its
the low downpayment, or no downpayment, or financing negative equity
in the trade that does it. A downpayment as I've described will never
result in someone being upside down under any reasonable
circumstances. (Oh, yea, maybe if you can find someone who drives
80,000 miles a year, but other than that...)

Ah, then its obvious why you're so confused about auto financing.

So, how is your bought for cash Geo Metro doing?

 

That's fine but you didn't acknowledge I posted the Capital One link
that proved you wrong. That doesn't make you untrustworthy. It means
you're wrong. People can be wrong without terpitude.

This doesn't prove lack of bias. It leads only to a conclusion that
the ability to bribe them is low. Bias is something entirely
different.

Bias aside for the moment, they're certainly not statisticians. Their
repair surveys are a great example of improper sampling. First, its
biased sample (CU readers) and among that its further biased because
among that sample, its those who wanted to send in the survey form.

The data is not controlled concerning repairs versus maintenance, and
many Joe Averages out there don't know the difference.

Its amusing to note things like 2002 cars having brake problems (as
reported by the owners) and the implicit advice to not buy that model
year. Guess what? Next year the 2003 models show up with brake
problems, and then next year its the 2004 models. Has nothing to do
with weak brakes on those cars, just that its time to put on brakes!

They finally covered up the obvious problem with their data collection
method - different ratings for cars that are clones - by grouping
them. They really looked silly with significantly different ratings
for cars reasonably knowledgable people knew were the same. Of
course, the average CU reader didn't.

Back to bias, its completely evident to me they've had a bias. For
maybe three decades now, Japanese cars. Before that it was the VW
Beetle and Plymouth Valiants.

 

Too simplistic. The fact is that the majority of time that someone
buys a share of stock, the money goes to someone other than the
company. The only time the company gets money from it is in the
initial sale.

*************************
Dave

 

MFFY lazyness at trimming corrected.

top posting ignorance corrected.

Dude - get a fucking real news reader and learn how to post before
everyone plonks your ass.

*************************
Dave

 

Economics 101 is a middle school class LOL


mike hunt

 

When you buy a car, where does the money go? The dealer. Is that a
loan to the dealer?

The concept of a loan is that there is a legal expectation that the
money will be paid back, with interest, under the terms of a loan
agreement. The only reason you should expect not to be paid the
specified amount at the specified time is due to bankruptcy by the
debtor.

In contrast, a publicly traded company has no obligation to every pay
a penny to any stockholder. Many do pay dividends (not interest)
which is essentially a share of the profits (past or present.) The
company can discontinue paying those dividends with little or no
notice, even if it is totally solvent. The company may from time to
time buy back stock or issue more, but it is under no obligation to do
either. Virtually all stock trading is investors trading among
themselves.

 

Uh... so was he. I think. Maybe it was satire... or parody... or
maybe he does think you get an ownership take in Chrysler when you buy
a Neon. I dont know, I'm not even sure who said what now.

 

I guess when you buy American cars you think that there is a huge
variation between Monday cars and Thursday cars.

BTW, CR doesn't measure reliability in their testing. It is a broad
based performance evaluation.

If you are talking about reliability, it is based on the survey of
owners of a million vehicles. Predictions of future reliability of a
new model are based on the past history of reliability by that
manufacturer. Generally, they only make a prediction on a new model
if it is a redesign of a previously sold model from a manufacturer
with a stellar record. For example, the 2006 Civic gets a 'much
better than average' prediction.

I suspect you are misinterpreting the J D Power (not "Powers" BTW)
survey as you do with the CR information. CR surveys show many
systems on many cars with 20%, 30% and even higher probability of
failure within five years. For example, Dodge minivan transmissions
from the late 1990s had about a one in three chance of breaking before
their fifth birthday and there is no evidence that they are any better
today. With 14 different systems on each vehicle (by CR's counting),
a few bad areas can add up to a real lemon. If only 2% of all
vehicles had a single failure in the first five years, no one would
care about reliability.

 

That's true of bonds also, but bonds represent loans and stocks don't.

 

This would be a big issue if you were surveying them on their opinion
on the war in Iraq, but the car either broke or it didn't. One could
argue that CR readers are the ideal population to survey because they
are more likely to be paying attention and are probably better
educated and more knowledgable about vehicles than the average owner.

No doubt there can be confusion on this point, but I don't see why it
would create any bias (as opposed to random inaccuracy, i.e. noise).

And yet some cars (Toyotas, Honda Civics) have excellent reliability
for brakes in all years whereas others (ranging from Olds Alero to
Mercedes M-Class to Jeep Grand Cherokee) have terrible reliability for
brakes every year starting in the second year of ownership. I believe
that CR counts pad replacement as a reliability issue if it is
"excessive."

Actually, the corporate twins were always very similar in reliability
records. In fact, CR always pooled data from truly identical twins
like omni and Horizon. But often there are differences between the
twins and CR splits them up. I think the only thing new this year is
giving the identical twins a single report card instead of individual
identical ones. Less than identical twins like the Pontiac G6 and
Chevy Malibu still get separate report cards. And (as far as you can
tell from the first year) have similar records. One difference is
that the G6 appears to have avoided the suspension problems of the
Malibu. However, the paint, body integrity and hardware appears to be
inferior in the Pontiac. Or it may be that Pontiac drivers are more
likely to be young men who are harder on the vehicle.

It is hard to see how any editorial bias would influence the
reliability survey. unless you are going to claim that they are
manipulating the results. As for the overall preference for Japanese
cars, CR was early in coming to the same conclusions as the public at
large.

 

"similar" is not sufficient. The records should have been identical.

Man, that's going back in history! As long as we're heading back, my
disgust at their methods originated with the 80s GM A bodies. You had
Buicks with 3.0 V6s and Pontiacs with 2.8 V6s and sure, that makes the
cars not truly identical. Getting past the engine issues, CU would
report differences in thinks like body hardware and body "integrity",
which is I think the term they used for rust.

More interesting were the differences between the Toyota Corolla and
Chevy Nova, which I think measured the owners more than the cars.

Or it could be Pontiac owners are pickier.

Or did the public come to the conclusions because of CU?

 

Once more. There are many ways a company can raise capital, right? We all
know this. One of the ways is to issue stock. While it's not a loan in the
conventional sense, it is still a way for the company to get money from you,
the stockholder. At the end of the day, that is what it is all about. The
company wants or needs more cash, a potential stockholder is willing to give
it to them--what in the world is so hard to understand about that? To the
stockholder, it's seen as an investment, true, but to the company, it's
working capital. Check out the Dave Ramsey talk show on 55KRC here in
Cincy, if you can get it. He worked on wall street and does a show on
investing.

 

No, not exactly what I meant. You aren't giving a loan to chrysler, but you
are giving them money. How that translates later is up to them. As for
stocks, I was referring to an original issue, from the company. In so much
as it is the company that is recieving the money from the stocks, from your
pocket to theirs. Ok, so don't call it a loan. Call it something else, but
you can't deny that it is the company getting the cash, can you? Nor can
you deny that the company only offered the stocks in the first place to
raise capital that they felt they needed, right? Finally, you are helping
them in this whole thing when you buy a share or two, right? So, if you
want to tell me I am wrong when I say "loan", ok, fine. But however you cut
it, people outside the company are giving money to those inside, to do with
what they want.

I do understand, really, that buying a stock is an investment for me. I was
just pointing out that it is a way companies raise capital, that's all.
There are other ways, of course, but that is one way.

 

If a company tries to sell stock or get a loan the people with money
will want to get their money back with interest

If they do not get interest they lose interest

You wanna get loan
Me not give you money
You angry
You wanna get loan
Me give you money
You not pay back
Me angry
Better you angry

 

Matt, dear boy, I understand fully the difference between a loan and a stock
purchase. I do both. I also understand the difference between a car loan
and a lease, but many would argue that they are both a form of purchasing a
car.

 

True, Dave, and I wasn't looking at anything other than the initial sale. I
used a model of a company issuing stocks to raise capital; I wasn't talking
about stocks already out there. But it sure created a hell of a discussion,
didn't it?

 

First, we are talking about newly issued stocks, or at least I was. I
should have been more clear on that point. Whenever you give up cash, you
expect something in return. You buy a car, you get a product. When you buy
a (newly issued) stock, you also get something--the expectation of dividends
and, hopefully, a rise in the value of the share which is, of course, a part
ownership of the company, although we all know you can't go to GM, present a
share at the front office, and walk away with one/onehundredthousandth of
the main office building, so that part of the arguement is rather moot. But
the company is also getting something, too. Car company sells a car, they
get money for reinvestment--we all know that. Company issues a new stock
and it sells, they have a bit more money for, yep, reinvestment. The deal
between seller and sellee is different, the terms are different, and the
outcome is different, but both parties have expectations.

Now I must take these two rowdy german shepherds outside as they are driving
me nuts! Post on, people.

 

Would like to address a couple of your points, which are valid. One,
companies are not required to declare dividends. You are right, and many
never do, again you are right. This was the risk that the stockholder
agreed to when buying the shares. Second, the value of the stock, whether
it has increased, decreased, or held steady, is not a repayment from the
company and never has to be repaid...I would argue that it does at the time
you decide to sell them back.

 

Talk less and listen more. You'll come around.