I Have A Question About Purchasing A Car

Originally posted by Ascendancy
He'd likely have it insured, no? Well, one would hope he'd have more than just liability coverage anyway.

Nah, because if your car is destroyed insurance will cover some of the value. If your house burns down with your nest egg inside you're SOL. Plus a pile of money isn't going to get you around reliably day to day =p

auto insurance will recover the value of the car. it will not however recover legal tender that some fool decided to store in it.

I'm picturing Big-C parking his car in a Wal-Mart parking lot with all his life savings stacked up on the passenger seat.

I doubt that Colossus-Big C is digging in trash cans for discarded food-wrapping with sauce-stains to lick off. He obviously has a capital buffer he's loosing his grip on. Normal people don't buy things that they can't afford.

Originally posted by Astner
Normal people don't buy things that they can't afford.

Originally posted by Omega Vision
Yes they do. All the time. At least in America.

Originally posted by Omega Vision
Yes they do. All the time. At least in America.

Sure. You'll have your crackheads who're literally down at zero. But even ghetto trash usually don't have more money invested in the golden chains around their necks than in their bank accounts.

Originally posted by Astner
I doubt that Colossus-Big C is digging in trash cans for discarded food-wrapping with sauce-stains to lick off. He obviously has a capital buffer he's loosing his grip on.

he said he has $5k in savings and is using college grants for the other $15

Originally posted by Astner
Normal people don't buy things that they can't afford.

we meet again, game-theory-models-of-human-economic-behaviour...

Originally posted by Astner
Notice the comme il faut use of the term "normal." I can imagine it being more difficult to uphold in the U.S. -- without universal- healthcare, and education --, however, normal people aren't stupid enough to close their eyes to the risk of unanticipated expenses.

Define what you think the accepted meaning of "normal" is then. I await your tautology or childish fit.

I know educated upper-middle class people without any serious psychological disorders who seriously believe their pyramid scheme of paying off credit cards with credit cards isn't going to collapse. People are stupid. It's a fact of life. Entire business models are based on that.

Originally posted by Colossus-Big C

So I keep it in my car.

LoL, Russians.

Originally posted by Astner
But even ghetto trash usually don't have more money invested in the golden chains around their necks than in their bank accounts.

People who live in the ghetto? Or black people???

Big-C isn't Russian.

Originally posted by Astner
Notice the comme il faut use of the term "normal." I can imagine it being more difficult to uphold in the U.S. -- without universal- healthcare, and education --, however, normal people aren't stupid enough to close their eyes to the risk of unanticipated expenses.

Sure. You'll have your crackheads who're literally down at zero. But even ghetto trash usually don't have more money invested in the golden chains around their necks than in their bank accounts.

Originally posted by Astner
Notice the comme il faut use of the term "normal." I can imagine it being more difficult to uphold in the U.S. -- without universal- healthcare, and education --, however, normal people aren't stupid enough to close their eyes to the risk of unanticipated expenses.

Canada, which falls well into your "normal" category, has so many people living paycheque to paycheque that if interest rates in the nation rise half a percent, some tens of thousands of people face imminent bankruptcy (at least back in 2005ish, can't imagine it is much better now).

These aren't just the poor.

Oh, also, the Scandinavian nations also face massive levels of debt, often in the upper classes, who, according to your game-theory-economic-models, should be the least likely to be in debt:

Norway:

http://www.ssb.no/ifformue_en/

Sweden:

http://www.scancomark.se/Market/Swedens-household-debt-mountain-is-decreasing-faster-than-expected-but-it-should-fall-faste.html

Finland:

http://www.stat.fi/til/velk/2011/velk_2011_2012-06-27_tie_001_en.html

Like with any analysis of human behaviour, we find, again, that "normality" is incredibly rare.

Originally posted by Omega Vision
Big-C isn't Russian.

Are you defining "normal" as "the population of the Nordic countries"?

Granted the people I do socialize with frequently in real life do live in Sweden but I have a broad contact network online as well, with people who I've never met in real life yet, we still converse and exchange favors from time to time.

To summarize, I do think I have a very down-to-earth perspective.

Your faith in "normal" people is laudable, Astner

His definition of normal people is laughable though.

Originally posted by Astner
To summarize, I do think I have a very down-to-earth perspective.

In which Western or industrialized nation do you think average household savings, as a percentage of earnings, would be a positive number?

EDIT:

hahaha, my chart actually answers my own questions...

should have read that Y-axis, whoopsies!

The more you make the greater loans you can take, that's obvious. The reverse of what you're implying -- the banks owing more money than they make -- would ruin the purpose of such an establishment to begin with.

Then you have separate loans people take to buy houses and they only pay off the interest of that loan, much like paying an apartment rent. Even if they could afford the house they still take the loan because they want to invest or spend some of their money elsewhere.

Then there are other instances. My father has a student loan debt that he'll never pay off, even though he does have enough money to pay it off tomorrow if he so chooses to. Because it's cheaper to pay off the interest of that loan.

Conclusively, Oliver North, you missed the point. Just because people take loans doesn't necessarily mean that they don't have the money or could eventually save up for it.