Happy Mothers Day to those for whom this day is named. This is the 18th Mothers Day without my marvelous mom.
Today also marks 26 weeks that my wonderful wife and I have lived in our Arizona home. Yep, a half year has come and gone.
The wheels of time turn relentlessly.
One might dismiss the remarks of Andrew Bailey, Bank of England Governor, as being those of an old fogy. (By the way, Bailey is 62.) Nevertheless, this is what Bailey recently said about cryptocurrencies like Bitcoin, “They have no intrinsic value. I’m going to say this very bluntly again. Buy them only if you’re prepared to lose all your money.”
Once again, sovereign fiat currency is backed by a nation’s ability to tax and to borrow. Cryptocurrencies are backed by nothing except people’s faith in them.
I also believe that the dramatic rise in the value of many of these “instruments” will be halted by the same event that legitimizes them: governments regulating cryptocurrencies. It is also possible that countries will begin to issue their own digital currencies.
In this article from Classic Cars, Andy Reid (no, not the NFL coach) shares some tips for buying your first collector car. The article is worth reading. I particularly liked this passage:
“Complication does not mean computers, but could mean a non-syncro gearbox, a 2-stroke engine that requires oil to be added to the fuel at each fill up, or expensive service needs.
You may find out that after doing this you don’t really want a classic Hemi Cuda or an MGB but instead want a newer Dodge Challenger Hellcat or a BMW Z4. This is where you need to listen to both your heart and your head.”
Without deep pockets and/or excellent mechanic skills many collector cars will simply be too much to handle for many owners. A relevant passage from Reid’s piece: “However, you also need to understand that, at a fundamental level, no collector car, especially one 25 years old or older, is going to be perfect…This is not the owner hiding anything from you but simply a fact of life with older cars.”
As I have written before, while at this particular moment in time I am not in a position to buy a car like the one shown below, my lack of mechanic skills would also give me pause before purchasing such a vehicle, although in the end my heart might overrule my head.
Yes, this is another picture of a Studebaker Gran Turismo Hawk. If you plan to watch the upcoming Mecum Auction from Indianapolis, pay particular attention to lot F276 (meaning the car will cross the block on Friday, May 21st). I have mentioned this car before and it would be the best of both worlds because it looks like a GT Hawk, but has a modern drivetrain, suspension, brakes, etc. Still, this is where the deep pockets would be relevant assuming I had room for another car.
Dirty Dingus McGee estimated that the car cost at least $100,000 to build and might have a reserve of about $60,000. The latter is simply beyond what I want to spend right now for an automotive “toy.” Of course, I have no place to park it, anyway.
I would very much like to read any thoughts or suggestions you have on buying a collector car, whether or not it would be your first.
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6 thoughts on “Happy Mothers Day 2021”
Happy Mother’s Day to you all.
Owning a classic car and/or restomod is not for the faint of heart. You need either serious mechanical skills or a deep pocket so someone else can maintain your “toy”. A place to park inside is also a requirement. For my F-1 Lightning project, I have enough of both to continue working on it to completion.
I am aware of cryptocurrencies and know very little about them, so I refrain from purchasing any of them. Your description above is enough for me to know they are not for me.
Thanks, Philip. Yes, the faint of heart need not apply for the job of owning a classic and/or restomod. People should respect their limitations.
“Once again, sovereign fiat currency is backed by a nation’s ability to tax and to borrow. Cryptocurrencies are backed by nothing except peoples’ faith in them.”
But sovereign fiat currency is backed by people’s faith in the nation’s ability to tax and to borrow. See the German Papiermark or the Zimbabwean dollar. Print enough greenbacks and keep inflation low enough, and we may need a F-150 to haul the cash to buy a loaf of bread. On the other hand, don’t bet your future on a guy whose baby’s name looks like it was produced by the random walk of a cat across a keyboard.
Sorry, Doc, but I think you’re conflating monetary incompetence and huge exogenous shocks, like war reparations many multiples of GDP, with the normal execution of monetary policy. That governments can tax their citizens is a given (that is actually fiscal policy); their ability to borrow is only marginally less so.
Cryptocurrencies have no intrinsic value, period. That people buy them and bid up their price doesn’t change that state of affairs. Americans bought three million “Pet Rocks.” I think governments will put the hammer down and regulate these “instruments,” which will almost certainly drastically reduce what people will pay for them.
Markets can stay irrational much longer than most people can remain solvent. Digital “money” is coming, but it will almost certainly be heavily regulated by governments and/or governments will issue their own digital currencies.
If everyone listened only to their head and not their heart, NO collector or performance cars would be sold. Luckily, there are those of us who ignore with all their might, the advice of the head. Are we better off than those that only listen to their head? Maybe, maybe not. But I’ll promise we have a heck of a lot more fun.
Amen, DDM, Amen!
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