Why are road and TT bikes so expensive?
#51
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Just to muddy the waters more, "afford" has two entirely distinct definitions. Just to use the other one, if I can acquire the bike now, I can now afford myself of its virtues. If I have to defer the purchase until I can make payment in full, I may be delayed in affording myself of its virtues and may not be able to acquire it until I'm too old to fully make use of those virtues.
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Did I say they were? Point is still that you and BoraxKid are using the word differently and have been going around in circles doing so. I just threw that in to point out that linguistic issues are complicated and the use of words can have nuanced differences.
Seriously, you're in the umpteenth post on a "half full/half empty" debate. I just got annoyed because of the blatant misuse of economic concepts.
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Did I say they were? Point is still that you and BoraxKid are using the word differently and have been going around in circles doing so. I just threw that in to point out that linguistic issues are complicated and the use of words can have nuanced differences.
Going around in circles? I have made two posts in response to BoraxKid in this thread.
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So I went to the dictionary, or at least the online equivalent of it. Here's how it (Merriam-Webster) defines "Affordable":Which really doesn't definitively fall down on either side of the tastes great/less filling "financing makes things affordable/no it doesn't" argument. If you define "able to be afforded" as " can afford to make this payment every month for the life of the loan", then, yeah financing makes it "affordable". It doesn't make you more able to pay the full price up front, so arguably it DOESN'T make it "able to be afforded", and with the exception of situations where the rate of interest is below the rate of inflation, financing will make the item more expensive in real terms.
Personally, I don't believe in financing something that will likely be or become worth less than what I'd owe on it. That way, madness lies. And I wouldn't ever see a bike as an "investment", unless we're talking about a collectible, and even then, collectibles are risky investments. Then again, I already have several bikes and none of them were financed.
Personally, I don't believe in financing something that will likely be or become worth less than what I'd owe on it. That way, madness lies. And I wouldn't ever see a bike as an "investment", unless we're talking about a collectible, and even then, collectibles are risky investments. Then again, I already have several bikes and none of them were financed.
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As I recall, you stated that the word "'afford' has two entirely distinct definitions". You just agreed that one of those definitions is not being used in this discussion. That seems to imply that we are therefore using the same definition of the word in this discussion.
Going around in circles? I have made two posts in response to BoraxKid in this thread.
Going around in circles? I have made two posts in response to BoraxKid in this thread.
Fun example of the complexities of language--"you" in my post is actually plural. There's multiple posts in this thread making the exact same point as your two, again and again.
For what it's worth, I buy my bikes with a credit card and pay it off immediately so I get the cash reward or points or whatever.
I also have never spent anywhere near $3000 on a bike, and have no particular desire to do so since I tend to favor the 1990s time machines.
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So I went to the dictionary, or at least the online equivalent of it. Here's how it (Merriam-Webster) defines "Affordable":Which really doesn't definitively fall down on either side of the tastes great/less filling "financing makes things affordable/no it doesn't" argument. If you define "able to be afforded" as " can afford to make this payment every month for the life of the loan", then, yeah financing makes it "affordable". It doesn't make you more able to pay the full price up front, so arguably it DOESN'T make it "able to be afforded", and with the exception of situations where the rate of interest is below the rate of inflation, financing will make the item more expensive in real terms.
Personally, I don't believe in financing something that will likely be or become worth less than what I'd owe on it. That way, madness lies. And I wouldn't ever see a bike as an "investment", unless we're talking about a collectible, and even then, collectibles are risky investments. Then again, I already have several bikes and none of them were financed.
Personally, I don't believe in financing something that will likely be or become worth less than what I'd owe on it. That way, madness lies. And I wouldn't ever see a bike as an "investment", unless we're talking about a collectible, and even then, collectibles are risky investments. Then again, I already have several bikes and none of them were financed.
Honest question, do you pay cash for your cars? The whole industry is built on that type of financing. Not sure madness lies that way for everything.
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As I recall, you stated that the word "'afford' has two entirely distinct definitions". You just agreed that one of those definitions is not being used in this discussion. That seems to imply that we are therefore using the same definition of the word in this discussion.
The dictionary definition just isn't subtle enough or long enough to capture that contrast.
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But I think you misunderstand me. If you put down a large enough payment that what you owe is always less than the car's current value, especially if you get a good interest rate, that's not madness. 100% financing? THAT'S nuts.
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Last car I bought, in 2014, I sold some stock options for half of it, and financed the rest, then last year sold the options I WOULD HAVE had to sell to cover the full price in 2014 for 1.5x as much as per share as they were worth in 2014.
But I think you misunderstand me. If you put down a large enough payment that what you owe is always less than the car's current value, especially if you get a good interest rate, that's not madness. 100% financing? THAT'S nuts.
But I think you misunderstand me. If you put down a large enough payment that what you owe is always less than the car's current value, especially if you get a good interest rate, that's not madness. 100% financing? THAT'S nuts.
Depends on the amount, 100% of what? What's the repayment term? Also, it makes a lot of sense to finance 100% of a service if you need it now but can't get the money to pay for it if you don't get the service. Obvious example--your bank account is empty, and you need to get your car fixed to get to work.
But more often than not, I'd agree with you. The overfinanced car is a real financial burden.
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Depends on the amount, 100% of what? What's the repayment term? Also, it makes a lot of sense to finance 100% of a service if you need it now but can't get the money to pay for it if you don't get the service. Obvious example--your bank account is empty, and you need to get your car fixed to get to work.
But more often than not, I'd agree with you. The overfinanced car is a real financial burden.
But more often than not, I'd agree with you. The overfinanced car is a real financial burden.
Regarding financing service? That's a different matter. That goes to the question of the OVERALL affordability of a vehicle - if you can afford to buy it, but not service it without borrowing, you've got a problem.
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So I went to the dictionary, or at least the online equivalent of it. Here's how it (Merriam-Webster) defines "Affordable":Which really doesn't definitively fall down on either side of the tastes great/less filling "financing makes things affordable/no it doesn't" argument. If you define "able to be afforded" as " can afford to make this payment every month for the life of the loan", then, yeah financing makes it "affordable". It doesn't make you more able to pay the full price up front, so arguably it DOESN'T make it "able to be afforded", and with the exception of situations where the rate of interest is below the rate of inflation, financing will make the item more expensive in real terms.
Personally, I don't believe in financing something that will likely be or become worth less than what I'd owe on it. That way, madness lies. And I wouldn't ever see a bike as an "investment", unless we're talking about a collectible, and even then, collectibles are risky investments. Then again, I already have several bikes and none of them were financed.
Personally, I don't believe in financing something that will likely be or become worth less than what I'd owe on it. That way, madness lies. And I wouldn't ever see a bike as an "investment", unless we're talking about a collectible, and even then, collectibles are risky investments. Then again, I already have several bikes and none of them were financed.
So, the first definition of "afford" is "have enough money to pay for." To go back to the same well again, in the absence of financing, I might not have enough money to be able to pay for a bicycle. With financing, suddenly I do have enough money to pay for the bicycle. Therefore, financing makes the bike more affordable (albeit with the aid of borrowed money).
I think a few older people in this thread are hung up on the fact that when I use financing, I am temporarily borrowing money in order to make the purchase affordable. Their old-world views tell them that using credit is always bad, and they ignore several important points about why using financing can be a great idea, especially when the purchaser has motivation to hold onto their cash instead of significantly reducing their reserves. When used correctly, credit lets you keep your cash and enjoy and make use of what makes you happy today, all for the small premium of a nominal interest charge. Worrying about the few dollars per month of interest charges on an Affirm loan seems silly, given all the benefits provided by taking the loan in the first place.
To put this in real-world context: we are in the middle of a pandemic. I would much rather use the financial strategy that lets me keep my cash, in case calamity strikes. If I have cash, I can still buy necessities and pay rent. If I trade my cash for a bicycle, then I will have that much less cash to help in the event of misfortune. It's really a no-brainer why someone would choose financing in today's market.
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I think a few older people in this thread are hung up on the fact that when I use financing, I am temporarily borrowing money in order to make the purchase affordable. Their old-world views tell them that using credit is always bad, and they ignore several important points about why using financing can be a great idea, especially when the purchaser has motivation to hold onto their cash instead of significantly reducing their reserves. When used correctly, credit lets you keep your cash and enjoy and make use of what makes you happy today, all for the small premium of a nominal interest charge. Worrying about the few dollars per month of interest charges on an Affirm loan seems silly, given all the benefits provided by taking the loan in the first place.
Maybe I am old (or just old-fashioned), but if I had to borrow money to buy a new bike, I wouldn't buy it. But then, maybe us old folks were raised to understand something called "deferred gratification."
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Eh? What's that, sonny? Speak into my hearing aid! Speak up! Wait a minute...You're saying that you use financing in order to get something that you couldn't otherwise get? Whoa! Thanks for explaining that to me! After buying (and financing, to varying degrees) four houses over the past 25 years, I had NO IDEA that that is how financing works!
Maybe I am old (or just old-fashioned), but if I had to borrow money to buy a new bike, I wouldn't buy it. But then, maybe us old folks were raised to understand something called "deferred gratification."
Maybe I am old (or just old-fashioned), but if I had to borrow money to buy a new bike, I wouldn't buy it. But then, maybe us old folks were raised to understand something called "deferred gratification."
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100 percent of the purchase price. That's generally what "100% Financing" means - no money down, no equity. You start off in the hole because as soon as you drive the car off the lot, you're thousands of dollars in the hole, because it's ALREADY worth less than you owe.
Regarding financing service? That's a different matter. That goes to the question of the OVERALL affordability of a vehicle - if you can afford to buy it, but not service it without borrowing, you've got a problem.
Regarding financing service? That's a different matter. That goes to the question of the OVERALL affordability of a vehicle - if you can afford to buy it, but not service it without borrowing, you've got a problem.
I understand what 100% financing means, I'm just saying that if it's not an expensive car and the loan relatively short term, that risk may be rather small.
Last edited by livedarklions; 09-17-20 at 02:24 PM.
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After buying (and financing, to varying degrees) four houses over the past 25 years, I had NO IDEA that that is how financing works!
Maybe I am old (or just old-fashioned), but if I had to borrow money to buy a new bike, I wouldn't buy it. But then, maybe us old folks were raised to understand something called "deferred gratification."
Maybe I am old (or just old-fashioned), but if I had to borrow money to buy a new bike, I wouldn't buy it. But then, maybe us old folks were raised to understand something called "deferred gratification."
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Anyone else finding this thread absolutely hilarious?
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Now you've done it! We're going to hear about real estate being an investment while bikes are not. After all, who can forget the catastrophic bicycle credit collapse of 2008?
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This thread saddens me, because either many of the posters will one day feel deeply embarrassed by the ridiculous posts they made debating imaginary points .... or they will never enlighten enough to feel that embarrassment.
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If you don't understand the difference, I'm not sure I can help you understand.
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When used correctly, credit lets you keep your cash and enjoy and make use of what makes you happy today, all for the small premium of a nominal interest charge. Worrying about the few dollars per month of interest charges on an Affirm loan seems silly, given all the benefits provided by taking the loan in the first place..