OT. The futures Bright, the Futures Brexit!!!

[Andy_Faber]

For the "ordinary folk" to make a difference they would have to eschew the rampant consumerism which they are all to readily eager to embrace, often borrowing money to do so, I read a startling statistic the other day which was that over 85% of new cars are on these personal lease plans, so they never actually own the car and pay upwards of £350 a month for the privilage.

This finance is provided by shadow banks, those big companies who benefit twice, once from the value of the good and then from the finance payments, many think that this is the next economic bubble to burst - the growth in the shadow banking sector which is unregulated and engaged in as risky if not riskier lending practices than the banks did.

So I fear that whilst people are in thrall to consumerism and use endless credit to support their habit they will not be fighting globalisation anytime soon.

My household has three cars on PCP and I'm struggling to understand the issue from a consumer POV. PCP isn't borrowing, its effect is to AVOID borrowing (on the part of the end-user). I paid a deposit out of savings, I make monthly payments out of earnings, I treat the vehicle like a piece of jewellery, I was conservative about the mileage limit so I won't get a penalty, and I have an exit strategy that won't leave me out of pocket

I will agree that 'something has to give' but I'm not sure what, its just a feeling. I thought it would be the bad press about diesels, but my man on the inside says that the increase in tax etc is just being factored in by folk as part of the cost of ownership, which has cushioned the impact somewhat.

[roger_ramjet]

Tend to agree about shadow banks argument but as Andy says some people can leverage the non ownership of assets favourably, and some just gamble their financial probity.

The level of consumer debt in the economy is obscene culminating with the 1000%+ interest rates at Wonga etc. Most of this overpriced debt is spent on multinational made goods BUT if they werent selling it, someone else would. The issue is the insane desire to spend spend spend by people who cannot afford it - not the sellers of the goods: but I will accept there is a chicken and egg aspect to the dynamic between supply and demand.

[swaledale]

My household has three cars on PCP and I'm struggling to understand the issue from a consumer POV. PCP isn't borrowing, its effect is to AVOID borrowing (on the part of the end-user). I paid a deposit out of savings, I make monthly payments out of earnings, I treat the vehicle like a piece of jewellery, I was conservative about the mileage limit so I won't get a penalty, and I have an exit strategy that won't leave me out of pocket

I will agree that 'something has to give' but I'm not sure what, its just a feeling. I thought it would be the bad press about diesels, but my man on the inside says that the increase in tax etc is just being factored in by folk as part of the cost of ownership, which has cushioned the impact somewhat.

The issue is that for many the PCP is just one of many similar debts they carry to finance their life style and a blow to the economy which results in the wages not coming in to service those outgoings would set off a chain reaction as its financially unsustainable.

If your a low mileage person then frankly the economics of a car on a PCp dont make snese, still if one chooses to blow x thousands per year on something one will never own then thats a personal choice - the fact is one years PCP payments will buy a reliable good model car second hand which at say 10,000 miles per annum would last 4 or more years with ease and beyond normal running costs no further costs and a few thousand pounds of ones earnings in the bank.

I do over 25,000 miles per year have run a second hand car which has lasted between 3 and 4 years each time, capital cost per year less than the monthly PCP payment for an equivalent model. But then I'm not a slave to todays consumerist society and will be laughing all the way to the bank when the brexit solids hit the fan.

[Andy_Faber]

The issue is that for many the PCP is just one of many similar debts they carry to finance their life style and a blow to the economy which results in the wages not coming in to service those outgoings would set off a chain reaction as its financially unsustainable.

If your a low mileage person then frankly the economics of a car on a PCp dont make snese, still if one chooses to blow x thousands per year on something one will never own then thats a personal choice - the fact is one years PCP payments will buy a reliable good model car second hand which at say 10,000 miles per annum would last 4 or more years with ease and beyond normal running costs no further costs and a few thousand pounds of ones earnings in the bank.

I do over 25,000 miles per year have run a second hand car which has lasted between 3 and 4 years each time, capital cost per year less than the monthly PCP payment for an equivalent model. But then I'm not a slave to todays consumerist society and will be laughing all the way to the bank when the brexit solids hit the fan.

I respect your approach to motoring and your thrift but PCP is not a debt in the hands of the end user. Damned right I use it (PCP) as a device to service my 'lifestyle' but I'm really struggling to make the other connections you make.

[Ram59]

The issue is that for many the PCP is just one of many similar debts they carry to finance their life style and a blow to the economy which results in the wages not coming in to service those outgoings would set off a chain reaction as its financially unsustainable.

If your a low mileage person then frankly the economics of a car on a PCp dont make snese, still if one chooses to blow x thousands per year on something one will never own then thats a personal choice - the fact is one years PCP payments will buy a reliable good model car second hand which at say 10,000 miles per annum would last 4 or more years with ease and beyond normal running costs no further costs and a few thousand pounds of ones earnings in the bank.

I do over 25,000 miles per year have run a second hand car which has lasted between 3 and 4 years each time, capital cost per year less than the monthly PCP payment for an equivalent model. But then I'm not a slave to todays consumerist society and will be laughing all the way to the bank when the brexit solids hit the fan.

I admire your financial acumen, but surely people should be able to have the choice of how they waste their money, wether it be PCP on a car lasting all year or a skiing holiday lasting one week or a good night out once a week or killing yourself with fags or booze. People enjoy wasting money on many things, what's yours or are you perfect?

[ramAnag]

It’s tricky, take your point Swale but the last car I bought new cost me around £20k and I sold it three years later for just under £10k.
I then entered my first ever PCP deal...better car for just under £300 per month for three years...the difference between the loss on the first and the cost of the the second is negligible and I won’t have the hassle of selling in about four**** months time. ‘You pays your money you makes your choice’.

[roger_ramjet]

Of course its much better simply not to waste money on a car in the first place. If only we had had a government for the last 40+ years that was committed to investing in the public transport infrastructure we would be so much better off as a country, less polluted and less at the mercy of global oil demands. But hey ho, no use crying over spilled milk we just dropped a huge ******* back when we decided the car was the future.

[ramAnag]

Of course its much better simply not to waste money on a car in the first place. If only we had had a government for the last 40+ years that was committed to investing in the public transport infrastructure we would be so much better off as a country, less polluted and less at the mercy of global oil demands. But hey ho, no use crying over spilled milk we just dropped a huge ******* back when we decided the car was the future.

The car continues to be the future Rog. People are too used to travelling in the comfort of their own ‘bubble’ at a temperature they choose, with the entertainment they want and at a time that suits them. They don’t want to have to share their space with Mr and Mrs Smelly/Noisy/Nosy/Large etc at an inconvenient time. The trick is to move to more environmentally friendly power and, the total confusion over modern diesel engines apart, we do seem to be actually making some headway in that respect, over here at least. Unfortunately the Americans, Russians and Chinese seem as far away as ever but that’s what you’ll get from those leaders who deny the existence of climate change.

[roger_ramjet]

The car continues to be the future Rog.

In 1933 the Nazi party seemed to be the future for Germany. Look where that got them.

[ramAnag]

In 1933 the Nazi party seemed to be the future for Germany. Look where that got them.

Odd analogy...although I suppose about the only decent thing Hitler ever did - other than topping himself - was instigating the iconic VW Beetle.
I’m far from being a ‘petrolhead’ but greener fuels and more affordable hybrid vehicles would suggest the convenience of the private car is here to stay.