Inflation steadily grows worse (were does premium bikes fit in?)

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raggedtrousers
Posts: 416
Joined: Wed Dec 09, 2020 9:29 pm

by raggedtrousers

A general economic downturn affects discretionary spending: that's pretty much a given. However, as others have noted, the ones who get hit the hardest (and thus need to tighten their belts the most) are the least well off. Conversely, the top few % are often largely insulated from these declines, and (as someone pointed out) look to increase their investments in long-term-safe-but-currently-cheaper assets: property in the UK is a current case in point - now is the best time to be a cash buyer in 15 years, and early next year is likely to be even better.

As far as higher-end bikes go, what's notable here in the UK is we're seeing some quite deep discounting for the first time in 3 years, with some discounts of 20, 25, or even 30% being advertised. Some LBS are also looking to offload older models at even more of a discount than that through ebay backchannels (to avoid manufacturer repercussions: I'm aware of one dealer not far from me selling off some stock at cost right now via this method). If you're after a new bike, can pay cash, and want high end but not halo, now is a very good time.

I've also noticed shifting stuff via FB marketplace and the classifieds on UK forums has got noticeably harder.

Where the industry goes in general is harder to say. I'm not sure I can see the costs of the mid-range bike continuing to increase in the ssame way. I likewise wonder if Rival AXS and 105 Di2 will disincentivise people to move further up the product latter, as the benefits of doing so are marginal. We may also see RRP start to become less relevant.

But I can't see the days of a 2nd tier carbon frame, 2nd tier groupset and good wheels at a package price of around a month's average wages coming back.

froze
Posts: 430
Joined: Thu Aug 05, 2010 3:47 am

by froze

LanceLegstrong wrote:
Sat Oct 15, 2022 1:30 am
Andrew69 wrote:
Fri Oct 14, 2022 11:23 pm
inflation in the US is at 40 year highs...but corporate profits are at 50 year highs!
So much of the inflation is being casued by increasing corporate margins
Corporate greed. Fixed it for you. This is the problem. They keep calling it inflation but if every industry is posting record profits, it's not inflation, it's greed. Bike prices go up, people buy them. Why would they stop?


Correct; add on top of that products that we could buy 30 plus years ago would last a lot longer than they do today, so we are in constant need of buying the same product over and over and over. Appliances used to last 30 years, today maybe 12 years! My Samjunk $2,700 fridge is a piece of junk, we've had it for now 8 years, but right after the warranty expired it started to freeze up in the fridge part, I called a repair person and found out there is no fix for it, plus found out there is a class action lawsuit on almost ALL of their fridges for the same problem, yet Consumer Reports rates them as the best fridges to get? LMAO!! I now have to manually defrost that fridge about once every 2 months, I'm only keeping it to get the settlement. At the same time we bought that we bought Samjunk washer and dryer, the washer failed once under warranty and 3 times outside of the warranty, the 4th time it failed, 4 years after purchase, it was going to cost $600 to fix it, no way, so we got a Speed Queen instead; the dryer failed once outside of warranty, it's still working. I have a lot of such examples. Compare the length of time my Maytag fridge and washer and dryer lasted, they were still working when we moved out of our last house, and they were ran for 32 years. Even the new cell phones are now made so the rechargeable battery is no longer replaceable.

by Weenie


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IvanBladeus
Posts: 6
Joined: Thu Jul 28, 2022 8:11 pm

by IvanBladeus

raggedtrousers wrote:
Mon Nov 21, 2022 10:23 pm
A general economic downturn affects discretionary spending: that's pretty much a given. However, as others have noted, the ones who get hit the hardest (and thus need to tighten their belts the most) are the least well off. Conversely, the top few % are often largely insulated from these declines, and (as someone pointed out) look to increase their investments in long-term-safe-but-currently-cheaper assets: property in the UK is a current case in point - now is the best time to be a cash buyer in 15 years, and early next year is likely to be even better.

As far as higher-end bikes go, what's notable here in the UK is we're seeing some quite deep discounting for the first time in 3 years, with some discounts of 20, 25, or even 30% being advertised. Some LBS are also looking to offload older models at even more of a discount than that through ebay backchannels (to avoid manufacturer repercussions: I'm aware of one dealer not far from me selling off some stock at cost right now via this method). If you're after a new bike, can pay cash, and want high end but not halo, now is a very good time.

I've also noticed shifting stuff via FB marketplace and the classifieds on UK forums has got noticeably harder.

Where the industry goes in general is harder to say. I'm not sure I can see the costs of the mid-range bike continuing to increase in the ssame way. I likewise wonder if Rival AXS and 105 Di2 will disincentivise people to move further up the product latter, as the benefits of doing so are marginal. We may also see RRP start to become less relevant.

But I can't see the days of a 2nd tier carbon frame, 2nd tier groupset and good wheels at a package price of around a month's average wages coming back.
Marketplaces on FB or Amazon or Ebay are for real hard to operate. Therefore, I would recommend you to build your own online marketplace and "close the deal" with disadvantages on other resources. Who knows, maybe you will become our savior then? :D

Anyway, I am looking for alternatives of selling my bikes I have.

pmprego
Posts: 2513
Joined: Mon Jan 21, 2019 3:16 pm

by pmprego

raggedtrousers wrote:
Mon Nov 21, 2022 10:23 pm


But I can't see the days of a 2nd tier carbon frame, 2nd tier groupset and good wheels at a package price of around a month's average wages coming back.
I guess it all depends on yours month's average wage :)

(which basically depends on your country of residency)

Ymerej
Posts: 59
Joined: Wed May 29, 2019 11:41 am

by Ymerej

FJB

AJS914
Posts: 5397
Joined: Tue Jan 28, 2014 6:52 pm

by AJS914

My guess is that what bugs a lot of enthusiasts that live on a normal paycheck was that Dura Ace or Super Record used to only cost a small premium over the 2nd tier group and the 2nd tier group was still fantastic.

The bicycle industry finally figured out how to position the top group as a luxury good and now we see shocking prices. Campy Super Record EPS wireless is going to be $5,000 and not include a power meter. Call it $6,000 with a power2max. It's crazy when you can pick up a Sram Rival group for $1200 and the power meter upgrade is $260.

Colnago got bought out and the C68 is now $7,000 retail. The price is shocking for a frameset that wasn't designed or built by Ernesto and is only a name. They clearly would rather sell fewer frames at a higher price and this feeds onto itself. As the frame gets more exclusive, it gets more desireable in the eyes of that type of buyer. Just like a $10K stainless Rolex dive watch. At least, you might be the only person in your town with a C68 if you buy one.

It's the same with marketing different grades of carbon like Specialized Fact 10, 11, 12... They litterally toss in a few different pieces of carbon because it's impossible to make a whole frame out of Hi-Mod carbon and they charge you 40% more for the S-Works label.

I have the money in the bank but I just won't pull the trigger on a $15,000 bike. I just don't care enough anymore.

froze
Posts: 430
Joined: Thu Aug 05, 2010 3:47 am

by froze

Ymerej wrote:
Sun Mar 19, 2023 12:00 am
FJB
Yes, that is the thought, but keep in mind, that this problem started way back with the first Bush, and it has continued through every president up to Biden. The only odd duck out here is Trump, he had to raise the debt because of Covid, but did he? I think we overreacted! I think we should have done nothing but issue free N95 masks, which were superior to the crappy paper mask we got, it would have been far cheaper to issue those masks out and let people continue to work and shop than it was to shut down the entire economy.

We will never know the reason the US did what it did, was it fear? was it a plan to raise the national debt, was Trump in on it, or was he not? It just seems strange to me that all the US has to do is shrink the national government by a lot and return the power to the states and let them handle their own affairs with out fed involvement could have saved us trillions of dollars a year, which is what Reagan tried doing, so why are they not doing that?

While Reagan also raised the national debt by a lot, he never got it bast 51%, which was a very good buffer area to be in where if a major war were to occur we had the ability to absorb the financial hit, now at 131% we do not, if a major war breaks out now, the USA is financially doomed.

China knows this too, which may be why they're pressing toward war with the US to bankrupt us, they have stated that was their goal. They may not be able to defeat us militarily, but they'll win the war by collapsing us and the west financially, and China gets what they've wanted for a long time, to dominate the world currency markets. Due to China's huge industrial base, they will rebound from a war with the USA extremely fast, faster than the US did after WW2 even.

The idea that a U.S. and China war will be avoided is a theory based largely on their strong economic relationship, however, this theory is deeply flawed both historically and logically. Strong economic partners have gone to war in the past, most notably in WWI, when Britain and Germany fought on opposite sides despite being each other’s largest trading partners. The fact that the Chinese and American homelands are separated by the largest body of water in the world is enormously important in reducing their conflict potential if history is any guide at least. But despite all of that, it appears we're heading toward a clash, or that could be just a front being put on by both sides.

Even without a war, the US, and the west, could collapse under the mountain of debt we have, I believe we're heading into a depression that will make the Great Depression look like nothing, and I think we're at that door, I hope I'm wrong. But unemployment levels are up to the level of where it was during the Great Depression, inflation is near double digits.

A business management consulting firm, ITR Economics, says "it sees a second Great Depression coming just in time for the 100th anniversary of the first Great Depression. A high probability exists that the decade spanning 2030–2040 will be one of lost opportunities, great economic distress, lost fortunes, deep regrets, and despair over what might have been…The trends we see are massive and have so much momentum that they will be difficult to change."

The Biden administration ignores the fact that America’s increasing gas prices have a simple solution. In interviews with The Epoch Times and Fox News, oil billionaire John Catsimatidis said, “We have 100 years’ worth of oil in the U.S. Let the government open up the spigots and the price of crude oil will come back down to $55, $60, maybe $65. Meanwhile, the president wants to fly to Saudi Arabia and beg the Saudi Arabians to give us another half a million barrels at $120 a barrel…It makes no sense…You know what the cost has been to the American people because of the rising gas prices—the cost of the rising food prices—it’s going to go even higher with $120 oil.” And all of that because the Biden left gang wants to wean us off of fossil fuel? So destroy the US, destroy the lives of those that live in the US, so we can be off of fossil fuel? That is a great mistake that Biden and the left are making.

treyxt
Posts: 199
Joined: Wed Apr 07, 2021 8:04 pm

by treyxt

Interesting take^^ lol

Just want to point out two things from what you said:
Unemployement rates have been at historic lows since the end of 2021.
Inflation is high, but has been on a steady decline every month since June 2022 (9.1) to Feb 2023 (6.0).
Specialized Tarmac SL7 10r 61cm (Raw Black Carbon) / r9170 Dura-Ace Di2 11sp / Lightbicycle AR46
Cannondale SuperSlice Hi-Mod 58cm (From EF) / r8050 Ultegra Di2 11sp / AeroCoach Ascalon Carbon / AeroCoach AEOX Zephyr

calicyclist
Posts: 92
Joined: Fri Dec 02, 2022 5:54 am

by calicyclist

froze wrote:
Sun Mar 19, 2023 2:20 am
The Biden administration ignores the fact that America’s increasing gas prices have a simple solution. In interviews with The Epoch Times and Fox News, oil billionaire John Catsimatidis said, “We have 100 years’ worth of oil in the U.S. Let the government open up the spigots and the price of crude oil will come back down to $55, $60, maybe $65. Meanwhile, the president wants to fly to Saudi Arabia and beg the Saudi Arabians to give us another half a million barrels at $120 a barrel…It makes no sense…You know what the cost has been to the American people because of the rising gas prices—the cost of the rising food prices—it’s going to go even higher with $120 oil.” And all of that because the Biden left gang wants to wean us off of fossil fuel? So destroy the US, destroy the lives of those that live in the US, so we can be off of fossil fuel? That is a great mistake that Biden and the left are making.
WTF are you talking about? Biden just this week approved a drilling project that will add as much greenhouse gases as the equivalent of 70 new coal-fired power plants.
https://www.theguardian.com/us-news/20 ... gas-biden
Argonaut RM3 | Pivot Trail 429

AJS914
Posts: 5397
Joined: Tue Jan 28, 2014 6:52 pm

by AJS914

This topic has taken a turn to crazy town. Why would the world need $55/barrel oil? What does that have to do with the price of bicycles? I only pay $3.75 for a gallon of fuel right now. It's chump change. If you pay a lot more in your state or country, it's because of your taxes.

In any case, all oil is not the same. The US produces a certain type and the saudi's produce a certain type. The world runs all different grades of oil which get made into different formulations. This is the reason why the US exports some types of oil and imports others.
Last edited by AJS914 on Sun Mar 19, 2023 8:25 pm, edited 1 time in total.

otnemem
Posts: 398
Joined: Fri Jun 28, 2019 7:55 am

by otnemem

High-end bicycles/framesets are, for the most part, Veblen goods. Crisis, recession, inflation hardly make a dent at these levels. It would have to be a crisis of catastrophic proportions for that to be the case.

BenCousins
Posts: 1366
Joined: Thu Apr 23, 2015 11:46 am

by BenCousins

BigBoyND wrote:
Sat Oct 15, 2022 7:03 am
The people who buy bikes for $15k are the same people who have the resources to benefit from crash/boom cycles.

My wealthiest friends are the ones who buy houses and cars highly discounted during each recession cycle. Same goes for investments. Meanwhile the people at the bottom are struggling most during these times.
Indeed. The very high end won't be affected. Lower and middle income people are the ones who suffer in economic downturns. The wealthy generally benefit.

calicyclist
Posts: 92
Joined: Fri Dec 02, 2022 5:54 am

by calicyclist

otnemem wrote:
Sun Mar 19, 2023 12:48 pm
Veblen goods.
Thank you for teaching me a new term. Never heard that one before.
Argonaut RM3 | Pivot Trail 429

pushpush
Posts: 291
Joined: Wed Feb 01, 2023 5:10 am

by pushpush

calicyclist wrote:
Sun Mar 19, 2023 4:44 pm
otnemem wrote:
Sun Mar 19, 2023 12:48 pm
Veblen goods.
Thank you for teaching me a new term. Never heard that one before.
Same.

by Weenie


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pushpush
Posts: 291
Joined: Wed Feb 01, 2023 5:10 am

by pushpush

Amusing to see someone complain about the cost of gas on a bicycle forum. Go ride an overpriced (and underweight) bicycle and be happy!

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