Last week there was a news story stating that trucks outsold cars by the highest margin in five years in October. This is considered a sign that people are starting to spend again. If that is correct then I think it is an indication that people did not learn much from the recession.
Some people do actually need trucks for work or other reasons but my guess is that the vast majority of the people who own trucks do not actually need them. The fact that so many people are splurging on an unnecessary item might indicate that many people are going back to their free spending ways. It seems people have forgotten the high gas prices of just a few years ago. Gas prices will go up again but it seems that many people are in denial of that fact. Buying a new truck that you don’t actually need is not a financially or ecologically smart decision in my opinion.
The article states that personal savings rates decreased from a yearly high of 6.4 percent in June to 5.3 percent in September. Even at 6.4 percent personal savings rates were well below historical highs. I’m sure some people have learned to be more frugal due to the recession but my guess is that most people will ditch frugality as soon as they feel confident about the economy. What do you think?
Trucks wear out and MUST be replaced. Especially American trucks.
Cars can be kept on life-support for many years past normal retirement age.
As for whether truck purchases are sound – sorry, but so long as people are using their own money (not cash-for-clunkers), I don’t see why its my business to judge their choice of transportation or energy-consumption habits. Sure, I’d rather everyone rode a bicycle, but forcing them to do so is un-American. Better just to let gas rise naturally to $5, 6, 10 / gallon, as it will, and folks will come around. Meanwhile, hopefully, we’ll collectively agree on one or two replacements for motor fuel that are renewable in massive quantity. Hint: Corn-ethanol ain’t it.
As for people not being frugal, I’m ok with that. Let them spend. Just don’t let them borrow and stick me, or my grandchildren, with the bill.
I’m not advocating taking away people’s choices of transportation, I’m just wishing they would choose wiser.
I think we as a country often tend to forget really really quickly. Next time gas spikes we’ll see the exact same thing happen!
You are right. When the gas price goes up all the people with poor gas mileage vehicles will be complaining but I won’t feel sorry for them.