The Economy & You: What's Happening?

[Marty Loken (Norseboater)]

I remember a time, not long ago, when some folks over on the main board of FiberGlassics were wringing their hands over how the price of classic-glass project boats was going through the ceiling, maybe being driven out of reach of the average person who wanted to find an affordable classic to restore. Maybe classic-glass boats were becoming too mainstream, too collectible, too hyper-inflated in value, some folks worried...and maybe groups like FiberGlassics were helping to artificially drive boat prices into the stratosphere...?

That was then. This is now: You can still find free boats in the blackberries, and--have you noticed?--it's gotten hard to find genuine cash buyers for even the more collectible glassics.

The apparent reason is The Economy, which people can't stop talking about...but is that the only reason--or even the primary reason--why good boats aren't selling well these days?

I'm just curious about your personal views as members of Northwest Classic Boat Club: How has The Economy directly affected you in recent years, including choices you might make about taking on a boat project; including the time you have (or not) for recreational boating; and including the amount of jeopardy you personally feel in the current economic mess...?

I'll be happy to start the conversation by saying that we seem to be working harder every year just to keep treading water--barely able to pay the bills, and meanwhile watching as supplies we use get more expensive, in some cases harder to find...and we don't dare increase prices for services or anything else.

I've noticed a dramatic difference in the marketplace for vintage boats. While investing into a classic boat is obviously a good idea mid- to long-term, right now the public seems reluctant to invest in anything, period. It took me something like 9 months to sell the rare and seemingly very collectible 1959 Bell Boy 21 express project...and during the process I ended up gutting the price to the point where I was losing quite a bit on my investment. But I needed the storage space and it had to go.

In recent days I've listed six different project boats in the adjoining NWCBC Classified section, some for giveaway prices...especially considering their relative rarity and general desirability as models, and/or work already done on them. Not a call, not an e-mail...absolutely no response from anyone. I'm not deeply shocked, having been through this on craigslist over the past year, but the eerie silence suggests other questions.

* Are you, as a member of NWCBC, already "up to here" with boats and/or boat projects, or maybe in a holding pattern because of The Economy...or for other reasons?

* Are you only interested in project boats if they're literally free?

* Can you describe how The Economy has personally affected you and your family?

I'm just curious about how everyone's doing out there; how you personally judge the market for old boats; and whether you see a light at the end of the proverbial tunnel--or just a train coming in the opposite direction?

Maybe we can have a little conversation here on the general subject(s)...?

Thanks,

- Marty

[RJY007]

The more boats, the better...

So I'll throw in my two cents. I love the classic boats and our members have some beautiful examples....but I no longer have to possess everything I see. Seems as I get older, I've become more risk adverse and more selective in collecting...e.g., boats, antique motors, old radios. In earlier days, it was collect as many nautical things as possible, and run the heck out of them whether they were seaworthy or not....like big smoke belching overpowered outboards on little fishing boats (Oh, the stories your friend Dennie Johnson could tell you).

Anyway 3 boats and a 40 ft trawler keep me busy but I thoroughly enjoy the stories here of 'blackberry finds' and restoration projects and hopefully I'll be invited to go for a ride in some of them.

Cheers,,,,

[timw]

Good Morning...

Jeez Marty, All of us over here on the east side hardly even notice the bad economy, as we all live on the edge of poverty anyway....But seriously, I think folks over are just hunkering down with what saving they have, kinda leery about spending, until the fog lifts..Thats my 2 cents worth..Better days are coming again....
Tim

[McSkagit Tim Jones]

The economy and the boating market

Posted a thread in the floatsam & jetsam section about trying to sell my Glasply on Craigs and the weirdo's that respond. Boats are in the realm of non-essentials and most people are just spending on essentials. The Saratogan project has to be completed so that I can get out of the shop rent which is breaking me.

My dad who is 96 always told me that there was going to be another depression (like 1929). Beginning to think he was right. The economic turmoil didn't happen overnight. Been brewing for years. Going to take years to correct. Down side is that due to all the $$$ being pumped in from above, we are in for some serious inflation. What is going down in Washington DC now is very similar to the situation in Germany in 1921.

Below is a mini-history of Germany's hyperinflation (1922-23) I found on the US Postal service stamp collecting site.

Better batten down the hatches. We're in for some rough weather......

McSkagit

One of the joys of stamp collecting is developing an understanding of the historical context in which the stamps we collect were issued. A fantasic area for such a study is the period of German inflation of 1922 - 1923 and the German postage stamps that were issued during that time. The economy was in such a shambles, that the inflationary situation is sometimes described by economists as hyperinflation.

The roots of the inflation of 1922-1923 in Germany went back to the start of World War I. When the war began, the Reichbank suspended redemption of notes in gold, which meant that there was no limit to the number of paper notes it could print. During the war the government incurred a large debt. The Germans hoped to win the war and have the defeated nations pay off this debt. Instead, Germany lost the war and they were faced not only with this debt but with the severe and unrealistic War Reparations imposed on Germany by the Allies.

The German government tried to solve its budgetary deficits by printing more money. The value of the mark began to fall. By late 1923, 2000 presses were running 24 hours a day turning out currency. People seeing the value of their money plummet, spent it as fast as they could, trying to exchange it for goods so as to get some use out of it before it was totally worthless.

Workers were paid more than once a day, and given time off during the day, so that they could spend the money before the value disappeared. However, wages just couldn’t keep pace with inflating prices. In November of 1923 a loaf of bread cost 200 billion marks. People were hungry. City markets were empty. Farmers didn’t want to exchange the food they raised for worthless paper marks.

The German economy was saved from this hyperinflation by Germany’s new chancellor, Gustav Stresemann who replaced the mark with the Rentenmark which was backed with American gold. The American government also helped. It loaned Germany $200 million and in 1924, Charles Dawes, an American, developed the Dawes Plan. This plan set realistic targets for German reparation payments. It was not long before the German economy was back in balance.

Stamp collectors can track the snowballing German inflation by examining postage stamps that were issued during this period.

The basic letter rate on January 1, 1922 was 2 marks. By September 1, 1923 it was 75,000 marks. The post office could not design new stamps fast enough to keep up with this inflation. It resorted to overprinting new, higher values on old dies.

There were almost 200 varieties of stamps issued during the period from 1921 to 1923. Collecting them all can be quite the challenge. The good news is that the stamps of this era remain very affordable. For a modest investment, here is an opportunity to develop a real conversation piece for your collection.

[Stephen Tweit]

The economy and boats

Marty... For me its the no more space issue. I have seen a few boats I would like to have reciently, but I have no room.. Its hard to justify $ 150 a month storeage for a $300 boat. Especially to the Admiral. I guess I sjhould move to the "country". Steve

Marty
In my case the economy is not the issue. I have the advantage of being able to do a lot of things myself and a fully equipped shop to do it in. Also, I never have a lot of money to spend on things so no change there. I watched the 21ft Bell Boy myself wishing I had room for it but there comes a point where too many projects catches up with age and how many I'll have time for before I can't do this any more. I know other boats will come up that I'd love to have (I can think of two right now) but I need the stick with the three I have until they are completed. Barry

...wake up call

As someone who has just recently caught the vintage boat bug, it is painful to see so many great old classic projects at firesale prices and seemingly no takers. Enthusiast sites such as this one and FG when coupled with the unprecedented reach of Craigslist, simplify the process of collecting projects to unsustainable levels. The three "must have" early fiberglass boats that I have collected in a year will see the water in a great year (realistically) no more than 10 times... hardly worth the pain of storage, or strain on personal relationships.

All politics aside, I'm betting that all of us are rethinking our priorities making the supposed "investment" in nonessentials seem as misguided as six-figure Wall Street bonuses.... if we have diluted (perhaps deluded would be more appropriate) our restoration energy, time and dollars between six boats when will any of them be ready to hit the water? I challenge myself and all but a few members here to question why they don't have one good reliable runner to use in the Opening Day Parade, rather than the six piles of junk in various states of preparedness. We can't save all of them from ruin, but we can keep the prime examples alive for everybody to enjoy. Please spend your limited recreation dollars to get your projects completed by either yourself or a professional....besides they look better on the water!!

[Karl]

Marty:

I agree with your thought process regarding the economy and old FG boats.

I was in the hunt for the BBoy 21 and for the sake of my marriage I drop out. The crux of the matter was that although I am thankfully still employeed, I now have furlough days, cost of living increases pulled back, and health care costs increased. So, yes the economy has affected my further exploration into increasing the herd.

I don't think that the initial price point is as important as (with some experiance) the fact that it always costs 2 or 3 times as much at you think it will to get them the way you want them.

With all of that being said, I'm still going to buy a lotto ticket, look at this website, the FGlassics website and dream of what could be!

Karl

[Steve_Kiesel]

* Are you, as a member of NWCBC, already "up to here" with boats and/or boat projects, or maybe in a holding pattern because of The Economy...or for other reasons?

* Are you only interested in project boats if they're literally free?

* Can you describe how The Economy has personally affected you and your family?

I'm just curious about how everyone's doing out there; how you personally judge the market for old boats; and whether you see a light at the end of the proverbial tunnel--or just a train coming in the opposite direction?

Maybe we can have a little conversation here on the general subject(s)...?

Thanks,

- Marty

Marty, here's my situation. I'm trying very hard to get to retirement in two years. At least retiring from my current job at Boeing. My wife and I both still have our jobs, and probably will for the next couple years. The only effect the current economy has had on us is the real estate values, and my 401k. Both are down considerably from a year ago. Regardless of where things are in two years, I'll still retire. But will have to adjust my plans to fit the financial situation.

As far as project boats, I would love to have half a dozen. But I don't have any place to keep them, which means storage costs, besides the cost of acquiring and restoring them. So for now, I have to stick with my one boat. Still have a lot that needs to be done to it, all small upgrades, but they still require time and money. Plus I have several other hobbies/recreations that take time and money.

I've also been trying to unload some things. Last spring I listed my gold dredge on Craigslist. Got a lot of response, but they all wanted to horse trade. I started listing it again about a month ago. Not many bites at all. Finally sold it a couple days ago to a fellow in Minnesota. That was only after a heavy discount. Same thing with other items I'm trying to sell ranging from just over $100 to $2000. So it's not just boats.

I believe it's the economy. There a lot of people out of work, and those that are not out of work, are being very selective on how they spend their dollars.

[Nomad55]

* Are you, as a member of NWCBC, already "up to here" with boats and/or boat projects, or maybe in a holding pattern because of The Economy...or for other reasons?

We have flat out run out of places to stuff any more boats as I posted in another thread.I even offered to reduce the rent on one of the rentals to be able to slide the Skagit under cover. Also, for the time being, we are working on our 1955 Nomad so must divide our time between boats and the car. We plan to sell the '34 this spring to free up space and $$$$. We also have a "49 F4 1ton flatbed project truck I will be selling ,reluctantly, for some extra parking.

* Are you only interested in project boats if they're literally free

No, for me it just has to have the "look" and that is what got me back into boating. I had always wanted a wooden runabout but couldn't justify the cash outlay. Then I saw an old Westerner and througth researching that boat I found FG and FGNW and the rest is history. Also see above.



* Can you describe how The Economy has personally affected you and your family?
Mary retired from her job last July,she is now looking at a loan processing position she has been offered.We took a big hit on a rental that required nearly 10K to repair after the tenants moved out. The $500 damage deposit was used up within 10 feet of entering the front door. I took on a challenge to raise the efficiency of a bottle room for a friend and of course to feed my new addiction and they foot the bill for our health ins.
I like to travel but will be staying close to home this year but the upside of that is more boating for us this year.

[Mark_Denis]

Marty, I think you're right. A lot of people are playing it safe right now until things improve with the economy.

There was a lot of uncertainty last year and even though I have a relatively stable job I chose to play it safe. I was eyeing the BB21 from the day you posted it 9 months ago and held off for just that reason. I think the majority of people are still nervous about investing in non-essential things.

I work in the seafood industry and when the economy tanked it had a huge effect on everyone in our industry. Many people stopped or drastically reduced going out to eat and spending extra money for premium seafood products at the grocery store. It was getting so bad many of our customers (large seafood corporations) put a freeze on non-essential projects. Some companies went out of business.

There are signs that things are improving though. I am seeing many of our customers starting to get back to business as usual. This means more people are going out and spending money again. I know its only one industry but hopefully it’s an indicator that things are stabilizing.

Personally, I think now is a great time to invest if you can. My bet is the great deals you are seeing out in the marketplace right now won't be around for long. If you're in the market for a classic boat now is the time to buy.

Marty, I almost feel guilty getting the BB21 at the low price you sold it for. I'm glad though that you will be getting the majority of the business for its restoration.

Great topic, it's interesting to hear everyone’s take on what going on out there right now.

Mark

[John Berg]

Its the weather

Marty, Although I have taken a 70% hit on my income( I put realestate signs up for agents), Its been a cold, wet, and frozen winter. It has really sucked the fun out of going outside. I finally started getting boats cleaned up last week and cant wait to get on the water this week for some clam diggen and soaking in some sun. I dont have any money but its not that expensive to run to my diggen spot. If I get caught that will be a different story. Seeing that those who think they are the boss of me closed my spot. I have to be quick. Enjoy the sun. John

[Marty Loken (Norseboater)]

Fascinating responses

It's really interesting to hear all of the different stories, and perspectives. We're all affected differently--or not--by what's going on in the global economy...mostly in a negative way. But at least, no matter what, we live in an amazing region, and when we can afford to get out in our old boats, it just doesn't get much better than the Pacific Northwest.

The other nice thing is that virtually all of our classic boats are far more affordable than most any piece of junk you can buy new at the Boat Show.

- Marty

[Tim McCrain]

Marty,
As far as boats, right now I'm having a hard time finding enough time away from work to finish painting my Homelite and mount it on the Sabrecraft, and taking on any more projects is out of the question. I hope to be on the water before July. Not to mention that right now I have no room for any more boats. We have to live in the city for a couple more years and then the plan is to move out onto an acre or two, where I'll have room for a shop and projects. My '56 Del Mar is in a storage yard and will have to stay there until we move and I have room for it. At least it isn't in the driveway where I have to look at it through the window while I'm chained to my desk.

As for the economy, I am fortunate enough to be really busy right now. Been working long days 6-7 days a week for months and will continue to do so as long as the work is there, as I don't expect this to last forever. I wanted to make the safety class but had to work, wanted to make opening day but will have to work, etc. Hopefully I'll get some boating time before the summer is over ...

[GregJ]

Marty,
I have pretty much had the attitude that one boat at a time is enough, that way I can use all my resources for it alone. I feel that the Skagit 17 Express is versatile enough for the lakes and the sound , I'm well protected in bad weather and it does well in rough water. It's comfortable for two for overnighting. It has been a great all around mini cruiser so why get another boat.
The economy has effected me some what but not to much. I am semi retired now with plans on retiring completely this Oct.. My 401k has taken a pretty big hit but is slowly recovering so I might stall off retirement for awhile. My boss wants me back full time but after 40 years of dong what I do I won't even consider that. It gives me more time for boating.