Rivian going out of business? Should I buy or lease? [LOCKED DUE TO POLITICS]

[Hillbilly]

The “free money” didn’t push up unrest rates. Money has been free since 2008 and interest rates were ludicrously low for almost 15 years. Mortgages were at 2.25% in 2021! The collapse of the supply chain and restrictions on inventory is what drove up inflation, requiring the raising of interest rates.

Inflation can be caused by a number of things, but what's most obvious is the massive increase in deficit spending over the last four years. Rates will need to remain high for an extended period of time to curb consumer demand and bring prices down.

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[Hillbilly]

OK, I'll bite, @Hillbilly -- though I hope we don't drag the thread too far off topic.

Whom would you trust for objective information about the effect of the parties' policies on overall economic performance, not just on EVs?

Best wishes!

No problem, Dave. for the most credible takes, economic schools of thought notwithstanding, I'd defer to peer reviewed economic journals (there are a lot). The American Economic Review would probably would be near the top of most lists.

 

[slomotion16]

Just FYI, my comment had nothing to do with EV incentives. It was related to the construction of a new plant that would lower Rivian's production costs and make them more profitable. I'm not sure I understand what EV incentives had to do with my comments.
However, EV incentives may boost R2 and likely boost R3 sales...a good thing for Rivian's bottom line, particularly if the new plant would produce them at lower costs.

Oh, you mentioned the republicans wanting to "cut back severely on the sales of EVs." I assumed you mean ending incentives.

 

[Hereforthesnacks]

Inflation can be caused by a number of things, but what's most obvious is the massive increase in deficit spending over the last four years. Rates will need to remain high for an extended period of time to curb consumer demand and bring prices down.

I’m sorry but that’s just not true. There was a ton of spending in 2008 and inflation stayed historically low. Not to mention that inflation started to creep up in 2021, which is 3 years ago, meaning that spending “over the last 4 years” cannot be the main cause.

Plus, and really relevant, is the fact that Congress spends the money. So, even if you want to look at the govt as the root cause - which would be incorrect - it would be Congress, not the executive branch. And the spending was one of the very few bipartisan actions.

Finally, rates are widely predicted to be cut in September which belies your point about rates remaining high for an extended period of time.

I’m a facts only person. No agenda here.

 

[Hillbilly]

I’m sorry but that’s just not true. There was a ton of spending in 2008 and inflation stayed historically low. Not to mention that inflation started to creep up in 2021, which is 3 years ago, meaning that spending “over the last 4 years” cannot be the main cause.

Plus, and really relevant, is the fact that Congress spends the money. So, even if you want to look at the govt as the root cause - which would be incorrect - it would be Congress, not the executive branch. And the spending was one of the very few bipartisan actions.

Finally, rates are widely predicted to be cut in September which belies your point about rates remaining high for an extended period of time.

I’m a facts only person. No agenda here.

https://fiscaldata.treasury.gov/americas-finance-guide/national-deficit/

Facts aren't facts just because you say they are. You can source some directly from the government about their spending at the link above (which covers all branches, including the executive). Be sure to take a look at the increase in deficit spending from 2020 on. I'd also bet against a rate cut. In the event there is, it'll be marginal.

Here's another link for you to a congressional research service report from 2021. You'll find that the concerns regarding interest rates and inflation are prescient and prevalent throughout. https://crsreports.congress.gov/product/pdf/R/R46729

 

[Dave Cundiff]

https://fiscaldata.treasury.gov/americas-finance-guide/national-deficit/

Facts aren't facts just because you say they are. You can source some directly from the government about their spending at the link above (which covers all branches, including the executive). Be sure to take a look at the increase in deficit spending from 2020 on. I'd also bet against a rate cut. In the event there is, it'll be marginal.

Here's another link for you to a congressional research service report from 2021. You'll find that the concerns regarding interest rates and inflation are prescient and prevalent throughout. https://crsreports.congress.gov/product/pdf/R/R46729

Thanks for the links, @Hillbilly!

My summary of the summary of the CRS report:

Lots of debt, partly due to stimulus payments intended to keep COVID-related unemployment from multiplying suffering and collapsing the economy.

Growing debt, because fiscal discipline is hard and there are no serious political consequences for increasing the deficit (either by cutting taxes or increasing spending.

Not much damage yet, because investors worldwide prefer to hold dollars at this time.

At some unpredictable time, there could be serious damage if investors lose confidence in the U.S. dollar. This loss of confidence could be sudden, and could be very damaging.

Did I get this about right? And how does this show either party to be overall better at minimizing deficits and preventing the deficit-related component of inflation or inflation-fighting interest rates?

***

I understand the direct environmental harm (including climate disruption, migration, and wars) if the world doesn't switch ASAP to renewable energy -- including EVs, where individual vehicles are needed at all.

I don't understand how either party's economic policies will make up for either party's willingness to prolong the fossil-fuel era any longer than necessary.

***

Thanks to @Hillbilly, and to all, for civil and respectful discussions!

 

[Ahmadifier]

We're well beyond damaged...

this is probably because they are opening the new service center in Seattle. Supposedly, the Seattle one is one of the largest in the country.


https://riviantrackr.com/news/photos-tour-rivians-largest-service-center-in-seattle/

 

[Redline]

That's misleading. You have one party that wants to push and subsidize EVs but throw around so much free money that interest rates are forced up to curb all the inflationary pressure which is reducing real income. The flip side is that the other party shits on EVs but will do more to curb inflation and lower rates.

Yeah no lol

Vance unveils legislation to end all EV tax credits and introduce a $7500 tax credit for gas-powered cars.

“Right now, the official policy of the Biden administration is to spend billions of dollars on subsidies for electric vehicles made overseas,” said Senator Vance. “If we’re subsidizing anything, it ought to be Ohio workers – not the green energy daydreams that are offshoring their jobs to China."


Also, you might want to do yourself a favor HillBilly and take a look how we subsidize O&G.

 

[R1TCntrlMaIzzy]

Don't both parties, "..throw around so much free money..:? As I see it, a good portion goes to the corps. The repubs tend to help those corps and the wealthy more than the working, middle class.

Are you saying the dems do not to do their best to curb inflation and lower the interest rates? Which peer reviewed docs note this?

 

[Riviot]

this is probably because they are opening the new service center in Seattle. Supposedly, the Seattle one is one of the largest in the country.


https://riviantrackr.com/news/photos-tour-rivians-largest-service-center-in-seattle/

Good looking out! Time for a phone call...

 

[Hillbilly]

Yeah no lol

Vance unveils legislation to end all EV tax credits and introduce a $7500 tax credit for gas-powered cars.

“Right now, the official policy of the Biden administration is to spend billions of dollars on subsidies for electric vehicles made overseas,” said Senator Vance. “If we’re subsidizing anything, it ought to be Ohio workers – not the green energy daydreams that are offshoring their jobs to China."


Also, you might want to do yourself a favor HillBilly and take a look how we subsidize O&G.

There's nothing about that statement that would make me think Rivian wouldn't benefit from it. It's a comment about protectionism moreso than energy. That said, you're still likely to see an executive branch that support not only a protectionist agenda, but policies that will more quickly result in the fed reducing interest rates. Not to mention an interest in setting an agenda that benefits Tesla (Elon). So, while maybe not benefiting EV consumers as directly as a tax credit (I didn't get the credit for our Rivians anyway), I suspect you'll still see a platform that will help Rivian as a company toward profitability. But maybe that's not as important to you as seeing widespread proliferation of EVs, Chinese made or not. But we can only go so far on green energy while ignoring foreign competition that doesn't play by the same rules and observe the same environmental regulations that we do.

 

[PappaBolt]

this is probably because they are opening the new service center in Seattle. Supposedly, the Seattle one is one of the largest in the country.


https://riviantrackr.com/news/photos-tour-rivians-largest-service-center-in-seattle/

Seattle has been one of the biggest delivery markets. So many Rivians on the streets here, and it’s good thing. WA is EV friendly but politically still suffers under the dealership lobbyists.

Hopefully the new SC here is a model for what’s to come in other locales.

 

[Hillbilly]

Don't both parties, "..throw around so much free money..:? As I see it, a good portion goes to the corps. The repubs tend to help those corps and the wealthy more than the working, middle class.

Are you saying the dems do not to do their best to curb inflation and lower the interest rates? Which peer reviewed docs note this?

I think both parties have a Keynesian approach to spending, but Dems embrace it so blindly that they don't know when to turn off the tap. You can actually read that congressional report I linked to if you'd like. I can tell you didn't.

 

[Hereforthesnacks]

https://fiscaldata.treasury.gov/americas-finance-guide/national-deficit/

Facts aren't facts just because you say they are. You can source some directly from the government about their spending at the link above (which covers all branches, including the executive). Be sure to take a look at the increase in deficit spending from 2020 on. I'd also bet against a rate cut. In the event there is, it'll be marginal.

Here's another link for you to a congressional research service report from 2021. You'll find that the concerns regarding interest rates and inflation are prescient and prevalent throughout. https://crsreports.congress.gov/product/pdf/R/R46729

Oh, got it. You’re that guy.

First, you literally just proved my point. Spending was up from 2020-2021 (1 year, which is what I said) when inflation fears went up. It was not spending over the last 4 years. And none of that 20-21 spending went to EVs. That year of spending was pandemic related. You know; when. 20% of people didn’t have jobs lol.

And you also make my point because the huge spending in 2008 didn’t have the same effect.

I do like the strategy of taking a report from 2021 to try and prove a point about spending from 2020-2024. That’s pretty solid. But, if you look at a more recent paper, and there are many in line with this one, you’ll see that spending affects inflation. But the main driver this time was likely not spending. Spending rarely is the main driver of inflation. This time, as I said, supply chain shock was a huge factor and that had nothing to do with spending. Take a read: https://www.nber.org/system/files/working_papers/w30613/w30613.pdf

FYI - the US BLS links to that article: https://www.nber.org/system/files/working_papers/w30613/w30613.pdf

I attach the abstract.

regarding the rate cut, of course it will be marginal. It will be 0.25%. That is by definition the cut they will use. They can’t go higher or lower without spooking the market. But, congrats on the prediction?

 

[Hillbilly]

Oh, got it. You’re that guy.

First, you literally just proved my point. Spending was up from 2020-2021 (1 year, which is what I said) when inflation fears went up. It was not spending over the last 4 years. And none of that 20-21 spending went to EVs. That year of spending was pandemic related. You know; when. 20% of people didn’t have jobs lol.

And you also make my point because the huge spending in 2008 didn’t have the same effect.

I do like the strategy of taking a report from 2021 to try and prove a point about spending from 2020-2024. That’s pretty solid. But, if you look at a more recent paper, and there are many in line with this one, you’ll see that spending affects inflation. But the main driver this time was likely not spending. Spending rarely is the main driver of inflation. This time, as I said, supply chain shock was a huge factor and that had nothing to do with spending. Take a read: https://www.nber.org/system/files/working_papers/w30613/w30613.pdf

FYI - the US BLS links to that article: https://www.nber.org/system/files/working_papers/w30613/w30613.pdf

I attach the abstract.

regarding the rate cut, of course it will be marginal. It will be 0.25%. That is by definition the cut they will use. They can’t go higher or lower without spooking the market. But, congrats on the prediction?

First, don't start off a retort with a passive aggressive ad hominem. It makes your response look weaker. But I don't think you're arguing with me as much as you think you are. Deficit spending during COVID went up significantly. It's outside the scope here to argue if that was necessary or not, but it created more demand for products than the market warranted. That stimulus was not the only inflationary pressure on the market at that time, but the point stands that it's causally related to rates. Until the borrowing and spending slows at a faster pace, rates will hover where they are.

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