Only $200 Million!

[Hippocampus]

Spent a fair amount of time in St.Bart’s and similar elite cruising hotspots.
The mega yachts and the cruise ships do little for the local economies. The mega yachts use their on board labor and fly in such tech as required . Even food and drink is not usually local sourced. There are some local purchases. In Road Town, le Marin and other places there are provisioning houses not open to the local public nor mom/pop cruisers which serve as import houses for such but have little impact on the local economy. So unless you’re a white South African less than 35 years of age with no tattoos mega yachts are meaningless to your bottom line.
Cruise ships do result in taxi drivers making money but again are mostly self contained with no help to the locals. Unlike small boat cruisers they don’t go to the local supermarkets nor spend significant money in restaurants as shipboard food is free nor use local boat services nor chandlers nor yards. Cruise ship money goes ~80% to the upper eschalon of the island and other forms of legal bribes. Infrastructure such as cruise ship docks, hospitals and the like are commonly built by the main land Chinese who bring in Chinese labor. Done on loans with kickbacks to the local eschalon and government.
So in terms of the Keysian multiplier there’s a huge difference between between the millions spent by the mega yachts and the funds spent by the middle class or even the one to five million dollar boat crowd. The latter results in local employment, meaningful jobs, personal dignity, a local skilled work force and an actual multiplier. The mega yacht and cruise ships don’t.

 

[Hippocampus]

Will also mention mega yachts don’t use boat yards. They use ship yards. There’s some overlap for the smaller mega yachts with places like Hinckley and IGY but in the main they are different clienteles and yards. One of my close friends was a mega yacht captain. Not a delivery captain but assigned to just one vessel and totally responsible for that vessel. So have some small knowledge of what goes on at that level. Will say the presence of mega yachts in the world has little or no impact on the availability of services for anything under ~100’.

 

[psneeld]

Director is building a new "shipyard" in Ft Pierce, Fl...looks like some of the other megayacht shipyards...more geared to recreational than commercial but I am sure will accept work from both.

One point was it was an ideal location for mega sailing vessels as the proximity to ocean, deep water to facility and no bridges.

Economic forecast for the local area has been touted by all groups as there are not local facilities that can handle larger vessels. Employment of marine trades will expand opportunities from the Ft Lauderdale and West Palm areas and draw from Gulf Coast and up North I would think ( less expensive living area)

 

[PM]

Buying a yacht like this could be considered to be step two in a Two step process called "win the lottery and go bankrupt."

pete

 

[MurrayM]

Trickle-down economics explained, Down Under style

 

[AdkChris]

What is this assumption that only rich peoples spending simulates the economy?

Rich folks will spend vast bucks in the service economy which has a larger multiplier effect, than poor folks simply surviving.

A fancy dinner for 2 might cost $300 excluding wine , a frozen pizza would not employ as many folks.

A long distance first class ticket might cost $5,000 , which allows the $200 ticket in the Roach Coach to exist.

The $200,000,000 boat allows the boat yard to prosper to haul our small boats.

That sounds like the publicity put out by the likes of Henry VIII, the Tsar of Russia, Antebellum plantation owners and Kim Jun-un: My incredibly huge cut of the pie is the best thing for you getting by on crumbs.

To paraphrase what many others have said here, The wealthy seem to have knack for not sharing the wealth.

 

[AdkChris]

I haven't spent much time in other ports but I have paddled around the harbor in Nantucket. There were expensive boats and boats so shabby I assume they belonged to seasonal hospitality workers. I have to say the people on the shabby boats looked much healthier, happier and sexier than the people polishing the big boats. I take that to mean the the money spent by us, middle class engineer and medical worker, was stimulating the economy much more effectively the money spent by the owners of the big boats.

 

[MurrayM]

When we sea kayaked through Lund, on BC's south coast, we met commercial fishermen heading north for the season. I was drinking back then, the bar had 1978 prices for draught for some reason, and when the fishermen found out we had paddled south from Kitimat they took us under their wings.

Bad combination.

In the early morning, me with a pounding headache, we departed at the same time a launch from a 75-ish foot motor yacht anchored outside came into the marina.

The two crew were dressed in white sailors outfits complete with dandy little caps and blue pinstripes. The owner had perfectly coiffed hair, freshly ironed shirt & trousers, with a white sweater tied around his neck. She had three too many layers of makeup and Texas sized hair. Just to dial it up to the max, they also had a pure white as driven snow standard clipped poodle...you know...the kind with puffy balls sculpted into the fur on its hips, shoulders, chest, and ears.

We laughed our asses off at the absurdity of it all.

 

[psneeld]

So much lost in translation......

 

[Hippocampus]

Murray Monty Pylon quality vid. Thanks for posting that.
This what I know
When I started boating there were two major marinas/yards servicing my town. Both were family owned. Both mixed use. Trawlers ( the kind with actual trawls) 20-30%, lobster boats 20-30% and the rest recreational craft. Costs were reasonable and the work good. You could bet your life on the quality.
Now the lobsters are moving north so less lobster boats. Days at sea are less so less trawlers and long liners. One yard closed. The owner of the other died of a brain tumor so bought out by Brewers. Brewers bought out by Safe Harbors. Safe Harbors bought out by Sun. Whereas costs were reasonable now they are excessive. Whereas I knew the owner and he cared about me now I’m a work order. Whereas if things weren’t up to expectations and remedied at no cost now it’s another bill or suit or take your business elsewhere.
I’ve used Hinckley and IGY several times and the quality has been excellent but you sure pay top dollar. I’ve keep the boat at the Brewers in Barrington and moved it to Hinckley to avoid the wrench at Brewers touching my boat. What I know each time a yard gets more “corporate “ it gets harder to work with them, more expensive and depending upon that particular yard quality of the work may suffer. Dereckors has been around for a real long time. 73 years I think and has a good reputation. Don’t think their new project is going to improve service for the readers of this post. Just ultimately mean fewer options for you at higher cost with less personal touches.

 

[psneeld]

Murray Monty Pylon quality vid. Thanks for posting that.
This what I know
When I started boating there were two major marinas/yards servicing my town. Both were family owned. Both mixed use. Trawlers ( the kind with actual trawls) 20-30%, lobster boats 20-30% and the rest recreational craft. Costs were reasonable and the work good. You could bet your life on the quality.
Now the lobsters are moving north so less lobster boats. Days at sea are less so less trawlers and long liners. One yard closed. The owner of the other died of a brain tumor so bought out by Brewers. Brewers bought out by Safe Harbors. Safe Harbors bought out by Sun. Whereas costs were reasonable now they are excessive. Whereas I knew the owner and he cared about me now I’m a work order. Whereas if things weren’t up to expectations and remedied at no cost now it’s another bill or suit or take your business elsewhere.
I’ve used Hinckley and IGY several times and the quality has been excellent but you sure pay top dollar. I’ve keep the boat at the Brewers in Barrington and moved it to Hinckley to avoid the wrench at Brewers touching my boat. What I know each time a yard gets more “corporate “ it gets harder to work with them, more expensive and depending upon that particular yard quality of the work may suffer. Dereckors has been around for a real long time. 73 years I think and has a good reputation. Don’t think their new project is going to improve service for the readers of this post. Just ultimately mean fewer options for you at higher cost with less personal touches.

No one said it was supposed to improve TFers life or that most of us will ever deal with them as a customer, just that it will add money back to the local economy and other support workers.

One part of economics that is hard to understand and/ or explain. I sure don't, but the longer I live, the less I think anyone does.

 

[AdkChris]

No one said it was supposed to improve TFers life or that most of us will ever deal with them as a customer, just that it will add money back to the local economy and other support workers.

One part of economics that is hard to understand and/ or explain. I sure don't, but the longer I live, the less I think anyone does.

Seems to me when wall street companies buy out local businesses they expect to move money from the local economy to their corporate offices and to wall street. Why else would they buy local businesses?

Also I suspect the reason economics can be hard to understand is that there are a lot of people trying to pass self serving BS off as economics. See above.

 

[MurrayM]

I lost a friend to this stuff.

There was a BIG project that had a proposal to come to our small town. I was part of a local group that, with the combined effort of many others, got the project denied.

My friend was born and grew up here, fished the river since he was a kid, and told me he wouldn't care if there was a spill in the river because he could go fish somewhere else. He knew if there was a spill the company's stock would tank for a while, he could gobble a bunch up at bargain basement prices, and sell later for a nice, tidy profit.

He would consider that people who don't profit from such an opportunity, are suckers.

Being driven by a profit at all costs attitude is no way to live.

 

[FF]

In many areas it seems the local small yard is either bought out by a corp, or sold to the land developers.

Once its a condo there are few jobs that pay well.

 

[JohnEasley]

Man... I would love the challenge of docking that boat! I would even do it for free.

 

[backinblue]

Man... I would love the challenge of docking that boat! I would even do it for free.

I bet it's less of challenge than docking a single screw trawler! You also have plenty of crew to help!

 

[JohnEasley]

I bet it's less of challenge than docking a single screw trawler! You also have plenty of crew to help!

So very true on both points. [emoji2]

 

[Benthic2]

What is this assumption that only rich peoples spending simulates the economy?

Rich folks will spend vast bucks in the service economy which has a larger multiplier effect, than poor folks simply surviving.

A fancy dinner for 2 might cost $300 excluding wine , a frozen pizza would not employ as many folks.

A long distance first class ticket might cost $5,000 , which allows the $200 ticket in the Roach Coach to exist.

The $200,000,000 boat allows the boat yard to prosper to haul our small boats.

BUT......if you give a tax break to a low income person they will spend 100% of it. If you give a tax break to a very wealthy person, it doesn't change their behavior.....it only increases their bank account.

 

[psneeld]

It not only depends on the person, but it depends on how they spend their money....sounds like some here don't like rich people......

 

[RT Firefly]

Greetings,
Mr. ps. "....sounds like a lot of people don't like rich people......" THAT'S why I'm on so many "ignore" lists!!!

 

[FF]

"BUT......if you give a tax break to a low income person they will spend 100% of it. If you give a tax break to a very wealthy person, it doesn't change their behavior.....it only increases their bank account."

The rich folks will either "put it in the bank" which lowers the borrowing cost for folks or gov.

Or "invests" it to make a profit , that's where new stuff comes from.

Sans investment air craft would still be DC 3's.

 

[Hippocampus]

Many advances in engineering, medicine, science and tech wouldn’t have occurred or would have been delayed without war. Does that make war a good thing?

As income inequality increases the fragility of our society does as well.
Now get incessant emails trying to sell me on a lifestyle rather than a working yard. I don’t need swimming pools, dockside bar/restaurants ,or concierge services. I do need good yard workers and techs and a secure slip with a responsive Dockmaster I can reliably raise on the VHF. Marinas are increasingly losing sight of why they exist. More markup in the frills and you don’t need a boat to even want to use them. The lifestyle kicks in when you leave the slip not while you’re there. The slip is like a garage with shop attached imho. There for storage and work.

 

[backinblue]

Many advances in engineering, medicine, science and tech wouldn’t have occurred or would have been delayed without war. Does that make war a good thing?

As income inequality increases the fragility of our society does as well.
Now get incessant emails trying to sell me on a lifestyle rather than a working yard. I don’t need swimming pools, dockside bar/restaurants ,or concierge services. I do need good yard workers and techs and a secure slip with a responsive Dockmaster I can reliably raise on the VHF. Marinas are increasingly losing sight of why they exist. More markup in the frills and you don’t need a boat to even want to use them. The lifestyle kicks in when you leave the slip not while you’re there. The slip is like a garage with shop attached imho. There for storage and work.

Though I agree that advancements have resulted from wars, there is no way of knowing the alternative reality. If all the money that gets spent on defense and development of weapons, was spent on other research instead, we would have other advances.

 

[Benthic2]

"BUT......if you give a tax break to a low income person they will spend 100% of it. If you give a tax break to a very wealthy person, it doesn't change their behavior.....it only increases their bank account."

The rich folks will either "put it in the bank" which lowers the borrowing cost for folks or gov.

Or "invests" it to make a profit , that's where new stuff comes from.

Sans investment air craft would still be DC 3's.

I respectfully disagree. Money at the lower end of the economic spectrum gets "churned" First it goes towards a new coat, and then the clothing store, gets new carpet, and then the carpet installer, hires an apprentice, and the apprentice buys some tools.......

Trickle down economics doesn't work. Reagan tried it in the 80's, Kansas tried it in 2011.....Trump just tried it again.

Investment does not spur innovation. It spurs bonuses and stock options for the 1%. You mention the DC-3, which evolved from the DC-1, which was developped during the Great Depression, so it certainly didn't depend on investment from wealthy people.

Competition is what spurs innovation. The 60's and 70's saw the L-1011, the DC-10, and the 727 all trying to gain market share. I think you actually may have it backwards. Innovation just might spur investment. Apple, Microsoft, Tesla, Walmart, and Amazon all developed products and THEN went public.

The income inequality divide can only grow for so long before something has to give. Just ask Louis 16th.

 

[psneeld]

Marina lifestyle is what some want along with a little boating.


In some places, also with campgrounds, it is the only affordable housing near some shore areas.


If innovation spurs investment...may be it is just a seesaw that without one the other may lag or not happen as some innovation takes a lot of money....not all great minds have access to it.


Thus Shark Tank....Bezos sending a billion or so to earth programs, Dolly Parton's million towards vaccine development......


I never made much in the USCG or assistance towing...but loved almost every minute of both. Rubbed elbows with some pretty rich people...never begrudged the nice ones a nickel. The people I didn't care for were the ones who complained about how you just saved them or their boat.....

 

[MurrayM]

This is about the best article I've read on income inequality, which was written in 2014.

While reading it, keep in mind how hard 'essential workers' have been impacted by Covid-19, and add that to the societal stresses outlined in the article:

https://www.politico.com/magazine/story/2014/06/the-pitchforks-are-coming-for-us-plutocrats-108014

 

[Hippocampus]

Murray he’s spot on. Actually more libertarian than liberal is the thought about giving fishing rods and fishing knowledge rather than dead fish.
Component not addressed is with each major advance in science/technology/engineering the need for unskilled and skilled manual labor decreases. Instead of 99% of the population involved in food production now its ~1% as an example in the industrial west. There’s two revolutions currently occurring. One in biology ( genetics, proteinonomics, bioengineering) the other in AI/robotics.
The risk is we evolve into two strata. One stronger, more intelligent, healthier, longer living hence more competitive in the economic as well as any playing field. They will also manage, eventually control AI. Not jus AI but also it’s spin-offs and consequences. What strata you end in is determined by your antecedents position now (that’s us fellow reader). The people with the resources to make use of the advances of the biologic revolution for their children and themselves will truly be a different breed within a few generations. Sounds like eugenics but it’s not. Just people wanting better for their kids and only directly acting on a personal level inside and on their own families.
Although the article is right it misses the great moral conundrum presented to us.

 

[MurrayM]

Murray he’s spot on. Actually more libertarian than liberal is the thought about giving fishing rods and fishing knowledge rather than dead fish.
Component not addressed is with each major advance in science/technology/engineering the need for unskilled and skilled manual labor decreases. Instead of 99% of the population involved in food production now its ~1% as an example in the industrial west. There’s two revolutions currently occurring. One in biology ( genetics, proteinonomics, bioengineering) the other in AI/robotics.
The risk is we evolve into two strata. One stronger, more intelligent, healthier, longer living hence more competitive in the economic as well as any playing field. They will also manage, eventually control AI. Not jus AI but also it’s spin-offs and consequences. What strata you end in is determined by your antecedents position now (that’s us fellow reader). The people with the resources to make use of the advances of the biologic revolution for their children and themselves will truly be a different breed within a few generations. Sounds like eugenics but it’s not. Just people wanting better for their kids and only directly acting on a personal level inside and on their own families.
Although the article is right it misses the great moral conundrum presented to us.

It was a long article as it is...maybe he'll write a book and flesh it out

We are indeed at a crossroads, again. Fire, Stone Age, wheel, agriculture, Bronze Age, science, Industrial Age, and now whatever they're going to call this age in 100 years. There are always winners and losers.

The scariest part for me is the other 6 billion or so who want our lifestyle. Something has to give.

 

[HiDHo]

BUT......if you give a tax break to a low income person they will spend 100% of it. If you give a tax break to a very wealthy person, it doesn't change their behavior.....it only increases their bank account.

A tax break means you get to keep more of the money YOU earned. It’s that persons money, they get to spend it, invest it or save it. What’s the Problem.

 

[psneeld]

Some people plan and withing 3 generations go from just above poverty level to the grandkids or great grandkids going upper middle class.


That's not from being greedy or criminal...just working hard, being frugal, saving, planning, investing wisely thus letting future generations have options.