Met a certified fool yesterday...

[skyhightree1]

I met a certified fool yesterday at the barn. I seen him at the barn many times lately. He sat next to me and we talked and he drunk the kool aid that cattle prices will not fall every again and the $3 calves were here forever. He told me he mortgaged his house and land he already had which was paid for to buy land cattle barn and equipment truck and new shiny aluminum trailer. He asked what I thought about that. I told him I hope hes got a good job or two. He told me he bought 10 heifers from the special sale earlier this year that he paid 2000-2300 for. :shock:

 

[Bigfoot]

We need a few like that. Encourage him.

 

[TN Cattle Man]

We need a few like that. Encourage him.

:clap: :clap: Yes we do!!

 

[Rafter S]

I'll probably step on some toes, but I think it's foolish to borrow money to buy cattle at any time, even putting up the cattle as collateral. To mortgage a home and paid-for land to buy them is several levels beyond foolish. I imagine his banker made him put up something besides the cattle because he hasn't drank the Kool-Aid.

 

[SJB]

It is now a normal thought process for a business to be constantly mortgaged to the hilt and ran as a cash flow business.

The least little downturn and they have to file bankruptcy. But they think that's ok. Makes me scratch my head.

 

[Jogeephus]

I know a few like that. Know two who have lost their homes with that kind of thinking. One is still telling me what I'm doing wrong and how I need to up my game.

 

[Jogeephus]

Sky, you need to do him a favor and tell him he's not going to make any money with those $2000 heifers. If he wants to make some real money he needs to buy some of my $4000 heifers.

 

[cowboy43]

Texas has a homestead law 200 or less is considered a homestead and can not be mortgaged ,

 

[skyhightree1]

Sky, you need to do him a favor and tell him he's not going to make any money with those $2000 heifers. If he wants to make some real money he needs to buy some of my $4000 heifers.

:lol2: I sure do and sell him those 4000 heifers

 

[Jogeephus]

Sky, you need to do him a favor and tell him he's not going to make any money with those $2000 heifers. If he wants to make some real money he needs to buy some of my $4000 heifers.

:lol2: I sure do and sell him those 4000 heifers

If he'll buy 40 or more I'll even deliver them at no charge but I will need to charge the customary handling fee, and a small charge for feed and water during the trip.

 

[skyhightree1]

Sky, you need to do him a favor and tell him he's not going to make any money with those $2000 heifers. If he wants to make some real money he needs to buy some of my $4000 heifers.

:lol2: I sure do and sell him those 4000 heifers

If he'll buy 40 or more I'll even deliver them at no charge but I will need to charge the customary handling fee, and a small charge for feed and water during the trip.

I will let him know hopefully I can get him to sign a contract today :lol2:

 

[M-5]

was he buying or selling???? if he was still buying he may come out smelling like a rose. His avg cost is going down everytime he raises his hand and the auctioneer says sold.

 

[skyhightree1]

was he buying or selling???? if he was still buying he may come out smelling like a rose. His avg cost is going down everytime he raises his hand and the auctioneer says sold.

He was just watching the sale.. He told me he spent all the money he had on cattle and money he had borrowed..

 

[backhoeboogie]

I know a few like that. Know two who have lost their homes with that kind of thinking. One is still telling me what I'm doing wrong and how I need to up my game.

The sad thing is you cannot help people like that.

 

[Bigfoot]

He probably has a 24' trailer. With a 32', he could haul more, and subsequently make more. It's simple economics really.

 

[Kingfisher]

Sky, you need to do him a favor and tell him he's not going to make any money with those $2000 heifers. If he wants to make some real money he needs to buy some of my $4000 heifers.

. You enabler you...

 

[TexasBred]

Texas has a homestead law 200 or less is considered a homestead and can not be mortgaged ,

Law changed quite a few years ago Cowboy. That was the law for ages but you can hock the place now for any reason, homestead of not.

 

[cowgirl8]

i know of a guy who borrowed money to buy cattle. He also leased this place down the road and not sure what their agreement was on improvements, but he had a fence built. I'm guessing the land owner failed to tell him the fence he paid for will be wiped out after a couple floods. He probably figured the guy would see all the trees and garbage built up on the last fence and the big creek running through the place would tip him off. Not to mention all the big trees that have already and will continue to fall on new fence. He's also bought a large number of new concrete feeders, built some corrals.... Moved in some hay. Not sure how many cows he has, 30ish, but the old farts around say he's got the place overstocked so thats another problem he'll run into not to mention he'll be getting about half what he thought he would this time last year. He even lives out of town, so he cant keep a good eye on the cattle..... I'm sure he's not the only one who dove into this business because of seeing green, when the green is going to be the poop kind now.
If all works out, this years big purchase will be solar panels for our house and barn. I got a new car last year...that will last me at lease 15 years..

 

[Nesikep]

I'm sure that 25 years ago we were the laughing stock of this stretch of road, but now we survived and we're now the longest owners of any piece of land on this road.. many ranches have sold 3 times, and all of them at least once... So now it's our turn to laugh at the greenhorns.

I don't like debt.. when I was younger i had credit card debt when I lost my job for a while, lived in my 1980 chevy blazer for a (coastal) winter.. even pinching every penny I could I was left with $8000 in debt by the end of it, and it took years to pay it off. Now I am of the opinion if it's not an absolute necessity, it's better to wait to build up the funds to buy it, to heck what the market is doing. If it's rising and suddenly turns down I'll just be able to buy more. When I have extra cash available I fill up the diesel tanks good and full.. I'd like to have at least 1000 gallons of storage available.. it's a little bit of protection from the volatile oil market.

 

[sim.-ang.king]

I guess none of you got the memo that corn will never go below $6, and feeders will always sell for $3.
I got my memo yesterday from the feed man.