Originally Posted by
The_Guru
If it's a financial issue, try to hedge your stance in terms of:
lower fuel costs, if commuting
better bike = more enjoyment = happier you = happier her
better bike = more enjoyment = more cycling = healthier you = longevity
just like you probably wouldn't buy a $5000 car (given your vacation budget), you'd like a bike in the same economic ballpark.
BTW - how was your South African trip? (I'm from Cape Town :-) )
If you're looking at it from a financial standpoint, ie: hedging, a $150 bike would do a much better job @ hedging rising fuel costs as opposed to one any higher. It gets the same job done as a $1000 bike, exactly the same cash flow or utility flow in our case therefore an arbitrage exists, but for our friend here there's no taking advantage. Also, why hedge with an overpriced instrument - if you could purchase the same put option for $250 or $1000 with the same rights, which do you chose? You know the answer..