It's a stupid game because it's really really rare for this kind of arbitrage to exist in the system, especially if you do the computation correctly and count after-tax income rather than pre-tax income.

In the rare instances where you profit, congratulations, I guess? I haven't ever heard of a single person who got rich off of car loan arbitrage. None. But I know tons of people who got rich off of never borrowing a car loan. A $700 per month payment stream invested at 5% over 30 years is half a million dollars. I'd rather have $500000 than a permanent car loan.

I see your point, but I don’t know if people in the financial position to do this do it to get rich. I always saw it as creating small bits of edge in the game.

Also, to this point, the interest arb doesn’t work out the way most people use it because they don’t account for the principle. You’re still going negative into a depreciating liability if you only invest the value of the car. It’s just you’re not going negative with interest.

To go fully not negative requires a lot more cash to generate the interest income to cover the entire payment.