Card Prices During Recessions

[Exhibitman]

Ryan's right, long term, the blue chip stuff holds and gains. Look at Paleo's tables. You could knock 50% out of the current price on the Speaker and still have a hell of a return over 10 years.

What's really confounding everyone is that this isn't 1977's stagflation it is 1947's inflation, and nobody who isn't sitting in a home gumming their oatmeal experienced the economy as an adult in 1947, but plenty of the septuagenarians and octogenarians who are in power vividly remember the 1970s. What's missing from the 1970s analogies is the "stag" part of "stagflation". Employment is tight and we had real growth last quarter. The simple fact is that inflation was inevitable once the COVID shock wore off. We have a couple of years of pent-up demand due to the plague that is expressing itself in ways that the economy wasn't geared to expect, causing both the supply chain to snarl and the core rate of inflation to rise. The latter is what the Fed is going after hard. But interest rates are an oddly focused brick to the head. They hit factored industries, housing and construction very hard, don't affect the information businesses much unless they have variable loans or bonds, which is rare. On the consumer level, it is a mixed bag. It basically tanks the home selling business but current homeowners who refi'd to fixed loans at 2%-3% are loving life right now; they might even see nominal returns on their savings top their mortgage rates, which is nuts. The gas and food price increases are completely different, essentially they are bets on the war in Europe and its impact on energy and food supply, plus some incredible profiteering by the oil companies (look at the crazy profits they made last quarter) and the usual terrorist tactics from the OPECkers, who yet again kneed us in the nuts right when we needed to get prices to come down (next time we invade can we just kill them all and take the oil instead of pretending we care about anything else? Too much? I can never tell). I kid our great and loyal friends in the Middle East...