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This article is baffling. It's full of very loaded language (e.g. prey, seized control, squeezed, etc). And the evidence and explanations they provide is even m

by bko 7y ago

This article is baffling. It's full of very loaded language (e.g. prey, seized control, squeezed, etc). And the evidence and explanations they provide is even more baffling and contradictory. > Some adopted an especially aggressive approach, according to documents and interviews. First, they purchased medallions at bargain rates and established big fleets of cabs. Then, they pumped up medallion prices. Finally, they sold their medallions to their drivers and to rival fleet operators just before the collapse. Take each claim one by one: > First, they purchased medallions at bargain rates How did they get them at bargain rates? > Then, they pumped up medallion prices. Again, how? Did they somehow drive the population increase in NYC? > Finally, they sold their medallions to their drivers and to rival fleet operators just before the collapse. Did they sell the medallions or finance them to drivers, because earlier in the article it says: > They inflated medallion prices, provided high-risk loans to buyers and collected interest and fees before the bubbles burst and the markets collapsed. If they financed them, the drivers defaulted and the collateral was worth a lot less than originally valued at. The whole article is a weird hodge-podge mess of trying to find victimizers and victims. People who bought medallions between certain years are victimizers but those that bought them after the peak are victims and New Yorkers (?) in Chicago are especially bad.

johnnycab 7y ago
I found the article to be a sad tale, rather than defining it as baffling. The answers to most of your questions can be found in the article, which describes the latent demand for medallions, allowing the opportunistic speculators to swoop in. It was aided by the city, which no doubt welcomed the additional revenue, and didn't do anything substantial to prevent a bubble from forming and exacerbated the misery. The effect of the pump and dump was compounded by the victims, who share a common thread, and their stories pepper the article. This vulnerable group was targeted for it's high susceptibility to any number of cons, and were also the most likely to ignore the zeitgeist of the app-model. Many were immigrant cabdrivers who could not speak English fluently and signed loans they could not afford, lured by the promise of easy wealth and a secure future.
- bko 7y ago
  > ... allowing the opportunistic speculators to swoop in ... This vulnerable group was targeted for it's high susceptibility to any number of cons, and were also the most likely to ignore the zeitgeist of the app-model. This is where the narrative of victim and victimizer breaks down. Consider one of the sad tales from the article: > “They used us to get rich,” said Demetrios Manolitsis, 52, a Chicago cabdriver from Greece. Mr. Manolitsis, who started driving in 1992 and owned an extra medallion as an investment, said New Yorkers in Chicago convinced him to borrow money to buy 15 more medallions at the height of the bubble, when prices were skyrocketing and the asset seemed invincible. He is now buried in debt and on the brink of losing everything. He's both an opportunistic speculator buying 15 (!) medallions and a victim who was conned. Depending on when the market took an eventual downturn he could have been a villain. He could have been part of the ominous "they" sprinkled throughout the piece!
  - johnnycab 7y ago
    >He's both an opportunistic speculator buying 15 (!) medallions and a victim who was conned. Depending on when the market took an eventual downturn he could have been a villain. He could have been part of the ominous "they" sprinkled throughout the piece! I would describe him as a victim of greed, as he already had another medallion as an investment. For him to be regarded as a 'speculator' in this context ─ he could have averted financial ruin by conducting due diligence before acquiring toxic assets and/or hedge his bets. If one were to consider him opportunistic, he should have been savvy enough to know, when to get out and leave others holding the bag. Since, he seems to have exhibited none of the predatory behaviour associated with a conman, it is a bit presumptuous to speculate on his villainous tendencies.
    - bko 7y ago
      Explain to me a framework for determining victimhood. > For him to be regarded as a 'speculator' in this context ─ he could have averted financial ruin by conducting due diligence before acquiring toxic assets and/or hedge his bets. Is the term speculator contingent on financial success? > If one were to consider him opportunistic, he should have been savvy enough to know, when to get out and leave others holding the bag. Is opportunistic contingent on someone being able to tell the future and know when prices are at their peak? > Since, he seems to have exhibited none of the predatory behaviour associated with a conman I imagine he wasn't using all 15 of his medallions simultaneously. Presumably he was renting out his medallions to other and profiting off their labour. Is this predatory? > it is a bit presumptuous to speculate on his villainous tendencies. You miss my point. I reject the entire notion of victim and victimizers in this context. The analogy doesn't fit. If you buy 15 of a valuable and high growth asset on credit, you're a speculator. And that's fine. There are no villains here, just some who were fortunate in timing and other who were less fortunate.
js2 7y ago
> New Yorkers (?) in Chicago are especially bad. Well that goes without saying. (I jest of course. I have no dog in this fight and think they are both great cities.)
exhilaration 7y ago
The article does explain how they inflated the prices, they sold them to each other at increasingly higher prices, which kept bumping up the recorded last sale price. At the risk of violating HN rules, I have to say that you didn't read the article.
- bko 7y ago
  I doubt that would make sense financially. Prior to 2017, there was a 5% transfer tax on medallion sales [0]. I believe they would also have to pay either a capital gains tax or treat the gains from the sale as income. It would be a very expensive strategy to get a paper uptick in the last recorded sale price that you may or may not benefit from. And there are all sorts of other regulations that manipulate the market and distort sales. For instance prior to 2017 owners of single medallions were limited to selling to someone who doesn’t already own one [0]. The sales from one member to another could have just been a family business arrangement where one group of individuals brings in another business partner. Instead of some bizarre conspiracy theory about unnamed group of individuals that can manipulate prices, lure just the right speculators at the very peak and move on, why can't it just be that there are some speculators that did well and others that entered too late and lost out? Why does everything have to be viewed as a victim/victimizer paradigm? [0] https://www.cbsnews.com/news/how-much-is-a-nyc-taxi-medallion-worth-these-days/ https://www.cbsnews.com/news/how-much-is-a-nyc-taxi-medallio...

by bko 7y ago

johnnycab 7y ago

I found the article to be a sad tale, rather than defining it as baffling. The answers to most of your questions can be found in the article, which describes the latent demand for medallions, allowing the opportunistic speculators to swoop in. It was aided by the city, which no doubt welcomed the additional revenue, and didn't do anything substantial to prevent a bubble from forming and exacerbated the misery. The effect of the pump and dump was compounded by the victims, who share a common thread, and their stories pepper the article. This vulnerable group was targeted for it's high susceptibility to any number of cons, and were also the most likely to ignore the zeitgeist of the app-model. Many were immigrant cabdrivers who could not speak English fluently and signed loans they could not afford, lured by the promise of easy wealth and a secure future.

bko 7y ago
> ... allowing the opportunistic speculators to swoop in ... This vulnerable group was targeted for it's high susceptibility to any number of cons, and were also the most likely to ignore the zeitgeist of the app-model. This is where the narrative of victim and victimizer breaks down. Consider one of the sad tales from the article: > “They used us to get rich,” said Demetrios Manolitsis, 52, a Chicago cabdriver from Greece. Mr. Manolitsis, who started driving in 1992 and owned an extra medallion as an investment, said New Yorkers in Chicago convinced him to borrow money to buy 15 more medallions at the height of the bubble, when prices were skyrocketing and the asset seemed invincible. He is now buried in debt and on the brink of losing everything. He's both an opportunistic speculator buying 15 (!) medallions and a victim who was conned. Depending on when the market took an eventual downturn he could have been a villain. He could have been part of the ominous "they" sprinkled throughout the piece!
- johnnycab 7y ago
  >He's both an opportunistic speculator buying 15 (!) medallions and a victim who was conned. Depending on when the market took an eventual downturn he could have been a villain. He could have been part of the ominous "they" sprinkled throughout the piece! I would describe him as a victim of greed, as he already had another medallion as an investment. For him to be regarded as a 'speculator' in this context ─ he could have averted financial ruin by conducting due diligence before acquiring toxic assets and/or hedge his bets. If one were to consider him opportunistic, he should have been savvy enough to know, when to get out and leave others holding the bag. Since, he seems to have exhibited none of the predatory behaviour associated with a conman, it is a bit presumptuous to speculate on his villainous tendencies.
  - bko 7y ago
    Explain to me a framework for determining victimhood. > For him to be regarded as a 'speculator' in this context ─ he could have averted financial ruin by conducting due diligence before acquiring toxic assets and/or hedge his bets. Is the term speculator contingent on financial success? > If one were to consider him opportunistic, he should have been savvy enough to know, when to get out and leave others holding the bag. Is opportunistic contingent on someone being able to tell the future and know when prices are at their peak? > Since, he seems to have exhibited none of the predatory behaviour associated with a conman I imagine he wasn't using all 15 of his medallions simultaneously. Presumably he was renting out his medallions to other and profiting off their labour. Is this predatory? > it is a bit presumptuous to speculate on his villainous tendencies. You miss my point. I reject the entire notion of victim and victimizers in this context. The analogy doesn't fit. If you buy 15 of a valuable and high growth asset on credit, you're a speculator. And that's fine. There are no villains here, just some who were fortunate in timing and other who were less fortunate.

js2 7y ago

> New Yorkers (?) in Chicago are especially bad. Well that goes without saying. (I jest of course. I have no dog in this fight and think they are both great cities.)

exhilaration 7y ago

The article does explain how they inflated the prices, they sold them to each other at increasingly higher prices, which kept bumping up the recorded last sale price. At the risk of violating HN rules, I have to say that you didn't read the article.

bko 7y ago
I doubt that would make sense financially. Prior to 2017, there was a 5% transfer tax on medallion sales [0]. I believe they would also have to pay either a capital gains tax or treat the gains from the sale as income. It would be a very expensive strategy to get a paper uptick in the last recorded sale price that you may or may not benefit from. And there are all sorts of other regulations that manipulate the market and distort sales. For instance prior to 2017 owners of single medallions were limited to selling to someone who doesn’t already own one [0]. The sales from one member to another could have just been a family business arrangement where one group of individuals brings in another business partner. Instead of some bizarre conspiracy theory about unnamed group of individuals that can manipulate prices, lure just the right speculators at the very peak and move on, why can't it just be that there are some speculators that did well and others that entered too late and lost out? Why does everything have to be viewed as a victim/victimizer paradigm? [0] https://www.cbsnews.com/news/how-much-is-a-nyc-taxi-medallion-worth-these-days/ https://www.cbsnews.com/news/how-much-is-a-nyc-taxi-medallio...