6 ms·

The value of taxi medallions has plummeted 90% in NYC

29 points by SQL2219 5y ago

dredmorbius 5y ago
When I studied econ at uni, NYC taxi medallions (along with NYSE stock exchange seats) were a classic example of monopoly-rents pricing in the curriculum. It's interesting to see that asset bubble entirely extinguished. Because of the previously-reliable valuation of medalions, their cost, and the value to both investors and owner-operators in having medallions, taxi medalion debt relief has actually been a major issue in NYC, with bailouts offered. This from November: https://www.thecity.nyc/2021/11/3/22762650/nyc-taxi-driver-medallion-debt-bailout-ends-hunger-strike https://www.thecity.nyc/2021/11/3/22762650/nyc-taxi-driver-m...
jmpman 5y ago
Any bailout should be paid for by a tax on ride sharing service. The government had granted the medallion owners a monopoly, and then refused to enforce that monopoly when the ride sharing services came into service. It would be like investing in a liquor license, and then a service came along which delivered bottles of wine to a party, but the delivery person drank a thimble full of wine, and now this delivery person was magically a guest at your party, bringing a bottle of wine to share. The “Jeremiah was a Bullfrog” app connects partiers with wine endowed friends, all for 20% less than traditional liquor stores, with free delivery.
- deleted 5y ago
  [deleted]
- csdvrx 5y ago
  Actually, that's a genius idea!
- short12 5y ago
  Or a better possiblity us to not bail them out. Let the cab industry burn to the ground
  - halpert 5y ago
    Why do people always want things to burn to the ground? Why not burn your home and things you care about to the ground? In all likelihood, they’re only serving you and a small portion of people around you. Why not do that?
    - Spivak 5y ago
      Because the taxi industry is being propped up by the government and the special treatment lasts only as long and people find the service useful and worth paying for in price and regulation. “Burning down” my personal possessions makes no sense because I’m not asking for society to bare the cost of my existence by giving me special treatment.
      - jmpman 5y ago
        Isn’t the government’s purpose to enforce property rights? Medallion owners didn’t just mint these medallions in their own shed. The government created the medallions, and intentionally limited supply to prevent road saturation (and other questionable reasons), just like the government intervenes in the agricultural market for farmer’s well being. With ride sharing, the incumbent sucked, and the challenger happened to be popular with the voting public. I suspect that reimbursing medallion owners is being considered because a large political donor acquired a number of medallions at discount, and is looking for politicians to “enforce his property rights”. The government should have done their job in the first place. Now, I smell something dirty. I’d recommend buying medallions.
- moistly 5y ago
  There’s a weed equivalent to your idea. In a jurisdiction I read about the other day, where possession & use is legal, but selling is not, supposedly “psychic” weed-dowsers will, for a fee, find your “lost” weed.
  - londons_explore 5y ago
    Very clever...
nn3 5y ago
Seems a much better solution would be to let the drivers go bankrupt? If it's possible for startups why not for cab drivers? That hedge fund or whatever it is that owns them would suffer, but well I'm sure they had a good ride while the party lasted.
- dookahku 5y ago
  On the surface it seems similar but I think there's differences because of proprietorship Seem to me that taxi driving is more of a (formerly) safe and proven blue collar job rather than an enormous and risky enterprise with investor money. Whereas with cab driving many times in the past it was a simple loan There's the expectation of failure in a startup but not in a simple blue collar job There is much more on the line personally than a startup.
  - Atheros 5y ago
    But the taxis and jobs aren't actually at risk of disappearing. The only thing at risk is the return on capital; the taxis and taxi drivers will remain regardless. One might say, "But the taxi drivers were sometimes the ones investing in medallions" to which I would reply that "investing" is the key word there. The medallion and the taxi it is on will continue to exist.
    - dookahku 5y ago
      I wish you could have empathy with other people
      - Atheros 5y ago
        There is no free lunch here. My empathy lands with the taxpayers who may or may not fund a bailout more than it lands with investors.
- vanusa 5y ago
  Seems a much better solution would be to let the drivers go bankrupt? That's the spirit - just fuck all these people. If it's possible for startups why not for cab drivers? Might there be a difference between startup founders and cab drivers?
dookahku 5y ago
I don't know if I'm totally sad about this... I don't know how many female friends I've had get sexually assaulted or raped inside a taxi cab. They could never catch the taxi cab drivers because nobody memorizes the number of the cab they're in...it's happened inside an Uber/lift but they actually got the guy because of the app I'm sure many cab drivers are very anti-rape but nobody seemed to have done anything to make the situation safer
- credit_guy 5y ago
  In NYC taxis have a plexiglass separator between the driver and the passengers. I'm not saying a driver can't sexually assault or rape a passenger, but in order to do that he would need to pull over and stop the car, get out, open the door to the back seats, get inside and attack his victim, and the victim should not have the presence of mind to just exit the vehicle through the other door, and run. I'm sure this may have happened, but it certainly can't be a frequent occurrence. I never heard of any such case (I lived in NYC for the last 7 years).
entropicgravity 5y ago
I have to feel sorry for the lawyers that own them.
AIorNot 5y ago
See: https://www.theguardian.com/us-news/2017/oct/20/new-york-yellow-cab-taxi-medallion-value-cost https://www.theguardian.com/us-news/2017/oct/20/new-york-yel... Sad for the immigrant owners who purchased them

29 points by SQL2219 5y ago

When I studied econ at uni, NYC taxi medallions (along with NYSE stock exchange seats) were a classic example of monopoly-rents pricing in the curriculum. It's interesting to see that asset bubble entirely extinguished. Because of the previously-reliable valuation of medalions, their cost, and the value to both investors and owner-operators in having medallions, taxi medalion debt relief has actually been a major issue in NYC, with bailouts offered. This from November: https://www.thecity.nyc/2021/11/3/22762650/nyc-taxi-driver-medallion-debt-bailout-ends-hunger-strike https://www.thecity.nyc/2021/11/3/22762650/nyc-taxi-driver-m...

jmpman 5y ago

Any bailout should be paid for by a tax on ride sharing service. The government had granted the medallion owners a monopoly, and then refused to enforce that monopoly when the ride sharing services came into service. It would be like investing in a liquor license, and then a service came along which delivered bottles of wine to a party, but the delivery person drank a thimble full of wine, and now this delivery person was magically a guest at your party, bringing a bottle of wine to share. The “Jeremiah was a Bullfrog” app connects partiers with wine endowed friends, all for 20% less than traditional liquor stores, with free delivery.

deleted 5y ago
[deleted]
csdvrx 5y ago
Actually, that's a genius idea!
short12 5y ago
Or a better possiblity us to not bail them out. Let the cab industry burn to the ground
- halpert 5y ago
  Why do people always want things to burn to the ground? Why not burn your home and things you care about to the ground? In all likelihood, they’re only serving you and a small portion of people around you. Why not do that?
  - Spivak 5y ago
    Because the taxi industry is being propped up by the government and the special treatment lasts only as long and people find the service useful and worth paying for in price and regulation. “Burning down” my personal possessions makes no sense because I’m not asking for society to bare the cost of my existence by giving me special treatment.
    - jmpman 5y ago
      Isn’t the government’s purpose to enforce property rights? Medallion owners didn’t just mint these medallions in their own shed. The government created the medallions, and intentionally limited supply to prevent road saturation (and other questionable reasons), just like the government intervenes in the agricultural market for farmer’s well being. With ride sharing, the incumbent sucked, and the challenger happened to be popular with the voting public. I suspect that reimbursing medallion owners is being considered because a large political donor acquired a number of medallions at discount, and is looking for politicians to “enforce his property rights”. The government should have done their job in the first place. Now, I smell something dirty. I’d recommend buying medallions.
moistly 5y ago
There’s a weed equivalent to your idea. In a jurisdiction I read about the other day, where possession & use is legal, but selling is not, supposedly “psychic” weed-dowsers will, for a fee, find your “lost” weed.
- londons_explore 5y ago
  Very clever...

nn3 5y ago

Seems a much better solution would be to let the drivers go bankrupt? If it's possible for startups why not for cab drivers? That hedge fund or whatever it is that owns them would suffer, but well I'm sure they had a good ride while the party lasted.

dookahku 5y ago
On the surface it seems similar but I think there's differences because of proprietorship Seem to me that taxi driving is more of a (formerly) safe and proven blue collar job rather than an enormous and risky enterprise with investor money. Whereas with cab driving many times in the past it was a simple loan There's the expectation of failure in a startup but not in a simple blue collar job There is much more on the line personally than a startup.
- Atheros 5y ago
  But the taxis and jobs aren't actually at risk of disappearing. The only thing at risk is the return on capital; the taxis and taxi drivers will remain regardless. One might say, "But the taxi drivers were sometimes the ones investing in medallions" to which I would reply that "investing" is the key word there. The medallion and the taxi it is on will continue to exist.
  - dookahku 5y ago
    I wish you could have empathy with other people
    - Atheros 5y ago
      There is no free lunch here. My empathy lands with the taxpayers who may or may not fund a bailout more than it lands with investors.
vanusa 5y ago
Seems a much better solution would be to let the drivers go bankrupt? That's the spirit - just fuck all these people. If it's possible for startups why not for cab drivers? Might there be a difference between startup founders and cab drivers?

dookahku 5y ago

I don't know if I'm totally sad about this... I don't know how many female friends I've had get sexually assaulted or raped inside a taxi cab. They could never catch the taxi cab drivers because nobody memorizes the number of the cab they're in...it's happened inside an Uber/lift but they actually got the guy because of the app I'm sure many cab drivers are very anti-rape but nobody seemed to have done anything to make the situation safer

credit_guy 5y ago
In NYC taxis have a plexiglass separator between the driver and the passengers. I'm not saying a driver can't sexually assault or rape a passenger, but in order to do that he would need to pull over and stop the car, get out, open the door to the back seats, get inside and attack his victim, and the victim should not have the presence of mind to just exit the vehicle through the other door, and run. I'm sure this may have happened, but it certainly can't be a frequent occurrence. I never heard of any such case (I lived in NYC for the last 7 years).

entropicgravity 5y ago

I have to feel sorry for the lawyers that own them.

AIorNot 5y ago

See: https://www.theguardian.com/us-news/2017/oct/20/new-york-yellow-cab-taxi-medallion-value-cost https://www.theguardian.com/us-news/2017/oct/20/new-york-yel... Sad for the immigrant owners who purchased them