4 ms·

Gold, silver, stocks, real estate, Bitcoin, baseball cards, fine art, Rolexes - everything is trading at or near their all time highs. The value of the US dolla

by paxys 1y ago

Gold, silver, stocks, real estate, Bitcoin, baseball cards, fine art, Rolexes - everything is trading at or near their all time highs. The value of the US dollar is simply going down.

skybrian 1y ago
The art market doesn't seem to be doing well at all: https://news.ycombinator.com/item?id=45175628 https://news.ycombinator.com/item?id=45175628
- throw0101c 1y ago
  Rolexes hit their all-time high in 2022: * https://watchcharts.ca/watches/price_index https://watchcharts.ca/watches/price_index * https://watchcharts.ca/watches/brand_index/rolex https://watchcharts.ca/watches/brand_index/rolex * https://www.hodinkee.com/articles/used-watch-market-prices-enjoy-best-performance-in-more-than-three-years-as-cartier-omega-rolex-and https://www.hodinkee.com/articles/used-watch-market-prices-e... >> The value of the US dollar is simply going down. I wonder what could be causing nervousness in the USD regime…
pizlonator 1y ago
Bingo So then the question is - how long can this continue before something snaps
- MountDoom 1y ago
  Pretty long, given that the US had a fully-fiat currency for 50+ years, and many European countries had it for longer than that. Per CPI, your dollar is worth 8x less than what it was worth in 1970. This, in itself, doesn't mean anything profound. There's nothing to "snap" if the expectation of stable, modest inflation is baked into the markets. Fiat currencies usually implode only when something else undermines the confidence in the issuing government.
  - pizlonator 1y ago
    The issue is that we're seeing asset price inflation that is far greater than CPI In other words, we have two different inflations happening at once, leading to people who happened to own the right assets getting richer and everyone else getting poorer. I don't think that's what an efficient market would do, which implies that efficiency will kick in at some point and BOOM
    - zahlman 1y ago
      > we're seeing asset price inflation that is far greater than CPI Have a look at the CPI-adjusted gold chart, and think back to how awful things were (or weren't) in 2011.
    - MountDoom 1y ago
      > In other words, we have two different inflations happening at once CPI is just an index of consumer prices. It's like saying that we have two stock markets because Nvidia is going up faster than Costco. > People who happened to own the right assets getting richer and everyone else getting poorer It's not a zero-sum game. Almost everyone is more wealthy than their peers 30-40 years ago. Wealth disparities widen, but the reasons for this are complex and go beyond inflation. And frankly, many of them are self-inflicted. Every single housing development in my neighborhood is thoroughly protested by everyone. And most of what my city officials do is inventing new rules and regulations. They're not working for big corporations or the federal government. > I don't think that's what an efficient market would do Sounds like you spotted an arbitrage opportunity?
  - zahlman 1y ago
    For that matter, the US recovered from the inflation of the 80s and avoided a serious hyperinflationary spiral of the sort seen in many less stable regimes, and when the real-terms price of gold spiked in 2011 it wasn't even accompanied by unusual levels of inflation.
  - eadmund 1y ago
    > your dollar is worth 8x less than what it was worth in 1970. A dollar in 2025 is not worth -7 (i.e. eight times one less than one) dollars from 1970; it is worth ⅛th of a dollar from 1970. Yes, I know what you mean. But ‘×’ is multiplication, not division — and phrases like ‘¼ less than’ and ‘3 less than’ have clear meanings inconsistent with using ‘8× less than’ to mean ‘⅛th.’
MichaelDickens 1y ago
Those things are trading high relative to basic goods like food and clothing, so you can't explain it away as inflation.
onlyrealcuzzo 1y ago
Fiat money is not going down as much as asset prices are going up, though. So it's part of the story, money losing value in the real economy. That's been happening since moving off the gold standard at roughly similar rates. There's something that happened during ZIRP & Negative Real Interest Rate Policies that completely divorced the value of money in the real economy from the value of assets & future cash flows, and even when interest rates became positive again, the trend appears to have continued. Perhaps all investors just believe ZIRP & Negative Real Interest Rate Policies are coming back, maybe to even more negative real rates than ever before.
- tossandthrow 1y ago
  > Fiat money is not going down as much as asset prices are going up, though. How do you measure this? What is this claim founded in? You could indeed say that inflation should be defined by the asset prices. This would couple fiat and asset prices definatorically.
  - onlyrealcuzzo 1y ago
    Because normal people mainly use money to pay rent and utilities and taxes and buy corn from the grocery store, not to buy future cash flows.
    - Ancapistani 1y ago
      At any given time, most of the money isn't in the hands of "normal people", though. It's in the hands of banks, states, and large companies.
      - onlyrealcuzzo 1y ago
        The amount of money isn't relevant. Money is fake. The real economy isn't.
  - jhrmnn 1y ago
    I’m guessing what was meant is that the price of things that are to be invested in is growing wrt the price of things that are to be consumed. Which naively makes sense to me in an economy based on growth where the total consumption starts to stagnate—the surplus still has to go somewhere. Is it so or is reality more complicated than that?
lottin 1y ago
As expected. This is why we don't use nominal dollars for measuring changes in prices over long time periods. It's meaningless.
- zahlman 1y ago
  Assets like gold are also reaching new highs in real terms, which is giving people reason to be skeptical of the adjustments made for inflation. But really none of it is as objective as it tries to pretend to be.
paulpauper 1y ago
not really. Bitcoin is still around 10% from ATH. Art, wine and various collectibles are still down a lot from the highs. The dollar does not have anything to do with this. A falling dollar does not make Americans want to splurge or lead to speculation. Indeed, the dollar surged in 2008 and 2009, yet asset prices were falling. A falling dollar is only indicative of demand for other currencies. it has nothing to do with asset prices, as art and other prices are almost already quoted in dollars anyway. if people wanted to hedge the falling dollar, they would buy those currencies.

by paxys 1y ago

Gold, silver, stocks, real estate, Bitcoin, baseball cards, fine art, Rolexes - everything is trading at or near their all time highs. The value of the US dollar is simply going down.

skybrian 1y ago

The art market doesn't seem to be doing well at all: https://news.ycombinator.com/item?id=45175628 https://news.ycombinator.com/item?id=45175628

throw0101c 1y ago
Rolexes hit their all-time high in 2022: * https://watchcharts.ca/watches/price_index https://watchcharts.ca/watches/price_index * https://watchcharts.ca/watches/brand_index/rolex https://watchcharts.ca/watches/brand_index/rolex * https://www.hodinkee.com/articles/used-watch-market-prices-enjoy-best-performance-in-more-than-three-years-as-cartier-omega-rolex-and https://www.hodinkee.com/articles/used-watch-market-prices-e... >> The value of the US dollar is simply going down. I wonder what could be causing nervousness in the USD regime…

pizlonator 1y ago

Bingo So then the question is - how long can this continue before something snaps

MountDoom 1y ago
Pretty long, given that the US had a fully-fiat currency for 50+ years, and many European countries had it for longer than that. Per CPI, your dollar is worth 8x less than what it was worth in 1970. This, in itself, doesn't mean anything profound. There's nothing to "snap" if the expectation of stable, modest inflation is baked into the markets. Fiat currencies usually implode only when something else undermines the confidence in the issuing government.
- pizlonator 1y ago
  The issue is that we're seeing asset price inflation that is far greater than CPI In other words, we have two different inflations happening at once, leading to people who happened to own the right assets getting richer and everyone else getting poorer. I don't think that's what an efficient market would do, which implies that efficiency will kick in at some point and BOOM
  - zahlman 1y ago
    > we're seeing asset price inflation that is far greater than CPI Have a look at the CPI-adjusted gold chart, and think back to how awful things were (or weren't) in 2011.
  - MountDoom 1y ago
    > In other words, we have two different inflations happening at once CPI is just an index of consumer prices. It's like saying that we have two stock markets because Nvidia is going up faster than Costco. > People who happened to own the right assets getting richer and everyone else getting poorer It's not a zero-sum game. Almost everyone is more wealthy than their peers 30-40 years ago. Wealth disparities widen, but the reasons for this are complex and go beyond inflation. And frankly, many of them are self-inflicted. Every single housing development in my neighborhood is thoroughly protested by everyone. And most of what my city officials do is inventing new rules and regulations. They're not working for big corporations or the federal government. > I don't think that's what an efficient market would do Sounds like you spotted an arbitrage opportunity?
- zahlman 1y ago
  For that matter, the US recovered from the inflation of the 80s and avoided a serious hyperinflationary spiral of the sort seen in many less stable regimes, and when the real-terms price of gold spiked in 2011 it wasn't even accompanied by unusual levels of inflation.
- eadmund 1y ago
  > your dollar is worth 8x less than what it was worth in 1970. A dollar in 2025 is not worth -7 (i.e. eight times one less than one) dollars from 1970; it is worth ⅛th of a dollar from 1970. Yes, I know what you mean. But ‘×’ is multiplication, not division — and phrases like ‘¼ less than’ and ‘3 less than’ have clear meanings inconsistent with using ‘8× less than’ to mean ‘⅛th.’

MichaelDickens 1y ago

Those things are trading high relative to basic goods like food and clothing, so you can't explain it away as inflation.

onlyrealcuzzo 1y ago

Fiat money is not going down as much as asset prices are going up, though. So it's part of the story, money losing value in the real economy. That's been happening since moving off the gold standard at roughly similar rates. There's something that happened during ZIRP & Negative Real Interest Rate Policies that completely divorced the value of money in the real economy from the value of assets & future cash flows, and even when interest rates became positive again, the trend appears to have continued. Perhaps all investors just believe ZIRP & Negative Real Interest Rate Policies are coming back, maybe to even more negative real rates than ever before.

tossandthrow 1y ago
> Fiat money is not going down as much as asset prices are going up, though. How do you measure this? What is this claim founded in? You could indeed say that inflation should be defined by the asset prices. This would couple fiat and asset prices definatorically.
- onlyrealcuzzo 1y ago
  Because normal people mainly use money to pay rent and utilities and taxes and buy corn from the grocery store, not to buy future cash flows.
  - Ancapistani 1y ago
    At any given time, most of the money isn't in the hands of "normal people", though. It's in the hands of banks, states, and large companies.
    - onlyrealcuzzo 1y ago
      The amount of money isn't relevant. Money is fake. The real economy isn't.
- jhrmnn 1y ago
  I’m guessing what was meant is that the price of things that are to be invested in is growing wrt the price of things that are to be consumed. Which naively makes sense to me in an economy based on growth where the total consumption starts to stagnate—the surplus still has to go somewhere. Is it so or is reality more complicated than that?

lottin 1y ago

As expected. This is why we don't use nominal dollars for measuring changes in prices over long time periods. It's meaningless.

zahlman 1y ago
Assets like gold are also reaching new highs in real terms, which is giving people reason to be skeptical of the adjustments made for inflation. But really none of it is as objective as it tries to pretend to be.

paulpauper 1y ago

not really. Bitcoin is still around 10% from ATH. Art, wine and various collectibles are still down a lot from the highs. The dollar does not have anything to do with this. A falling dollar does not make Americans want to splurge or lead to speculation. Indeed, the dollar surged in 2008 and 2009, yet asset prices were falling. A falling dollar is only indicative of demand for other currencies. it has nothing to do with asset prices, as art and other prices are almost already quoted in dollars anyway. if people wanted to hedge the falling dollar, they would buy those currencies.