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Bubblicious used car prices rising faster than bitcoin, Jim Bianco warns


You might be more likely to own your car than you are to have it in your portfolio.

According to Jim Bianco, market researcher Jim Bianco says used auto prices have risen faster than other assets and bitcoin.

According to Bianco Research’s President, “If you’re looking for the greatest investment that you’ve made in 2021 it is that car that’s in your garage.”Trading NationOn Thursday, “It’s appreciating quicker than the stock markets and lately more than some cryptocurrencies.

The Manheim index for used cars prices is the basis of his analysis. It tracks pricing trends within the market.

They’ve risen in value by more than 20% over the past four months. Not only is that more than the S&P, but over the last four months that’s more than bitcoin itself,” he said. According to the most recent data, December 15th was the last day we had. They are just getting faster and more right now. At this point, we don’t know if there has been a peak.

BitcoinBased on the Thursday stock exchange close, it has risen by 5% in four months. Based on Thursday’s stock market close, the The S&P 500It is currently up by 26%

Bianco mentions two positive drivers for the used car marketplace. First, the price drop in new cars is due to the shortage of semiconductors.

According to Kelley Blue Book, auto prices have reached record levels. A new car’s average price was $46,320, while used cars were at $27 5,69. This is a 27% rise over last year.

Second: People who are interested in flipping vehicles.

“What’s happening in used cars right now is that there is an euphoria for them to be bought, as well as speculation on their value,” he said. Buy it right away, as it will only get more expensive.

“Tell-tale Signs of a Bubble”

This is not the auto market of your grandparents.

He said, “It shows all signs that it is a bubble.” It is supposed that used car prices will depreciate. Their prices are not meant to rise. However, they have increased their price this year by 49%.

Bianco says that auto sticker shock is indicative of a greater problem.

They are exactly right. [Federal Reserve]”I don’t want this to happen, because it is that self-reinforcing belief about inflation,” he stated.

Last December on “Trading NationBianco said that inflation may return in 2021, which could mark the beginning of a new generation.

According to Bianco, inflation will drop in 2022. However, it will slow down. Bianco says it is impossible to predict when auto prices will peak.

This could continue for another year. Bianco stated that it could continue for up to two weeks. It’s likely that the activity you see is bubblicious.