I’ve spent a lot of time wondering about the seemingly outrageous prices for art, diamonds, collectibles, antique automobiles, New York real estate and apartments and other tangible items seen at recent auctions. Why are people paying these prices for these items? The buyers are obviously the world’s most wealthy folks, and it seems to me that they are discounting future inflation or even hyperinflation. When somebody pays $0 million for a Warhol painting, he or she must think that the painting will be worth $60 million three or four years from now. Thus today’s auction prices may be considered the normal prices three to five years from now. The wealthy of the world are preparing for the future, a future that they are now discounting through super-high prices
If current auction prices represent what the wealthy think we will see three to five years from now, why hasn’t gold moved up ... Log in or subscribe to continue reading.
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