This would normally have triggered a Buyers’ Strike, but the Inflationary Mindset has changed.
By Wolf Richter for WOLF STREET.
Why do people – dealers and consumers – still pay those crazy spiking pries of used vehicles? For most people, replacing a vehicle can be delayed unless some major calamity befell the vehicle. This was proven to a shocking extent during the financial crisis when consumers went on a buyers’ strike, and sales of new and used vehicles collapsed and stayed low for a long time. So why is demand now holding up at those crazy spiking prices? Because the entire inflationary mindset has changed.
My gut says that these crazy price spikes cannot continue for long, and some of this will eventually unwind, and thereby they sort-of fit the Fed’s definition of “temporary,” but they won’t go back to where they had been. Some portion of these price…