1. Student Debt - It is non-renounceable. Bankruptcy does not clear it.
2. Oil and gas companies - the entire "fracking revolution " has been funded by loses from bondholders.
3. All Private Equity debt - the basic business model is broken.
1. Student Debt - It is non-renounceable. Bankruptcy does not clear it.
2. Oil and gas companies - the entire "fracking revolution " has been funded by loses from bondholders.
3. All Private Equity debt - the basic business model is broken.
A more common example is the first generation Toyota Tacoma (00’-04’) that is currently going up in price, I’ve seen closing prices at $15k in the last year. Small trucks are now extinct and this particular model is proven to be absurdly reliable, but who would have predicted that 10 years ago when these were selling for $3k-$5k?
Diesel trucks used to be grossly overpriced too but now that most of the older stuff has aged out and the "new enough to still be kinda nice" market segment is full of emissions era diesels the crazy pricing has mostly gone away.
They're comparable to the Jeep JK and the WRX STI or a performance trim Mustang/Camaro but for different demographics. Anyone could tell you that they would hold value better than average when new.
Losing less value than average is not all that remarkable. Gaining or failing to lose value is exceptional and subject to the whims of consumer culture (see my tangent about diesel pickups). Jeep Wranglers used to be like that but as the 4dr JKs hit the used market it calmed down a lot. Old full size Broncos are probably about to stop losing value if the rumors of a new fullsize are to be believed.
Also I toned down the language in the original a little.
Anecdotally, I purchased a used Tacoma in 2011 for a few thousand dollars as a family workhorse vehicle. I sold it for nearly double five years later with only making regular oil changes. This really changed my impression of the used car market and have since started a side hobby buying and restoring "almost-classic" vehicles.
That's no longer a serious problem (and is in fact an opportunity for the majors that have taken over). That's several years in the past as a large risk. At the scale of the US economy and its wealth, the remaining debt implosion risk in the fracking (Permian etc) segment is trivial.
The fracking buildout is over and consolidation has already largely occurred. There are only a few relevant small players left to be acquired by the majors. Companies like Exxon, Chevron, ConocoPhillips, Devon, Pioneer, Apache, Concho and Occidental own everything. And a few of those are guaranteed future acquisitions for the big guys, including Devon and Apache. The majors have no real capital problems when it comes to affording to deal with swings in the price of oil, unlike the early years of the fracking boom when dozens of smaller firms still mattered and were highly leveraged. And at this point we know where most of the oil is at in the prime fracking zones, the little wildcatters served their purpose.