BEWILDERED

When Jimmy Carter was President of the United States, you could buy a very nice new car for $5,500. That was up from $3,500 in 1972, four years before he won the election.

Going into 2022, the price of an average new car is about $45,000. Let’s make this simple for those of us who are thinking in terms of multiples--$4,500 to $45,000…10 times.

Meanwhile back in 1977-1981, the highest taxes for my clients who were high income, like physicians, was 70%. Interest rates hit 21% or more, inflation was even more than it is today, Americans were held hostage in Iraq, farmers were going broke (Willie Nelson started Farm Aid in 1985) and Jimmy Carter was bewildered. No idea what to do to make things better. 

That has, until now, earned him the title of worst American president.

An opinion on this stuff is like belly buttons, everyone has one, but think of the world to come—an average car will cost 10 times as much, say $450,000? Interest rates are low, so the inflation damage hurts retirees, those on fixed income and people with cash investments disproportionately. Instead of $10,000 an acre, Nebraska farm land will sell for $100,000 per acre. Our good friend Butch Shadbolt said that he never bought a piece of land that would “pencil out,” you had to believe in inflation.

Make your own conclusions about residential real estate and the stock market, not going there.

The real kicker is that with all the similarities to the late 1970’s and early 1980’s, the current president and his administration are bewildered. No clue what to do about 2 million illegal immigrants into South Texas. Maybe call them “undocumented” and that will help? No idea what to do about lawlessness in San Francisco (the DA will not prosecute for looting and shop lifting, so people grab a TV and run), Portland, Chicago, Baltimore…and so on.

My guess is that Jimmy Carter’s title of worst president is in jeopardy.