Saturday, November 03, 2007

Taxi Cartel Membership Has Its Priveleges: Returns That Have Outperformed Every Major Index

NEW YORK -- The priciest piece of aluminum in NYC, a taxi medallion to operate a single cab (pictured above - you'll see them on the hood of every NYC taxi), just sold for as high as $385,000 when the Taxi and Limousine Commission staff unsealed 155 bids yesterday. The lowest winning bid was $277,777, and the average bid was $309,000.

Here is the
press release from the NYC Taxi Cartel, aka as the Taxi and Limousine Commission:

According to the
NYC Taxi and Limousine Commission, the official name of the NYC Taxi Cartel: "In 1937, the number of taxicab medallions was limited to 11,787. Today there are currently 13,087 yellow medallion taxicabs operating in New York City. A new medallion is a rare opportunity."

Yes, a rare opportunity to join a cartel with significant barriers to entry. And cartel membership does have its privileges, including above-market rates of return.

According to the president of Medallion Financial Corporation, the leading lender to the industry, "Taxi medallions have been one of, if not the single best investment to own over the years. While the Dow has gone up 8% per year over the last 50 years, taxi medallions have gone up almost double that, 14% per year. They have outperformed every major index including real estate, gold and other stock indexes."

(HT: Ben Cunningham)

2 Comments:

At 11/13/2007 1:31 PM, Anonymous Brad S said...

That's nuthin. Check out what a limited-by-statute (but not controlled by the city) liquor license in Sturgis, South Dakota (home of the Sturgis Motorcycle Rally) costs!

http://www.rapidcityjournal.com/articles/2007/11/11/news/top/doc47364affcad88197333433.txt

The city of Sturgis understandably wants to get into the game of controlling the licenses.

 
At 4/15/2009 7:38 PM, Anonymous Russell "The Aussie" McGuirk said...

P-heh... I can get a Taxi Medallion for a lot less then that directly from the City of New York's CityStore online at www.nyc.gov/citystore or at their public store at Manhattan Municipal Buolding, 1 Centre Street in Manhattan for $20 each ($25.95 with tax each). Granted I can't use it for running a taxi service but it makes a one hell of a souvenir to hang in my garage.

 

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