The Strangest ‘Safe Haven’ Asset Ever?
Not so long ago, companies that make recreational vehicles were great indicators of market tops. Since RVs were frequently the final pointless toy that people bought (after motorcycles, boats, and massive pickup trucks) in the debt orgy that defines late-stage credit bubbles, booming RV sales often presaged a stock market crash – which then sent the shares of RV makers plummeting.
Put another way, an RV maker trading at its all-time high was a classic short sale candidate, while the best time to buy an RV was in the depths of a recession when the idiots from the previous paragraph had to sell their giant toys for pennies on the dollar.
But that’s not true anymore. As houses soar in price and paychecks fail to keep up, RVs have become the dwelling of last resort for people on the slippery slope to homelessness. With tens of millions of Americans now on that slope, the demand for RVs actually rises during hard times.
Watch the poignant but riveting movie Nomadland for a sense of this emerging “van life” subculture.
Better than gold or bitcoin?
As this is written on Tuesday Sept 28, most US stocks are plunging in response to higher interest rates and general global chaos. Recall that in the old normal this kind of day would be brutal for RV stocks. But RV maker Thor Industries is spiking on a big earnings beat and the sense that for this sector the good times are just starting.
The lesson? Scared money that could be pouring into gold or bitcoin on such an ominous day is instead moving into “Third World” plays like the RV makers, on the assumption that a lot of people are about to get a lot poorer.
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