Hagerty. “Inflation … Collector Values. ” John Stoll. May 2021.

were only temporary - the supply shortage caused by manufacturing and logistics delays were not in fact lasting diminishing supply factors. Today, speculators chased commuter cars, but back then it was Ferraris that speculators were buying. 14

In 1987, when the stock market took a terrible dump, speculators got very nervous about the stock market, and they decided they wanted hard assets. Back then, it was really just a whirlwind of huge appetite for high-profile cars from people in mainly the financial sector, who didn’t really know anything about cars. 14

But perhaps the most important factor that led to the crash in the ‘90s is also the one that differs the most from today's market. In the '80s most people were borrowing heavily to buy Ferraris. Lots of car collectors weren’t collecting with their own money, they were borrowing at very high interest rates. Once prices started to dip, the excessive borrowing with rising interest rates meant these buyers found themselves in a value hole and they were forced to sell to keep the banks happy.

That helps explain why the collector car market corrected but didn’t crash after peaking in 2014. From about 2005 to 2008, the industry again started to lend on some very valuable cars, but when the global financial crisis hit, it all dried up. Banks suddenly didn’t want to lend, and many countries tightened lending rules. The lending market almost closed for a while as a result, and vehicles had to be purchased with cash rather than debt. This meant that after the prices peaked again in 2014, the decline was soft and avoided a crash. Sellers who didn’t get offers they expected simply shrugged and took their cars back home. Few were forced to sell by their banks, and that stabilised values. 13,14

Today’s collectors overwhelmingly

own their own cars, which means the pressures of rising interest rates won’t result in forced sales that flood the market with fire-sale supply. 13,14

Ferrari Market Index, 1973 - Present

1,15

1988 - 1990: LIVING IN A BUBBLE

1980 - 1987: MOMENTUM BUILDS 1990: IT ALL COMES DOWN