The Debt Ceiling

Let’s assume the worst-the Democrats call the Republicans bluff and despite constant finger pointing the US government’s ability to borrow additional money ends. What does this mean for philately? My considered judgement, after weeks of thought and study, is that its hard to say. Conventionally, you would think that any kind of panic, such as one caused by a US government default, would cause a run on non cash assets. But one of the remarkable aspects of the last five years has been the decoupling of stamp prices from the metals- a relationship that had existed for years. In the 1970’s we had a real inflation run and gold and silver and stamps responded as alternative “stores of value”. The last five years however have seen precious metals soar with little impact on stamp prices. This decoupling of stamps from precious metals as a store of value for the end of times has been perhaps the most remarkable aspect of the philatelic market of the recent past. A default on US obligations at any level could reasonably be expected to cause a panic. Whether that panic will extend to stamp prices is something I don’t think anyone has enough evidence to predict.