Things are expensive, but we are not yet in a full “everything bubble”

When people are paying $650,000 for an imaginary yacht, you might think asset price inflation has got completely out of control. But there are still pockets of value left, says Merryn Somerset Webb.

A fancy yacht
Yachts – both real and imaginary – are fetching record prices
(Image credit: © Alamy)

Last week someone paid $650,000 for a pretty ugly imaginary yacht in the metaverse. I don’t propose to explain this much further (you’ll get a better explanation on Google, I suspect) but the key point is that we live in a world where people pay real money for not-real yachts. This is silly. It’s also symptomatic of the extremes you get in a world in which too much money is chasing too few goods – an inflationary world.

Not everything has gone up by quite as much (I think we can safely say that not too many years ago, imaginary yachts were worth $0). But nonetheless, knowing that US consumer price inflation is now 6.8% a year and the UK’s has just hit 5.1% is a not-comfortable feeling. They are the kind of numbers that make it increasingly hard to argue (though central bankers will have a go) that having kept interest rates at multi-thousand-year lows for over a decade isn’t having some very unpleasant side effects.

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Merryn Somerset Webb

Merryn Somerset Webb started her career in Tokyo at public broadcaster NHK before becoming a Japanese equity broker at what was then Warburgs. She went on to work at SBC and UBS without moving from her desk in Kamiyacho (it was the age of mergers).

After five years in Japan she returned to work in the UK at Paribas. This soon became BNP Paribas. Again, no desk move was required. On leaving the City, Merryn helped The Week magazine with its City pages before becoming the launch editor of MoneyWeek in 2000 and taking on columns first in the Sunday Times and then in 2009 in the Financial Times

Twenty years on, MoneyWeek is the best-selling financial magazine in the UK. Merryn was its Editor in Chief until 2022. She is now a senior columnist at Bloomberg and host of the Merryn Talks Money podcast -  but still writes for Moneyweek monthly. 

Merryn is also is a non executive director of two investment trusts – BlackRock Throgmorton, and the Murray Income Investment Trust.