Metropolitan governments restrict the number of taxis allowed on the road. They do this by issuing medallions to authorized taxis.
This creates a government-made shortage of taxis instead of allowing the market to decide how many taxis are needed on the road.
As a result, taxi medallions used to sell for upwards of a million dollars at auction in some cities.
Trump's fixer Michael Cohen owned a portfolio of these medallions.
Over time, the value of these medallions rose as the supply of taxis was not keeping up with the demand.
It was a very common practice for the owners of million dollar medallions to take out loans against those assets. Michael Cohen was one.
This was an inflated asset class created by government interference in the free market.
And then came Uber.
Uber was a giant threat to those who owned those medallions. They had a government-manufactured monopoly and they did everything they could to stop Uber from horning in on their business.
But the free market won out. WE won out.
Now those medallions aren't worth as much any more now that their monopoly is busted. And those who took out loans against them when they were worth a lot more are now upside down on those loans.
Michael Cohen is one of them. His 17 medallions are worth about 20% of what they were worth just a few short years ago.
The next time you get in a yellow cab, look for one of these riveted to the body of the cab: