Sportscards and Inflation

[cmcclelland]

Anyone have any insights into the performance of the sportscards market during a period of high inflation. I'm 41, so during the late 70's and early 80's, I was just buying cards in packs at the local store. I don't have a feel for how prices performed for the higher end sports collectibles market.

Just curious if anyone can recount how cards performed back then, and whether anyone has an opinion as to how cards might perform in the future if inflation gets out of control as many think it will.

[teetwoohsix]

Just an interesting note...in the mid 1980's,a Honus Wagner T206 was valued in Lew Lipset's Encyclopedia Of Baseball Cards Vol.3 at $22,000.00, Plank at $4,500.00,Magie at $2,000.00..........T205 Hoblitzell (no stats) at $200.00......
I know this doesn't answer the question,but it seems as though T cards-maybe pre war cards in general,seem to appreciate more and more as the years go on-through bad and good economic times.

Look at the realized prices of the above mentioned cards now........:eek:

[steve B]

Late 70's early 80's is a tough time to compare to for this hobby, and probably also for several others. For baseball cards it was the time when the hobby really got some attention and had a lot of growth. It had been around for a long time, but hadn't caught on like it did then.

More established hobbies would be a better indicator, but there was odd stuff happening in some of those as well. In coins the metal markets and the hunt brothers attempt at cornering the market on silver made things very strange. Prices went sky high since many were tied to some degree to the metal used. Then when silver collapsed so did a load of prices.

Stamps had huge price increases, but many of them were essentially false. The price guide had price increases shown to justify the sale of a 5-6 volume set every year. And buying at half catalog value was typical. (Stamp values are far more closely related to catalog values than card values) Eventially it got silly and the price guide basically halved almost everything one year so they could get back to "reality" What a mess that was! Everyone still wanted to buy at half catalog, but the new catalog was half what it had been. A tough time for all, and it took years to recover. It's back to half catalog now, but only for the average stuff. Grading has come to stamps, along with crazy prices for top examples of even very common items. And the really good stuff usually brings over the catalog price.


Through all this, the truly rare stuff and high demand items always did fairly well. If there's less than say 10 of something, or if it's something nearly everyone wants the price guide isn't really useful. Plus with everything costing more paying more for collectibles looks more reasonable.


Steve

[Exhibitman]

Cards are like any other hard asset in times of high inflation. If you're really betting on hyperinflation, forget cards and buy gold and silver.

[cmcclelland]

I agree that gold and silver will be the best place to be if we see hyperinflation. I'm just trying to decide whether quality, investment grade sportscards will also fair well in a time of hyperinflation.

For example, right now a PSA 8 1933 Goudey Ruth is going for around $17,000 and an ounce of silver is around $17. If silver goes to $30, I doubt the Ruth will go to $30,000. But what would happen to the Ruth? I mean part of me wonders if the collectibles market might get crushed and prices might go down because people essentially don't have any money to spend.

[jeffmohler]

If you will bear with a personal story....

I was eleven in 1979. I had a paper route and saved up some money that I wanted to put into my stamp collection. As I recall, a local dealer had a US #1 for sale for $77.00. I pleaded with my dad to let me buy it. In front of the dealer I said "but Dad it will cost more later" the dealer laughed and said "Pop, the kid is learning young!"

My guess is that hard assets (including collectibles) will do fine through a bout of inflation. In a bout of hyperinflation - who knows - assuming the rule of law doesn't disappear!

[Exhibitman]

Just remember: cards will get you through times of no money better than money will get you through times of no cards.

[ErikV]

By no means am I a financial advisor, but I think high
end cards have a proven track record for being a safe
asset in tough economic times. I found this chart in
an old issue of VCBC (some of the old time collectors
on the board may remember this periodical.) This chart
was dated April 2004 and provides a 30 year history
of how one would have faired investing in gold and stocks
versus a VG-EX T206 set.

I should add that today gold is nearly tripled and is
currently selling for 1107.70 oz.

The stock market today is at 10,561.44.

And the most current price for a T206 VG-EX set I
was able to locate was from 2008. Final price $105,750.
http://www.robertedwardauctions.com/auction/2007/152.html

[mark evans]

Just remember: cards will get you through times of no money better than money will get you through times of no cards.

The Fabulous Furry Freak Brothers live. Looking forward to seeing you in Baltimore.

Mark

[M's_Fan]

I think we have seen a big spike in card prices due to baby boomers getting older and spending their savings on things like cards that remind them of their childhood. More boomers are retiring, at home with their computers, buying cards that they only dreamed of as a kid.

This could continue for a few more years, but I actually worry about cards holding value in the long long term. I volunteer with the Boy Scouts and spend a fair amount of time around teenage boys. The kids I know today have never collected baseball cards, and in fact aren't interested in baseball at all, and I really don't see them as future collectors that will keep prices high.

The NFL and NBA are kicking baseball's ass, and I don't see future collectors in the kids I see today. I'm not saying that we are collecting beanie babies that will be worthless, but I just don't expect to see the huge growth that we've seen, and we could actually see decline in the long long term. That said, I think we're safe for at least 10-15 years.

[GasHouseGang]

I agree that the kids today don't seem to collect baseball cards. What I've observed at my local "baseball card/comic book" shop is that they are in there buying the game cards or the comic books. There is some action with the sports cards, but it's not usually the kids. It's generally an older person that's spending money on the sports cards. The store supports a tournament game night on Thursday evenings and there is always a bunch of kids there for that. I've seen them buy boxes of the game cards on those evenings. So the kids have money, they just don't want to spend it on baseball cards. That has been my casual observation.

[glynparson]

As they get older and their kids move out and they have more disposable income I think many will look back to cards. I do not feel that they only have a 10-15 year window. Heck I hope to be around a lot longer then that. I'm 37 so I'm one of the 30 somethings I just never left the hobby like many of my friends. But what's funny is I have some friends who have started getting back into cards, one of whom made a fortune in the stock market and now has decided to start rebuilding a collection he started as a kid. So I see the future as having possibilities. I agree many kids dont collect sports cards but MANY collect nonsport and gaming cards meaning this is a segment (vintage non-sport) which is currently seeing some growth and may have even more opportunities going forward.

[tbob]

I wish I were as sure about the future of the hobby as many of you. The problem I see is that I realize there will always be the investment guys buying cards but as we get older (and a lot more of us are in the 50-75 range than you might think), you have a decreasing pool of guys who bought baseball cards as kids because they simply loved collecting cards of their heroes on the field. The popularity of baseball, as opposed to the NFL and college football, has been steadily decreasing and with the youth of America favoring a game of more violence, more action and more glitz, I have to wonder. I've been surprised at the number of collectors here on this board in their 20's and 30's but I have a real question about the future of the hobby because it seems based a lot more on investment and value with the kids than it did with collectors who collected cards when they were young in the 50's and 60's and gladly traded their doubles (even if they were future HOFers) even up for commons they needed but couldn't find.

[barrysloate]

There's no question that young kids today do not collect baseball cards the way the baby boomers did. Buying nickel packs and ripping them open was a rite of passage for kids of my generation.

However, I do think the future for vintage cards is still good. There is something about the old cards that appeals to many people, and I think any generation can appreciate the history of the cards and the game, and develop a love for hundred year old collectibles. Even adults who did not collect cards as kids can still love a nice tobacco or candy card. Things are always changing, but their is a permanence to old cardboard.

[Mark]

The NFL and NBA are kicking baseball's ass, and I don't see future collectors in the kids I see today. I'm not saying that we are collecting beanie babies that will be worthless, but I just don't expect to see the huge growth that we've seen, and we could actually see decline in the long long term. That said, I think we're safe for at least 10-15 years.

I think it depends on where you live. Where I live, in Southern Nevada, baseball is the big deal.

[Northviewcats]

I've been thinking a lot about this subject lately. While it is true that kids don't collect baseball cards like they used to, they still love baseball. There should always be a group of fans who love baseball and as they grow older will drift into purchasing old cards. I never could afford to buy old cardboard until my kids were independent. First, I collected the cards of the players that I idolized as a kid, but as I became more interested in cards I became fascinated with prewar cards and the history of baseball. Obviously, I've never seen any of these players, but I think about them when I look at my cards.

I know of at least five people who have seen my collection and have started collecting cards.

Also, as baseball expands to other countries, so will collecting. Eventually people from all over the world will be exposed to the pleasure of collecting old cards. The Internet makes it so easy for collectors to share their love for the hobby and trade in cards. Ebay, for all of its faults, has made it easy to get almost any card you want. Our Net54 Website site and others like it will fuel the fire. Collecting will be different than in the past, but I don't see a drop off in the prewar market, unless there is a catastrophic collapse in the economy.

Best wishes,

Joe

[M's_Fan]

I just think that baseball cards' value is tied to the nostalgia of the collector. Less kids collecting means less adults collecting.

There was something magical about finding a quarter and buying a pack of Topps or other brand with a stick of gum in it. You could pick a set and easily collect all the players. Just about every collector feels that nostalgia for their yout when they collect as adults.

Even if baseball cures its ills, the adults of tomorrow will never have that nostalgic feeling that will pull them into collecting cards. Some may still collect, but less will.

That said, I'm 31, and I sort of feel like I was a part of the last generation of baseball card collecting kids. After 1989, the card companies overproduced and killed themselves, thats why they say that the Ken Griffey Jr. Upper Deck is the last iconic baseball card. So I feel like I have another 70 years of collecting, so let's not get ahead of ourselves, vintage cards will continue to grow in value for a long time!

[Exhibitman]

I started collecting as a little boy in 1970-1971. About the only influence my childhood collecting has on my collecting now is that I am happy picking up cards from that era even though they aren't rare or expensive (I mostly buy them raw at the National and try to stay under $2 a card). I haven't bought a pack in years and don't even bother with modern (post-1980) cards except the occasional autographed insert I find on the cheap for a player I like, such as the Pride of New York series of cards covering Yankees from the 1970s and thereafter. My real collecting effort is in cards that predate my existence by decades and that effort did not really take off until about 20 years ago when I got out of school and finally had disposable income to devote to it.

Nostalgia is a funny thing; it doesn't necessarily spring from a direct association with the items as a child. Nostalgia can be for a perception of America in "simpler" times, or of baseball when the grass was green, or of baseball when the athletes were working slobs like everyone else, or pre-drugs and steroids (I know...), or before the DH, or before postwar expansion diluted the game. Or it can be based on the perceived beauty of the items in question. Or you can simply have a collecting "gene" that leads you into all sorts of hobbies (visit a postcard show and see the crap (from our POV) that people collect; they've got the same bug we do). My point is that whether a kid buys packs today doesn't necessarily predict whether he spends thousands of dollars on vintage cards later. I think a lifelong love of baseball is far more likely an indicator of future interest and I see little leagues booming and attendance at MLB games at over 75 million people a year. As for other sports, if they lead that kid to later collect football or hockey or boxing cards, hey, great, to me they are the "gateway drugs" to baseball cards.

[barrysloate]

Adam nailed it. Maybe our love of baseball cards began when we were kids opening packs. The next generation may not get their first taste of collecting until they are adults. It doesn't matter when you start, as long as the passion is there.

[Brian-Chidester]

I stopped collecting in 1996, because I didn't like the designs anymore. The packs were more expensive. You got less and spent more. Way more. Collecting holograms and gold trimmed font cards and all that crap. It seemed pointless.

I remember going to a card show in 2000, and normally I didn't care about new cards by that time, but I couldn't believe the prices the dealers were charging for a new player. Remember when a hot rookie might cost you ten or fifteen bucks, and then plummet the next year? How about a $100 rookie, because it's a numbered card?

If you manufacture rarity, how can anyone hope to care about that card? Hardly anyone even knows about it!!! There's no story. And instead of there being a great, rare card every few years, there's a thousand rare cards each year, if not more. Then, the whole thing of cutting up uniforms and whatnot... I mean, it's not necessarily that kids aren't into baseball or even into sports card collecting. They buy hero cards and comic cards because they are cheap. New baseball cards are not. But it seems to me that each generation, when they come to that period where they start having disposable income, invariably enjoys collecting cards, and especially older cards.

[ChiefBenderForever]

I think for many who collect you just can't put a price on the entertainment and enjoyment you get working on an impossible puzzle. I think prices will remain where they are or drop a little. But if a new group of collectors come along they could go up a little. I hope they drop so I can add some nice pieces to the puzzle. Right now rare backs in the T206 are very hot, but this could be the result of a small handful of collectors all going after the same cards but I think the set is so popular the trend will continue. The issues outside of T206 are much tougher to find but at the sametime a little tougher to sell for a premium. Unless some of the T206 collectors step outside and start collecting the other issues like Caramel, Cracker Jack,ect, the prices realized on these issues will continue to slowly decline which is great for the collector but no so good for the seller.

[Boccabella]

One major difference about cards today is that they seem to be available in fewer and fewer outlets. Yes, you can get them at Target and Wal-Mart and some drug store chains carry them.

Even 20 years ago, though, you could still find them in supermarkets and other chains where they were often impulse buys.

When I was a kid in the early 70s, bakeries and liquor stores had them. I don't know how many card packs I would have bought had they only been available at K-Mart because we just didn't go there very often. I don't know where small town kids have access to them anymore.

It's sort of an 'out of sight, out of mind' thing for a lot of people--younger and adults-- who might consider buying some cheaper packs if they just saw them more often.

Vintage card prices have stayed relatively steady except for the rare or high grade items and I would expect that to continue because of the availability online.

[Brian-Chidester]

I mean, what are you going to buy of today's icons? A 2007 Topps Pujols is worth a few bucks, if you even know what a regular 2007 Topps Pujols looks like. There's probably 400 Pujols cards from 2007 alone... officially issued by the major card companies. I wouldn't know what I was looking for. Not like with Mantle, where a 1950s card of his is iconic as they come.

[teetwoohsix]

Great point Brian.I feel the same way about the modern cards-there are just way too many types/series with hundreds of different cards of the same player,it's just too confusing to keep up with.I actually wonder if this saturation is one of the things that makes the kids of today lose interest in collecting baseball cards?

[GasHouseGang]

Probably so Clayton. That's what did me in around 1990. There was just too much product and too many cards of each player. It got to be such a game and lots of cards that were "1 of 1", you just couldn't ever dream of collecting every card that came out in a year.

[Brian-Chidester]

My dad did marketing for Modell's Sporting Goods during the '80s and '90s, and we used to get free box seats to Phillies, Mets and Yankees games whenever we wanted them. I was a huge Don Mattingly fan, and even before the numbered cards began around 1993, by the late '80s, I couldn't keep up with all the Mattingly cards that were being produced each year. I tried. It was impossible. It pushed me right out of collecting for a few years, but ultimately led to vintage card collecting, so who knows? Maybe it will happen that way for others coming of age now.

[cmcclelland]

In an effort to try to get this thread back to my original issue - what were the reasons for the "dips" in the sportscard market in the past? What role will inflation play on this? What role does the overall economy play? I wish my memory was good enough to remember the exact years when this happened, but we all know there have been periods of time when the values went down significantly. What were some of the causes?

Also, it seems like we haven't seen a significant pullback in values for a while, and I have spent some time wondering how new things like third party grading, ebay, vcp.com, etc. will have an impact on any potential pullback. Could these new elements make a pullback worse, or could they reduce the effect of a potential pullback?

[barrysloate]

Colt- I'll offer two reasons why we see dips in the market. They are unrelated, and I'm sure there are others:

1) the economy stinks and people don't have enough extra money to buy baseball cards.

2) Certain key bidders who have an enormous influence on prices drop out and change the landscape dramatically. About five years ago there were two collectors who were competing heavily for rookie Hall of Famers. The price for these cards skyrocketed. For example, lower grade E107 HOFers, most of which are rookie cards, went from the $1000 range per card, to the $5000-10,000 range in the blink of an eye. All the other rookie HOFers, and ultimately HOFers in general, followed suit. Then they both sold their collections, and prices for many key cards took a dive.

So both a bad economy, and the absence of certain serious collectors, will negatively effect the market.

[Brian-Chidester]

Interesting, Barry.

I felt like 2001-2004 was a time when T206 cards on eBay seemed to be selling for an all-time low. It just seemed like, for a while there, interest had waned significantly, and with eBay, suddenly there were a lot of T206s available.

[Exhibitman]

In an effort to try to get this thread back to my original issue - what were the reasons for the "dips" in the sportscard market in the past? What role will inflation play on this? What role does the overall economy play? I wish my memory was good enough to remember the exact years when this happened, but we all know there have been periods of time when the values went down significantly. What were some of the causes?

Also, it seems like we haven't seen a significant pullback in values for a while, and I have spent some time wondering how new things like third party grading, ebay, vcp.com, etc. will have an impact on any potential pullback. Could these new elements make a pullback worse, or could they reduce the effect of a potential pullback?

The first big price dip I recall was in the early 1980s. Part was a nasty recession but more was the discovery of so much new to the hobby material. It just overwhelmed demand. I mean, even as a tween/young teen at the time family friends were just handing me boxes of old cards when they found out I collected. I got thousands of cards that way and started running a dealer table at monthly card shows as a result. And you could still get boxes of old cards at antique stores for pennies on the dollar in value. I think the supply situation is much more stable now--cards are not a new collectible category and the low hanging fruit of easy finds are gone. FWIW, I am pleased to see price dips now--great replay of past prices for purchases. I've been getting a lot of great stuff at ridiculously low prices...

[M's_Fan]

The recent recession we are still in definitely created a price dip, but an informal observation is that prices have swung back almost to normal just within the last few months. Just within the last few months I've started losing auctions all over the place. If only my house's value would swing back...

But in terms of inflation investments beyond cards, I've bought some gold coins from a local coin shop, and right now I'm a fan of energy related investments (ticker "VDE" and "VGENX") as well as "TIPS" funds like VIPSX.

But in case things really get bad inflation wise, you gotta have your beans and bullets squared away. For an interesting fiction read on what might happen to the U.S. in a hyperinflation full-scale economic collapse, check out: http://www.amazon.com/Patriots-Novel-Survival-Coming-Collapse/dp/156975599X/ref=sr_1_1?ie=UTF8&s=books&qid=1268410634&sr=8-1