Money in the Hobby
 

After perusing the early bids in the current Heritage "Platinum Night" auction, I am reminded again of the large pools of capital ready to pounce on any high graded star/HOF card. It got me thinking back to college Economics 101 with
price elasticity, supply and demand curves, equilibrium points and the like.
What factors are at play? Here are just a few random thoughts:-
1. With the stock market at record highs and the Trump tax bill safely passed, people with large amounts disposable income people are feeling confident, and this has translated into new, existing and once dormant collectors bidding up cards. Given all recent media musings that old baseball cards of the immortals is a good investment, perhaps many may look at card purchases as asset reallocation instead of reliving boyhoods.
2. There will always be more money in the country than old, nice cards. Unless there is some crisis that spooks financial markets and creates a dumping of all those beautiful Ruth, Cobb and Jackson cards, doesn't that mean that prices are elastic and should continue to rise.
3. So many great old cards have been offered for sale over the last 10 years I
wonder how many new finds can be expected and, of course, there are serious
affluent collectors who have no intention of ever selling anything; they just love their cards too much.
Personally, Heritage has some eye-watering cards on display, but I am already priced out.

Over the next 20 to 30 years I think there will be a HUGE drop in prices for cards. When boomers die out and new buyers are scarce, you'll see lifetime collections go for a fraction of what they would today.

No offense, but I'm certain people were saying the exact same thing in 1975.

Has the market collapsed for George Washington signed documents?

Has the market collapsed for rare hot rods from the 1950s?

Has the mark collapsed for vases from the Ming Dynasty?

No. Not saying every card will hold its value. That's not true for anything.

When I was growing up a few dads collected stamps and coins. Yes, the run of the mill stuff has not appreciated. The rare stuff has. And believe me people are more emotionally invested in baseball cards than airmail stamps.

I doubt it. I think the old good stuff will always be the old good stuff.

I disagree with you. I was born in the 80s and I spend a sh*t-load on vintage cards. I also have many friends around my age who spend big money on cards too. And finally, the younger folks that I see - they are in their early 20s - remind me of myself when I was younger. They come to the shows and drool over the vintage cards that they see. They ask so many questions as well. The interest is there. I am certain that once these youngsters get a bit older (and have more disposable income), they will definitely start buying these old cards.

I'm still waiting for the NYC real estate market to collapse like everyone's been telling me is inevitable (since 1970). Totally not sustainable. Yeah, sure.

No offense but real estate, stamps, coins, and car markets have nothing to do with baseball cards. I am going out on a limb, but I'll venture to say that most people collect baseball cards because they collected them as children. Being born in the 80s and using that as some justification for a future vintage market doesn't hold water. Why? Because in the 90s baseball cards exploded. You could buy a pack of cards anywhere. They were always a part of your life.

I could not tell you the last time I saw a pack of baseball cards sitting out on a counter in my local grocery store. That connection just doesn't exist for anyone being born post-2000, which is who you'll have to rely on to buy your collection down the road.

I agree with this to an extent. The exception will be that the best quality and rare pieces will continue to go up. But I do question who will care to pay anything for a mid grade 1958 al Kaline in the future.

Reason why real estate held up is due to cap rate compression. Take a look at this chart on the risk free rate; created the mother of all junk rallies. Add to that limited land supply and rising replacement cost, and you got a secular boom. Going forward, that is an interesting forecast...

http://www.macrotrends.net/2016/10-y...te-yield-chart


On expensive high end cards...I like cardz...I think they are kool.

People aren't buying nice Ruth cards and Type 1 photos because it reminds them of being a kid. They are buying because they see the appreciation over time, have a lot of money to invest, and think why not plow a small amount into something cool like sports memorabilia. Can't call your buddies over and excitedly pass around stock certificates.

I agree that Al Kaline's rookie card won't mean much to anyone in 25 year. But the stuff at the top of the Heritage catalog will hold its value and likely appreciate.

Sorry but I think that's wrong and that you're looking at it the wrong way. You're right, no one is buying Type 1 photos of Ruth because it reminds them of being a kid. But how many people bought a Type 1 Ruth photo before they bought a pack of baseball cards? I would, again, just a guess, feel confident in saying almost no one.

Pointless to try and predict the future.

Collect what you like and can afford

Drool over what you like and cannot afford

Shine the rest

The market for antique furniture has pretty much collapsed. Anyone I know who were collectors or dealers for a long period of time say the same exact thing- the antique market is dead. Not everything goes up forever.

I would say that demographic fear is probably priced in to some degree. But there will always be a market. Stamps, toys, etc. But who knows. Here is my bullish view:

The availability to sell online provided liquidity and reduced transaction costs (no longer selling at a dealer haircut like the 80's and 90's, and having visibility in real time price discovery). The grading from TPAs, has created fungibility in cards, providing further transparency to "value".

All of these factors have aided the upward stability of card prices, along with macro factors like monetary liquidity from global QE, improving unemployment, and yes a rising stock market.

So I say there are many positive aspects of card collecting that makes it a fun asset diversification. And they are just plain kool to look at.

I bought a really nice Coca Cola tray, from 1921, around 17 yrs ago. I think I paid $800 for it as it's in great condition. Then the internet hit them, and exposed their lack of scarcity, and they go for around $350 now. Sure glad I didn't go big on them at the time. :eek: Not everything goes up but I am bullish on great vintage baseball cards.

.

I agree that cards will take a dive in price but for completely different reasons. Between shill bidding, card doctors, and counterfeiting something is going to bring this hobby down.

I would love to know the % of T206's that have had nothing done to them, bet it is pretty low number. Would also like to know the % on "new" old cards in the hobby, bet that number would also surprise most.

To be fair I have been saying this for some time and it hasn't happened yet.:D

Agreed.

Will all cards keep their value? Absolutely not. But many vintage will. Just because of supply an demand.

I personally never saw Mickey Mantle play but whenever I list his cards on ebay they sell very fast compared to some other players of the same decade. I suspect the same will hold true for many other players as well.

But the modern market is a different beast, the supply is infinite. Just check the pop reports and see how many PSA 10's their are of Aaron Judge already.

Exactly. I also want to add something to this: look at the folks who spend crazy amounts of money on paintings - did they even care about art when they were younger? Did they go to museums? Take art courses while in school? No, no and no. As they got older, and their disposable income increased, they decided to just put that money into awesome things, like art.

Everything has its life ups and downs.comic were dead for years then came back like never before. What ever caused cards to go up a couple years back may happen again soon.I see and hear about young collectors all the time.

When I was a kid we had videos games and other distractions. I stopped collecting off and on for years. I’m not a baby boomer and mother are any of my friends that still buy cards. Maybe some lesser know player will fade with time like a max Carey , Paul warner, etc old hofers won’t always appeal to the future generations. As the games changes players won’t be viewed the same.

As in a football I like Benny Friedman. He had the rookie touchdown record season touchdown record, more yards then any other passer and he could run. Etc man a head of his time by decades !!! How many people know who this man is today???

You are right about Paul Warner. The same applies to the rest of the Warner brothers, too.

There will always be "authentication" issues like this, which is why TPGs are vital to this industry. There always is a side story to how much we can depend on TPGs, but that is a separate debate discussed earlier on this site.

That said, same can be said for artwork. When I was looking to add some cheap paintings to my walls, I was looking into the auctions. Above me, but you want a Jackson Pollock with high provenance, tens of millions. You want one where the auctioneer says they have no history and as is, couple grand...

Many people go to museums. In fact, I would bet it would be pretty difficult for you to find a single person who hasn't been to one. You can show almost anyone in the country a photo of the Mona Lisa and they'll know what it is. That could not be said for any baseball card. I also doubt anyone buys art just to spend money on something. It is true that people will invest in artwork, but at it's base level art has a utilitarian purpose that baseball cards never will.

the collecting gene, either you have it or you dont

I could give a rat's rear. I plan to be out-of-here by then.

There are some amazing 1926 Cricketeer cards from England on eBay for ridiculously cheap:

https://www.ebay.com/itm/Luddington-....c100752.m1982

I sometimes get concerned when I think about what it would take for baseball cards to turn into cricket cards over the next 100 years. English cricket was popular enough at one time to spark a marketing campaign based on cigarette inserts, which based on this sale made its way all the way to Australia (does anyone collect T206 cards in Australia?).

And what about the T205, er... T80 Military set, referenced in another thread today? Why are these cards so cheap but we lionize baseball men? Is there a surge in military cards coming in the future? Just as beautiful as the T205 set (which is not a compliment from me, but you get the gist).

https://www.ebay.com/itm/1910-T80-To...kAAOSwVL1WB45f

But, then I remember what John Maynard Keynes said: "In the long run we are all dead."

And the Warner sister, Dot.

I disagree with your opinion on the utility of cards. As stated earlier, the TPGs and online venues have increased the utility of the cards. For art, its a 1 of 1 market (sans the giglees, lithos, and other crap out there). For cards, there is more than one and a standardized grading system, so you have a baseline of what the market is. That baseline is accretive to the utility and thus value of the asset.

But hell, as others say, who cares, we are all dead eventually (and what else am I going to do in the meantime).

Collecting should be all about "fungibility". If you no longer have the ability to have fungi with your cards, you should consider getting out of the hobby.

Brian

By utilitarian I meant that artwork serves a purpose beyond being valuable. We all have homes, I assume we all have something on the wall too. And that doesn't take into account other forms of artwork, like furniture, lawn ornaments, comic books, comic strips, cartoons, posters, t-shirts, shoes, logos, etc.

Bingo.

Prices
 

I'm still waiting for Beanie Baby prices to rebound.

:D

Haha see I already forgot who Paul waner was.

Was an article last year about the absolute worst things to have collected in the last 50 years. Had to send a copy to my parents as they touched most of the bases. Hummels. Yadro. Norman Rockwell plates. Check check check.

Beanie babies were there of course. But the biggest disaster was Thomas Kinkaid paintings. What a debacle that turned into. People were paying big bucks for those and the market just got saturated. Every shopping mall in America was selling them. Poor guy died before it all collapsed. Probably for the better.

I have baseball paintings, baseball pictures, baseball posters, uncut sheets of baseball cards, baseball autographs and other baseball display items. Most of what you listed, I would consider worthless. I would agree that baseball cards printed in larger numbers, most postwar, will probably see lower values in the future. Top names in higher grades will continue to increase in my opinion.

Worthless in what way? What does that mean? How are shoes worthless? How is a house worthless? Do you not consider architecture to be art? Advertisements are worthless? Do you wear clothes? Do you have furniture? Do you watch television?
Go to the movies? Art affects your life every day.

Seeing as though our economy has been stagnant at best for the past 2 decades, with the recession in the middle, and card prices have still increased, I'm going to say I'm bullish on the sustainability of the card market. I think as our economy grows (which is should) over the foreseeable future, these cards will just continue to increase. Maybe not your commons, but HoFers and rarities? Heck yeah. I'm 23 and know and handful of people my age that are collecting Pre-War. The hobby isn't going anywhere but up in my opinion, as long as the economy is solid.

Enjoy the present, hope the best for the future, and Make the Hobby Great Again. :)

Lawn ornaments, comic books, comic strips, cartoons, posters, logos. I wouldn't pay a penny for any of that stuff. I would throw away advertisements unless they had a famous baseball player on it. The idea that everyone has the same collecting interests is silly. There will always be people collecting baseball and sports items and who have no interest in items like you listed. Shoes and t- shirts are meant to wear, not collect. I throw them out when I am done using them. I watch sports on TV. I rarely go to the movies, I consider them a waste of money. Art affects your life, not mine.

The economy has been improving, look at unemployment, stocks and interest rates for indications...

But Bingo on the youth collecting vintage. There are tons of facebook groups trading and collecting vintage. Albeit they are looking for beaters, when they get older and have more disposable income, they will be looking to upgrade their beaters...

I'm sorry I didn't make my post more clear. The economy has absolutely been improving recently, but for the good part of two decades, it was in decline/stagnant, yet prices still increased on these cards.

I think my generation, as much as I try to distance myself from them, learned from their parents' errors when it came to card collecting, and are going for the timeless, classic cards that are no longer being produced and show true history.

I understand the sentiment behind Adam's point on it being "pointless to predict the future," but it's hard for me to think it's pointless for not having some thought about the future stability of these assets. If I had no regard for future value, I'd feel like I'd be doing my family a great disservice by being reckless with my spending.

I, like others, am bullish, at least when it comes to high-eye-appeal HoFers from popular sets. The biggest spenders I've met in the hobby happen to cluster in age from late 30s to late 40s. These dudes have a deep passion for the sport of baseball and for collecting. It's not a phase for them. They will outlive boomers. It's a small sample size, but I think it's indicative of a bigger trend of dudes coming into money and trying to reconnect with meaningful sh*t from the past. Bottom line, I think we'll be fine for at least another 40 years; at least that's what I tell myself and my wife.

I've been leery on the hobby for years mainly due to the potential fraud. But...the hobby has survived.

As long as the economy doesn't nose dive like it did in 1929, and that wont be happening anytime soon having unemployment hit 40%, the sky is the limit.

And even think there is more upside. What if a TPG could actually capture the strengths of the two that exist now? A company that could grade and turn around cards like SGC and another with the marketing/registry of PSA and have it lead the way on fraud protection? It would blow even more doors off the barrier to entry in the hobby. I also think lots of people are tired of stocks and traditional investments...they're just boring and the fees associated with them are real...unlike cards.

Everything will cycle, everything will have it ups and downs but over the long term the general hobby will be fine.

Also...art is everywhere and affects us all whether you engage or not IMO.

It's really no different than the stock market. There will be peaks and valleys, somewhat in line with the rest with the impact of the economy on other investments. Newer cards and memorabilia are much more sensitive to flavor-of-the-month and people "short" them. Do you think a Tom Brady SP rookie is going to continue to get $15k in the future? Maybe, maybe not. But, I don't anticipate a bunch of new pre-war stuff getting discovered and, with the internets, there is a lot better understanding of how scarce some of the issues really are. Don't expect T206s, 33' Goudeys, or 52 Topps cards to tank anytime soon. Sure, there will continue to be fluctuations as the economy pulls back or surges forward. But, a lot of the vintage stuff is going to continue to rise over time.

It seems we had this discussion back in 2008-2009 when the economy tanked. The smart guys got some great deals :)

Utilitarian means something has a practical use. My point was artwork is not limited to million dollar paintings. You wear clothes a person designed. You live in a house with furniture someone designed. You read books people wrote. That’s all art.

I find this discussion fascinating. I wish I was collecting in 2008-2009 but didn’t get back until last summer.


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Packs - store of value is also a utility.....I.E. gold, absolutely worthless, cant even use it for industrial reasons like a diamond, yet the shiny stuff retains value.

My cards have been profitable enough for me to continue in the hobby. Looking back at what I paid for them, I probably wouldn't still be in the hobby if they were now worth less. They are historical, neat & cool, but if you're losing money, you kinda like stop.

When big money comes in, the acquisitions are mostly blue chip cards. That's what you want when you drop some serious (for you) coin. Long term? Just hope the trend continues.

Actually gold is one of the best metals there is when it comes to making an alloy durable. Gold is a mechanical ingredient in many things, including your smart phone.

i did not know that, thanks.