vintage cards recession proof?

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Posted By: Peter Iannicelli

Now with the economy coming into a recession, does anyone know what happens to the prices of vintage cards? I would assume that it would become a buyers market, with about a 15% drop, and I am beginning to see a bit of a decline in some big t206 HOFers. Does anyone agree?

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Posted By: Jerry Rucker

Wouldn't a 15% drop be a Buyers market. I'm all for that.

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Posted By: Peter Iannicelli

ahh your right, a typo.

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Posted By: Ken McMillan

would depend on the card. Some cards would hold their own while others would fall some.

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Posted By: Doug

"I am beginning to see a bit of a decline in some big t206 HOFers. Does anyone agree?"

I agree it does seem like the prices have dropped a bit on them. I guess time will tell if it's actually a downward trend or not.

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Posted By: JimB

High grade T206 commons were hotter than HOFs last year. If a common in an 8 can go for 2k, I would think all the HOF should be 2-25k, with the Cobbs, Johnsons, etc. quite a bit more. But the registry seemed to skew the value of T206s relative to one another.
JimB

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Posted By: Frank Wakefield

Some investors move their investing dollars clear of stocks and bonds in a recession (we're not in one, nowhere close, months to go if it does happen), and move money toward other areas. Real estate, art, metals... Some folks will buy baseball cards and label it investing, but that is a really poor investment, for reasons I've previously stated. Still, some money will go toward cards.

Some folks who've bought cards on credit cards, or are somewhat in debt, might sell cards to dig their way out of debt a bit. So I'd think some cards will surface, offered for sale.

My belief is that cards will just about hold their own for the time being. Neither significantly up, nor down.

About 8 months from now, if we have gone into a recession, which I doubt will happen, then fewer folks will have disposable income, there won't be as many dollars out there chasing cards, the price of some cards would drop a bit. But that is months away if it happens at all.

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Posted By: Jeff Lichtman

FWIW, high grade commons and HOF T206s have gone down in value pretty considerably over the past six months.

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Posted By: Chris Mc

Frank, I really hope you are correct but I think we (U.S) are in big trouble. I really don't want to go too far off the original post but the banking/financial sector is in huge hot water. Vintage cards may drop off and I feel bad for those who use them as an investment but the true collector wouldn't care if the card was worth $10 or $10,000.

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Posted By: barrysloate

I think some areas of the market got unrealistically high, and high grade T206's was one of them. We had some threads about a year ago regarding the crazy prices that 7's and 8's were getting, and maybe they really were crazy after all. Those are the kinds of price declines to expect in a recession.

But rare cards still seem to be holding up pretty darn well. Let's see how the next six months progress, as we may see some new patterns.

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Posted By: David Davis

by sending in your PSA cards for a half grade bump. Who said cards weren't a good hedge against inflation?

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Posted By: barrysloate

Excellent point David.

The economy goes down 10-20% in 2008, but all those half grade bumps increase the value of your collection 10-20%. It's better than gold.

Speaking of gold, it hit $900 an ounce recently. I think it's going to top $1000 in the near future. That's only good if you have some, because otherwise it's a very negative sign.

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Posted By: Joe D.

"Speaking of gold, it hit $900 an ounce recently. I think it's going to top $1000 in the near future. That's only good if you have some, because otherwise it's a very negative sign."


I have been giving a lot of thought to buying precious metals, even at these high prices.
My fear is that much of the price jump has been due to devaluation of the dollar.

I don't know if the US plans on strengthening the dollar any time soon - but if they did, I would guess that would cause the precious metals prices to plummet. I wouldn't want to get caught up in that.

There are many people much more learned than I am on the subject - hopefully some N54ers are and someone here can guide me.

feel free to email me if further discussion is too OT.

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Posted By: davidcycleback

I am no precious metals expert and don't pretend to be one. However, I was once told the best way to invest in precious metals is not to buy the metal itself but to invest in good companies that produce them.

Of note, N173s have gold. Copper has gone up and T205s have copper. (Mostly a joke, as I don't image they have enough to invest metal-wise).

I had a baseball All-Star ring, and whether rational or irrational, I felt a bit longterm safer knowing it was made out of gold and diamond. If worse came to worse, I figured the lowest point for gold still had to be higher than the highest point for cardboard. Besides, I don't even know how you melt down a baseball card. Of course, I don't know how to melt down a diamond either.

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Posted By: Ken McMillan

we should all invest in cxw. it is a company that manages prisons. There will always be crime and it will probably increase is the country goes into a recession. also we could invest in waste management companies, we will always have garbage. recession proof ideas????

Ken

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Posted By: barrysloate

Joe- I agree $900 is a risky entry point. If you bought a year ago, you did great. But since it is currently hovering at an all time high, of course it is may fall.

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Posted By: davidcycleback

Build a steel time machine, go back a year and trade it in for a gold one. Bring a few T206 HOfers to pay for gas money back.

My childhood friend's dad was a radiologist (doctor who takes X-rays). When the price of silver went up in the 1980s, my friend's dad got into a fight with his partner over who owned all the old X-ray film in the office. Old film contains silver.

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Posted By: Corey R. Shanus

I think true rarities (as opposed to condition rarities) are great hedges against economic downturns. For the best of them (e.g., a 4BH Kelly -- Hi Leon), many of those cards are so rare and so desireous, whenever one should come available, collectors will do their all to snatch it up; there may never be another opportunity. Perhaps in good economic times they might fetch a bit more (though even there because the demand is so great it might not matter), I would think in any economy they will always fetch enough to prove themselves great long-term investments.

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Posted By: davidcycleback

If something can go up, it can go down.

Note that the current steroids scandal has convinced many baseball card and memorabilia collectors to move to the Pre-Steroid era. The value of Roger Maris autographs has multiplied since the day Mark McGwire broke his record. Hank Aaron is more admired since Bonds broke his record. The market value for Aaron game used material has gone up, while Bonds game used has gone down! Same trend for Aaron and Bonds autographs and baseball cards. Many collectors of current star game used jerseys will move their scarce dollars back 30 years. For a long time, I've heard game used experts say that many old game used jerseys are underappreciated when compared to the mass produced Manny Ramirez, Big Papi and Derek Jeter stuff ("Lot of 100 Derek Jeter game worn wrist bands. For bulk rates, call."). But it is only now with the steroids issues that many modern collectors are seriously looking at the older material.

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Posted By: barrysloate

Dow is down 440 points in first 5 minutes of trading. Will this have an impact on the hobby if the market goes into a freefall?

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Posted By: Joe D.

"Dow is down 440 points in first 5 minutes of trading. Will this have an impact on the hobby if the market goes into a freefall?"

In a word: no.

possibly a more pertinent financial move for the hobby was today's fed action...
the fed cut the rate 3/4 point.
they will support/save the real estate market as best they could.

Time to take advantage of the new rates - refinance the house and buy that Wagner!

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Posted By: barrysloate

I'd rather pay off the mortgage and be the one selling that Wagner!

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Posted By: Joe D.

if I wasn't married, I would be living in a cardboard box eating ketchup sandwhiches.... but I would be cuddling a T206 Wagner.

Thank goodness my yang has a yin.

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Posted By: paulstratton

More cuts to come? Oil needs to come WAY down. Like others have said...I think the good stuff will hold up well.

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Posted By: Anonymous

"if I wasn't married, I would be living in a cardboard box eating ketchup sandwhiches.... but I would be cuddling a T206 Wagner."

I hear you, bro! If it wasn't for the better half I'd be living in a cave too but the cards I'd have...

Sic Gorgiamus Allos Subjectatos Nunc

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Posted By: scott brockelman

The market downturn may actually drive vintage card prices up. In most down markets investors often seek other avenues to make gains, turning to hard assets such as real estate, art, precious metals etc. all of which are used by the wealthy as investment vehicles, vintage cards are just another safe haven. Specifically I would be speaking of higher dollar cards, and/or condition rarities, not average grade t-cards o such.

I think most on this board would agree if they had $100 or $100,000 cold cash to invest right now they would be more prone to put it in cards that they know and love than the uncertainties of the market. Make no mistake the market will come back and come back stronger and higher but it will be many months or perhaps a year or 2 before that occurs. Meanwhile you could be holding a cherished piece of cardboard and realize a large gain at that time as well. Only one caveat with vintage cards, you HAVE TO BE ABLE TO SELL them, many fall in love and can't bear to reap the profits when they should sell out.

Scott

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Posted By: barrysloate

Scott- I'm not sure I totally agree with you. We have seen in some instances people taking money out of stocks and putting it into hard assets such as baseball cards.

But if we are in a recession some may want to put some money in the bank. This isn't a bad time to have some extra cash on hand.

I still think rare cards will do well, but it may be a time for some collectors to take a breather. It will vary with each individual.

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Posted By: Jeff Lichtman

Guys, I really don't think if the market tanks -- and hysteria hits investors big and small -- that anyone with cash will be putting it anywhere but in a money market fund until the distress subsides.

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Posted By: boxingcardman

Imagine that

Sic Gorgiamus Allos Subjectatos Nunc

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Posted By: Jason L

Um, nope!

no reason to think so.
They are a store of value just like everything else that someone wants to call an investment.

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Posted By: Lance

I have agreed with Jeff on this one the whole way. PSA 7 T206 commons were $700-1000 6-8 months ago. You can buy them all day for $400 delivered. I do think we will see a slight increase with tax returns rolling in, but I don't expect the huge spike we had last year. I know a couple of people who bought large groups of raw before the decline and before the cards could get graded, the market disappeared. Big losses. I hope it just stays stable for awhile.

Lance

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Posted By: Joe D.

Even in a recession - I don't think there would be a problem finding people comfortable enough to buy vintage cards. The buyers will be there. Heck, judging by this board - vintage card collectors are mostly lawyers and doctors (recession resistant).

The issue that could effect the market is on the supply side.

If too many people 'need' to sell at one-time... its bargain city.

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Posted By: PC

Holding high value cards -- many of which have gained in value in just the past three or four years -- and expecting them to either retain all of that value, or even increase, seems unrealistic. Even in good times.

But the recent price drop of T206 7s does answer the question of what that hissing sound is that I hear from the PSA registry -- it's the air rushing out of all those slabs.

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Posted By: Frank Wakefield

What I've set out below is my personal perception, and may well not be reality, so please don't take offense....


A CARD COLLECTOR's only concern about the price of a card is how it will affect his buying. He focuses on the expected costs of the cards he lacks. He rarely gets caught up in the current value of the cards he has.

A CARD SPECULATOR focuses on the value of a card based on what other folks are paying, in hopes that he could sell his card for that or more. He cares not about the value of cards he lacks. And it doesn't matter all that much who the player is, or which set the card is from, it is all about the potential sale value.

A CARD INVESTOR is delusional.

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Posted By: steve

People have stated the true rarity would hold its value better than most. What qualifies for a true rarity? And if its truly rare, you will have a tough time investing because you will not be able to find one.

When the Skydash rarities sold in December, it sure seemed like they should have gone higher - they should be classified as true rarities.....they did not get the high price expected.

Prices seem to be more demand driven than supply - I am painfully learning this as I become a more experienced hobbyist. Perhaps the highest demand in our vintage hobby is for T206's. And of course the most desired T206's would be high end major HOF'ers.

If the market is currently giving a 20% discount on these cards, maybe pick up a Cy Young portrait or Cobby or Matty in NM or better.

Toss it in the safe deposit and smile when Wall Street is not.

steve

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Posted By: Joe D.

"A CARD INVESTOR is delusional."

I loved that line.

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Posted By: barrysloate

I think it's hard to generalize what some people will do.

Given two collectors with equal amounts of disposable cash, one may still buy baseball cards unabated, and the other might take a break and just bank it. Much has to do with the personality of the buyer.

But no matter what spin you put on it, the market is very volatile and there are a good number of people nervous about the short term economy.

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Posted By: barrysloate

I wanted to respond to Steve regarding the Skydash Collection. A number of people expected to see higher prices on the Tin Tops, but I was not surprised by the results. The rarity and condition was there, but that is a very thinly collected set. So less than stellar prices were not shocking.

And if I may shift gears for a minute, I have an auction closing the day after tomorrow so of course I am concerned with what is going on today. I see my better quality material holding up nicely, and I expect great results by the end. But my second tier material isn't doing too well, and I suspect there will be some disappointments. That's the market, what can you do?

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Posted By: Corey R. Shanus

True rarities for purposes of best holding their value and turning out to be good long-term investments are those that are BOTH rare in any condition and have a high demand. That second requirement (high demand) is what IMO somewhat put a damper on what the Skydash Thorpe went for. While obviously it is sensational card, I do think it could have approached/hit the six-figure barrier had it had more aesthetic appeal and been from a more popular and well-known issue.

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Posted By: barrysloate

Corey- regarding the E270 Thorpe, I would venture to say there were many collectors with rather big collections who were not even aware that such a card existed; likewise; I fielded several questions from people who asked the difference between a Colgan's Chip and a Tin Top. It's possible the Tin Tops suffered from being so rare that they were on nobody's radar.

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Posted By: PC

I actually agree with Frank. Well stated.

One nuance about the card speculator: "He cares not about the value of cards he lacks." I think that might not always be the case, because if the speculator thinks a card will go down in value, he may avoid acquiring it. I guess, in that sense, he cares, but not as much compared to the cards he owns.

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Posted By: scott brockelman

It appears I am incorrect in my assessment of top quality rarities holding their own in a stock market downturn.

I am willing to put my money where my mouth is, who has cards of this calibre that they want to sell me?

Please no T206's in 7 holders, those aren't even close to qualifying, they are commodities which have probably not seen the bottom yet, even 8's would not be a good bet.

Scott

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Posted By: steve

Scott B. - interested?

S74 Silk, Mathewson colored, GAI 7 $2,500. Finest I've ever seen.

S74 Silk, W. Johnson colored, GAI 6 $1,500. Outstanding and truly rare.

Colgan's Tin Tops, Honus Wagner, SGC 60. $8,000. Only one ever graded until Skydash.

Colgan's Chips, Honus Wagner, PSA 8. $2,600. Blazer. Wow!

1926 Exhibits, Babe Ruth, pose, PSA 4. $1,800. Only a couple graded higher.

steve.

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Posted By: barrysloate

Scott- looking for rarities?

Try www.sloateauction.com. Thank you.

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Posted By: davidcycleback

Observing experienced baseball card collectors talking about stocks, an investment banker commented that the collectors knew a whole lot more about baseball cards than NYSE companies. He said their knowledge was more suited to picking baseball cards as investments than stocks.

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Posted By: leon

I think there are many variables in the "recession proof" qualities of cards...or any antiquities for that matter. I tend to agree with your assessment overall.....

Also, to Frank's points....I think we can have our cake and eat it too.....I can be a collector, speculator, and investor....all happily rolled into one....mostly a collector at this point though....

best regards

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Posted By: scott brockelman

Steve -Very nice items, unfortunately not exactly what I would be looking for as they only satisfy one of the criteria given by Corey above. They are extremely rare and low pop, but silks, colgans and exhibits both have low collector bases.

Barry -I have looked at the auction. Many very nice cards and quite a few fit the bill, however I did not see many underperforming. It appears the majority of the 1st half of the auction is pretty solid with ample time left. I did find one under priced card and placed a bid.

Scott

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Posted By: barrysloate

I just saw Scott, thanks. That was pretty good salesmanship, don't you think?

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Posted By: scott brockelman

Based on your auction, other than a few lots, given the current market conditions, the prices seem pretty strong and you still have the final days to go.

Good Luck to you, your consignors and the winning bidders.

Scott

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Posted By: barrysloate

Thanks Scott. I still think there will be some soft spots, but that's a sign of the times.