Debate about stock market, collecting

[Snapolit1]

Some very good posts in the last few weeks about the correlation between a lousy stock market and the prices realized for vintage cards. Wonder if anyone has seen any concrete examples in the auctions that have wrapped up in the last few weeks where high end card seem to have dipped since Q4 2015. The Mantles would obviously be obvious candidates as the proverbial canary in the coal mine. I haven't really seen it but I am not a Mantle collector.

[bbcard1]

The main problem with the stock market the energy sector. But this results in lower gas and home heating oil, which makes the "commoner" (points to self) feel good. There is certainly a problem with the market, but it's not as bad as something like a meltdown in the housing or financial sector so far as effect.

[jmb]

My 401k goes up and down, up and down, and so far is no where near enough for me to retire.

Had I kept my collection that I built up as a youngster from 1976 through the early 90's I would be retired today.

Mantle's are still selling like hotcakes, especially centered examples with eye appeal.

[Cozumeleno]

Unfortunately there are lots of things that are going to affect high-end transaction declines over a short period of time. We're fresh off the holidays. Maybe one of the people who helped bid a card up before isn't an active player this time around. Maybe they just made a big purchase elsewhere, etc. Heck, maybe someone just missed an auction.

I think your point in tracking high-end sales is a valid way to help determine if the stock market is affecting purchases. I just think that it has to be tracked over a longer period of time. I'm not sure we can look only to the recent auction sales and come up with any real correlation since there are a lot of other factors at play.

[chipperhank44]

According to Mr. Mantle, things are just fine in the market.

1952 Mantle Rookies
May 2015 - 52 Mantle PSA 4.5 sells for $23.9K (Heritage)
May 2015 - 52 Mantle SGC 4.5 sells for 21K (Heritage
October 2015 - 52 Mante PSA 5 sells for 31K (Mile High)
Jan 2016 - 52 Mantle SGC 4 sells for 33K (Goodwin)


1953 Topps Mantles
October 2015 - 53 Topps Mantle PSA 8 sells for $33K (Mile High)
Jan 2016 - 53 Topps Mantle SGC 8 sells for 34K (Goodwin)

[chipperhank44]

I would agree that just looking at sales is not a complete way to judge the market. Centering, Auction Marketing, Buyer's Premium, etc all come into play. But when Goodwin is selling high grade SGC examples for more than equally or higher graded PSA examples sold a few months earlier, I think the market is healthy.

[1952boyntoncollector]

Originally Posted by chipperhank44

I would agree that just looking at sales is not a complete way to judge the market. Centering, Auction Marketing, Buyer's Premium, etc all come into play. But when Goodwin is selling high grade SGC examples for more than equally or higher graded PSA examples sold a few months earlier, I think the market is healthy.

also just talking about one key card where even non baseball collectors collect isnt really a reflecton on the hobby......the cheaper cards dont really matter. (i dont care if a 300 dollar card now sell for 200)...its those 2000-9000 dollar purchases are the ones i look at..

uncommon commons where its a PSA 8 POP 15 or less card that can go in the 1000s i think get crushed if the ecomony goes down

[iwantitiwinit]

The current equity market retreat is in my opinion serious. It's the first time since 2008-09 that respected market "gurus" have felt the responsibility to warn of what they see as a true structural change. Central banks can continue to add stimulus in the form of quantitative easing to stimulate their economies however their main stimulus tool (rate easing) is ineffectual as rates are at or near zero. Unfortunately, the oil collapse in the near term will manifest itself into something much more than lower gasoline and heating costs for consumers. The coming defaults by small and mid sized u.s. energy companies portends to be a bad omen. High yield is already slipping as investors rush to exit high yield mutual funds "better credits" are beginning to suffer as well as energy related high yield bonds. Portfolio mangers have to raise cash to meet redemptions and the little liquidity that exists only exists for those better credits many of which fall in the telecom sector. This lack of liquidity is perpetuated by Dodd-Frank as banks and brokerages can now longer hold the large fixed income and equity positions on thier balance sheets if they wish to met Dodd-Frank requirements. As such they cannot bid for these high yielding securities. You can see the impact energy has had on the index by watching the high yield etf the HYG of which energy accounts for approximately 12% of the index.

If the Saudi's hold the line they will truly force more US and Canadian producers out of business. Production will eventually drop and demand will even out with supply. This will of course take time, in my opinion a year, however it could stretch out if economies continue to slow oil demand will continue to shrink and thus take all that much longer for supply to catch up. Remember the old axiom how much would you pay for that eleventh barrel of oil if demand is only ten barrels, answer not much.

In my opinion I don't let todays' rally fool me. I buy USO puts because the 2 day 12% rally in oil I feel is way overdone, we see $25 dollar oil before $35 and I buy HYG puts because the high yield index is going down.

Relative to card prices, they are going to fall. The publics' psyche will be damaged if this market drop continues and I think it will. I hope I am not kicking myself next week telling myself I could have saved myself a lot by lightening up today.

China can provide stimulus but I am guessing it will be seen as ineffectual in the eyes of U.S. investors as distrust grows and their market and monetary officials continue to fail in their attempt to design valid strategies.

Good luck.

[RGold]

h

[Peter_Spaeth]

Originally Posted by RGold

h

Agreed.

[bbcard1]

Originally Posted by iwantitiwinit

Relative to card prices, they are going to fall. The publics' psyche will be damaged if this market drop continues and I think it will. I hope I am not kicking myself next week telling myself I could have saved myself a lot by lightening up today.

China can provide stimulus but I am guessing it will be seen as ineffectual in the eyes of U.S. investors as distrust grows and their market and monetary officials continue to fail in their attempt to design valid strategies.

Good luck.

The problem with the Saudi gambit is that they may end up bankrupting themselves. They have managed to "turn off" the fracking market, but it can be restarted quickly and easily. There are some stability problems I think i am more concerned about. Outside of tourism and some minerals, oil was a key Mexican export ...that's a country that doesn't need more problems.

I think it might have some effect on cards at the top end and some of the cards that have experienced a recent run-up. Honest, the price of average stuff...the VG-EX of ex stuff from the 50s and up have kind of stabilized. I doubt they will bump much for a while.

[vintagetoppsguy]

Originally Posted by iwantitiwinit

The current equity market retreat is in my opinion serious. It's the first time since 2008-09 that respected market "gurus" have felt the responsibility to warn of what they see as a true structural change. Central banks can continue to add stimulus in the form of quantitative easing to stimulate their economies however their main stimulus tool (rate easing) is ineffectual as rates are at or near zero. Unfortunately, the oil collapse in the near term will manifest itself into something much more than lower gasoline and heating costs for consumers. The coming defaults by small and mid sized u.s. energy companies portends to be a bad omen. High yield is already slipping as investors rush to exit high yield mutual funds "better credits" are beginning to suffer as well as energy related high yield bonds. Portfolio mangers have to raise cash to meet redemptions and the little liquidity that exists only exists for those better credits many of which fall in the telecom sector. This lack of liquidity is perpetuated by Dodd-Frank as banks and brokerages can now longer hold the large fixed income and equity positions on thier balance sheets if they wish to met Dodd-Frank requirements. As such they cannot bid for these high yielding securities. You can see the impact energy has had on the index by watching the high yield etf the HYG of which energy accounts for approximately 12% of the index.

If the Saudi's hold the line they will truly force more US and Canadian producers out of business. Production will eventually drop and demand will even out with supply. This will of course take time, in my opinion a year, however it could stretch out if economies continue to slow oil demand will continue to shrink and thus take all that much longer for supply to catch up. Remember the old axiom how much would you pay for that eleventh barrel of oil if demand is only ten barrels, answer not much.

In my opinion I don't let todays' rally fool me. I buy USO puts because the 2 day 12% rally in oil I feel is way overdone, we see $25 dollar oil before $35 and I buy HYG puts because the high yield index is going down.

Relative to card prices, they are going to fall. The publics' psyche will be damaged if this market drop continues and I think it will. I hope I am not kicking myself next week telling myself I could have saved myself a lot by lightening up today.

China can provide stimulus but I am guessing it will be seen as ineffectual in the eyes of U.S. investors as distrust grows and their market and monetary officials continue to fail in their attempt to design valid strategies.

Good luck.

Some good comments about the Upstream part of the oil business, but what about the Downstream (refining) part of it? No matter the cost of oil, it still has to be refined to gasoline and other by products.

So, what happens when the cost of refining exceeds the cost of oil? Do you think the refineries would keep their doors open only to lose money? After all, plant operators/staff are paid pretty well.

I don't know the cost of refining, but I do know that no company in the world is going to stay in business long when their cost of production exceeds the cost of the end product.

IMO, that's where we're heading with oil if it continues to decline. The refineries would shut down (just temporarily) creating a gasoline shortage and there would be mass panic when people can't buy gasoline to get back and forth to work. Seem far fetched? Just look what happens after a hurricane or other disaster when people can't gasoline or supplies.

[iwantitiwinit]

Originally Posted by vintagetoppsguy

Some good comments about the Upstream part of the oil business, but what about the Downstream (refining) part of it? No matter the cost of oil, it still has to be refined to gasoline and other by products.

So, what happens when the cost of refining exceeds the cost of oil? Do you think the refineries would keep their doors open only to lose money? After all, plant operators/staff are paid pretty well.

I don't know the cost of refining, but I do know that no company in the world is going to stay in business long when their cost of production exceeds the cost of the end product.

IMO, that's where we're heading with oil if it continues to decline. The refineries would shut down (just temporarily) creating a gasoline shortage and there would be mass panic when people can't buy gasoline to get back and forth to work. Seem far fetched? Just look what happens after a hurricane or other disaster when people can't gasoline or supplies.

Not too far fetched in my opinion but it will take time for that to occur. i'm worried about what happens in the nearer term 6-12 months out. Don't let today fool you be careful out there.

[Ulidia]

Originally Posted by Snapolit1

Some very good posts in the last few weeks about the correlation between a lousy stock market and the prices realized for vintage cards. Wonder if anyone has seen any concrete examples in the auctions that have wrapped up in the last few weeks where high end card seem to have dipped since Q4 2015. The Mantles would obviously be obvious candidates as the proverbial canary in the coal mine. I haven't really seen it but I am not a Mantle collector.

In some respects, a bearish equity environment should increase the relative attractiveness of high end cards and other high end collectables i.e. an alternative investment where an investor may perceive a better opportunity for capital growth or simply to preserve capital value and as a hedge against inflation or as part of a more balanced portfolio if their current investments are focused on only one asset class (equity or property).


I appreciate that doesn't happen in reality i.e. a "feel good" factor of wealth typically results in more discretionary spending. Here in the UK, such trends are more generally related to house prices than the stock market. The UK market for soccer memorabilia (by some distance, the most collected sport here) suffered significantly post the 2008 downturn. Most mid-range items would still be at prices less than a decade ago.