Changing of the Guard: The Commoditization of Sportscards

[Aquarian Sports Cards]

That's the only remotely sensible theory Ive heard

[vintagesportscollector]

Originally Posted by Rich Klein

Welcome to the board. For those who don't know her - Marion is a long time well respected card dealer

Rich

Welcome! 7 years to make your first post...that's a new record.

[bobbyw8469]

More Kool-Aid to drink! I remember when this was $1,000 card not too long ago!

http://siriussportsauctions.com/1953...OT1019414.aspx

[swarmee]

https://forums.collectors.com/messag...&enterthread=y

Move over Titus, there's a new hoarder in town...

[ls7plus]

Originally Posted by BeanTown

One possible thing to do is stay ahead of the curve and buy cards that are not in play yet. When Mantle got hot, who was buying Rose? When Clemente got hot, who is buying Robinson (Jackie)? If Ruth gets hot then buy Cobb and then if Cobb is hot go to Wojo and etc... Tons of cards and everything happens in cycles.

Now you have the idea! There are far too many '50's and '60's Topps cards for the market in low to middle grade to keep going up--at best, drawing a comparison to coins, the market will be cyclical for such items. There are also a lot of far more rare and even more significant cards from the 1910's, '20's, 30's and '40's than Clemente or Rose rookies in "8" or better, which are quiet right now. Not wanting to offend, but I certainly hope that no one on the board thinks that either of the above two rank right near the top of the all time best at their positions (Clemente is 6th in JAWS, and far behind those ahead of him, including Ruth, Aaron, Musial, Ott and Frank Robinson; Rose is 5th, but substantially behind those ahead of him also)--should you believe that, take the time to go to baseballreference.com and view where such players stand according to JAWS (based on both peak and career wins above replacement), or Bill James Historical Baseball Abstract (in most cases, the two agree quite nicely).

Take a tip from John J. Pittman, who bought rare and significant coins during quiet times for the items he sought in the market, rather than what is supernova "hot" at the moment--demand almost always comes around to what is truly rare and significant, with value appreciation tending upwards in a very nearly linear, rather than cyclical fashion. Pittman focused on such items, never able to afford the true "trophy coins" like the 1913 Liberty Head nickel, 1894 S dime, 1804 silver dollar, etc., etc., and over five decades, put together a collection which was auctioned for nearly $40 million.

I also don't think so-called "condition rarities" in cards will parallel what those in coins have done when the subject is those from the '50's and '60's. There are just too many (THOUSANDS) slightly lower grade cards to drain off demand among true collectors, and the latter are what matter in the long run, not the 10-30 investors Brent speaks of. Buyers who are purely investors tend to leave the field after a relatively short period of time, during which they DO exert significant influence upon the market, while collectors form the real lasting demand. Once the investors have moved on to other areas, however, the prices of even higher grade superstars from the '50's and '60's will fall to the level of the true, long-term collector market for such items. Inflated values for the lower grade examples, however, will lead the downward correction--use your head: if there's several thousand examples of any card in low grade, paying five figures for one simply does not make sense!

Best of luck in your collecting,

Larry

[ls7plus]

Originally Posted by ALR-bishop

Wish I was younger. I am going to miss all that stuff

LOL. +1!

Hi, Al,

Larry

[ls7plus]

Originally Posted by scotgreb

I was following this Gibson . . . A mid-grade that sold for nearly 10x VCP.

http://www.ebay.com/itm/351767229283...%3AMEBIDX%3AIT

Now that's truly ridiculous. I'd rather have (and do) his '68 in an "8," as it brings to life his 22-9, 1.12.ERA season. There are certainly far better ways to spend $2,000 bucks!

Larry

[ls7plus]

Originally Posted by Steve D

Well, I have to say that I have had it!

I just got outbid on a Reggie Jackson PSA 4 1969 Topps; card ended at $190 (double the recent going rate). Then I got outbid on a Steve Carlton PSA 7 1965 Topps; card went for $868 (the last PSA 8 sold for $520 on June 20th).

Edited to add that just 2 days ago, a PSA 6 Reggie Jackson 1969 Topps went for $190.

This is absolute bull$hit!

People have lost all concept of reality, and for those who are saying the prices on high-grade cards won't affect the lower grades, I say BS! It is already affecting practically ALL grades of cards!

Steve

Wow! Wait until demand kicks up for my '69 Topps Super Printer's Proof Reggie rookie, with maybe a handful around (I've seen two in five years)! I bet it won't be 1000% over several months, though. You have to be a real collector who knows what is out there to even be aware of the proof card.

Happy collecting, and collect what makes you happy!

Larry

[Exhibitman]

Originally Posted by scotgreb

I knew that card looked familiar . . . thanks for the purchase Adam

You're welcome; heck of a nice card.

[BBB]

I've always thought Gibson was undervalued. So I'm glad it's going up.

Jim Palmer was a great pitcher, perhaps better than Gibson (except for Gibsons '68 season). but Palmet doesn't have the reputation of Gibson. It's almost impossible to build that this far after the fact . I'd put Steve Carlton and Tom Seaver ahead of Palmer in the line for similar reasons.

Sent from my iPhone using Tapatalk

[bobbyw8469]

Originally Posted by BBB

I've always thought Gibson was undervalued. So I'm glad it's going up.

Jim Palmer was a great pitcher, perhaps better than Gibson (except for Gibsons '68 season). but Palmet doesn't have the reputation of Gibson. It's almost impossible to build that this far after the fact . I'd put Steve Carlton and Tom Seaver ahead of Palmer in the line for similar reasons.

Sent from my iPhone using Tapatalk

One card explosion doesn't mean it's going up. I haven't confirmed the winning bidder even paid for the card.

[begsu1013]

.

[ullmandds]

The hobby is officially MAD!!! Pwcc's auctions ending tonight...an off centered psa 8 clemente rookie is currently going for almost 4 times that of a nm goudey ruth.

Commoditization...insanity...call it what u will. A good time to sit on the sidelines and wait things out in my opinion or buy all of these underpriced vintage pre wwII cards .

[drcy]

Originally Posted by ullmandds

The hobby is officially MAD!!! Pwcc's auctions ending tonight...an off centered psa 8 clemente rookie is currently going for almost 4 times that of a nm goudey ruth.

Commoditization...insanity...call it what u will. A good time to sit on the sidelines and wait things out in my opinion or buy all of these underpriced vintage pre wwII cards .

My saying is "That a lot of people do it, doesn't make it smart."

[ls7plus]

Originally Posted by ullmandds

The hobby is officially MAD!!! Pwcc's auctions ending tonight...an off centered psa 8 clemente rookie is currently going for almost 4 times that of a nm goudey ruth.

Commoditization...insanity...call it what u will. A good time to sit on the sidelines and wait things out in my opinion or buy all of these underpriced vintage pre wwII cards .

Right on, Pete!

Regards,

Larry

[bobbyw8469]

Originally Posted by begsu1013

nor will you.

you've got nothing to do w/ the sale, so why would he waste his time?

Then as far as Im concerned, the sale never took place. If someone says they paid $100 for a gallon of gas, am I gonna just blindly believe them?

[Dpeck100]

So if he says yes are you going to believe him?

[bobbyw8469]

That's the bad thing about these "sales"....it posts a sale in VCP but I doubt very seriously money changed hands on that card. VERY seriously.

Maybe that is the madness about the Gibson rookie. On the others (Koufax, Rose, and a few more) subsequent sales seemed to follow suit. On this particular card, it was the ONLY ONE that registered that high of a sale. Why??? To push the number up in VCP? Only two people sniped above $2,000. Every other bid was normal.

[71buc]

Originally Posted by Exhibitman

Question: who could be next?

Answer: who won the most games in the 1970s?

I'm a collector so a PSA 6 meets my needs. I would never purchase a PSA 8 even if I had the means to do so. Because of this preference the recent crazy prices seemed to have little bearing on my collecting efforts until now. I have always believed that the 55 Killebrew was an attractive undervalued card. I didn't purchase one until last month. I thought I should do so rather than run the risk of a mid grade version exceeding my budgetary constraints. I'm sure that there are many other mid grade collectors like me who are reacting/panicking in the same manner which has also served to inflate prices. I cringed when I paid $250 for my PSA 6 Killebrew last month. After looking at recent sales for a PSA 6 I don't know what to think. A PSA 6 is far from rare so if there is a crash/bubble obviously collectors like me will likely get stung.

http://www.ebay.com/sch/i.html?_from...p2045573.m1684

[Aquarian Sports Cards]

Originally Posted by 71buc

I'm a collector so a PSA 6 meets my needs. I would never purchase a PSA 8 even if I had the means to do so. Because of this preference the recent crazy prices seemed to have little bearing on my collecting efforts until now. I have always believed that the 55 Killebrew was an attractive undervalued card. I didn't purchase one until last month. I thought I should do so rather than run the risk of a mid grade version exceeding my budgetary constraints. I'm sure that there are many other mid grade collectors like me who are reacting/panicking in the same manner which has also served to inflate prices. I cringed when I paid $250 for my PSA 6 Killebrew last month. After looking at recent sales for a PSA 6 I don't know what to think. A PSA 6 is far from rare so if there is a crash/bubble obviously collectors like me will likely get stung.

http://www.ebay.com/sch/i.html?_from...p2045573.m1684

Relax, you can still get it on a buy it now from kit young for $260. I don't know what is inflating these auction results when you can BIN so much cheaper. Oh, wait, you can't shill a BIN...

[71buc]

Originally Posted by Aquarian Sports Cards

Relax, you can still get it on a buy it now from kit young for $260. I don't know what is inflating these auction results when you can BIN so much cheaper. Oh, wait, you can't shill a BIN...

Thanks that is good information. I only buy from eBay it seems. Can you share that link please? I looked at eBay BIN a moment ago and couldn't find it. http://www.ebay.com/sch/i.html?_odkw...C+-oc&_sacat=0

[Aquarian Sports Cards]

ugh, now I can't find it. Just Dean's over-inflated silliness at $445. However there are a number of PSA 5's between $149 and $199, so while I can't find the card I mentioned above, there are still signs of sanity in the market.

[Tennis13]

I am a relative novice to this world compared to you all. A few things with respect to economic theory that could be going on here. First, you have supply and demand curves, and relatively speaking, you have a fixed supply curve at best, or an inward shifting one at worse. Prices could go up due to contrived scarcity, or due to rising demand. It seems based on discussions, nobody is certain.

Second, you could have cartel pricing going on here. A few people/organizations are working together to control supply. In order to do that, one must first corner the market supply, and then trickle it out at an agreed upon speed. Or they could be divvying up players: you got Aaron, I got Mays etc. by company. OPEC has done this for close to 50 years to varying levels of short term and long term success. The DoJ is not going to go after collusion in the baseball card secondary market.

Third, you could have somebody buying 10 or 15 of a sort of specific card or player, then purposely bidding up the last one purchased to set the market so they can unload 1 or 2 at 10x value to an ill informed buyer to break even, and then unload 13 remaining in the OPEC manner. Would this require auction manipulation? Perhaps, but that's apparently not stopped many people before in this industry. In addition, if you owned a company that charged based on final pricing for your services, this could almost be a lost leader in your business.

Fourth, I see a ton of posts about "1000% year-over-year growth in price. That's a bubble." Well, not necessarily. It depends on if we started with an undervalued asset or an overvalued, mega-liquid, mature product. If you bought Sirius XM Satelitte stock at the trough of the 2009 financial crisis, you would have a similiar return over 3 years. Same wih gold from 2004 to 2011, but from 1980s to 2004 you would have been flat on gold notional terms. My point is that assets don't appreciate linearly, and when they move, they move. Sometimes they have a blowoff top (bubble) and sometimes they don't. But 1000% on a $0.25 asset is a heckuva lot different than 1000% on a $5 million asset. Elasticity of demand is much more inelastic on cheaper prices than higher prices. So I would be careful about getting wrapped up in percentage increase numbers, in my opinion. As crazy as it may sound, $1500 is not a lot of money to professionals in large cities where the cost of living may be 5x middle and southern America.

Finally, the industry is well known for lack of good institutionalization of risk and controls. Think about the worst firms you can find in finance, and that's sort of where this industry stands in my mind as a collective. Sad, but unfortunately true. So there could be some dodgy things going on. Again, you all know so much more than I do about that. When you have prices charged based on appraised value rather than a flat rate, it's in that comapny's best interest to have higher appraisal values. It's in long-term market players best interests to see their assets appreciate quicker.

To hear people bit h about how expensive things are, though, is a welcome change to the past 25 years in this hobby. You have all dealt in depreciating assets for so long, that any inventory you actually hold that's appreciating could be unloaded at these "absurd" prices and you get all the joys and experiences the past few decades free of charge or with a small profit. Not bad, I would say.

[Exhibitman]

The hobby definitely is a scummy business. More card auctioneers and dealers have gone to jail since 2008 than banksters.

As for the run up I've decided to post certain cards for sale at 'ridiculous' prices and test the waters. If they sell I will happily take the profits. If not I will happily keep them.

[Leon]

Originally Posted by Exhibitman

The hobby definitely is a scummy business. More card auctioneers and dealers have gone to jail since 2008 than banksters.

As for the run up I've decided to post certain cards for sale at 'ridiculous' prices and test the waters. If they sell I will happily take the profits. If not I will happily keep them.

It is a scummy business for some but they might have been scummy in other areas had they been there. We are in an unregulated billion dollar industry. Need anyone say more? There is no doubt in my mind there is some manipulation going. I am in the corner of thinking that says whomever is doing it is spinning their wheels at best and will get creamed financially at worst (or go to jail if they are doing something illegal). I am not talking about a collector buying an 8 or a 9 for their set. I am talking about trying to corner the market on cards which there are hundreds and thousands of, and that is crazy if you ask me (and some others).

[revlis]

An interesting parallel is currently happening with Magic the Gathering cards. Wizards of the Coast (maker of Magic the gathering) have a "reserve list" - these are cards they have said will never be printed again in subsequent releases.

As a result, people started to buy up all copies of certain cards on this list. They then posted about cornering the market thus creating a buying frenzy and driving prices up.

Some truly standup guys are trying to get in on the action too, might have heard of him - Martin Shkreli - see article below.

http://www.geek.com/games/real-life-...cards-1661003/

I am in a way reluctant to fan the flames of this whole conspiracy topic but there is some fairly compelling evidence at least with other collectibles. While baseball doesn't have a reserved list we do have 'pop' reports which could serve a similar purpose. I do however agree with Leon's above point that this is a futile effort to corner the market completely. I do also think this 'new blood' is good for the health of the hobby. I myself am part of that new blood.

[TanksAndSpartans]

Tennis13 touched on one of the things I was thinking, but articulated it better.

Say you quietly buy 5 PSA 8 cards over the course of a year (say Jim Brown rookies just as an example)

I'll use round numbers:

5*6K=30K

Then suddenly collude with someone to run an auction up to 17K

You now have 6 cards at a cost of 30K + 17K = 47K

The hope would be that 17K price acts a signal or whatever and the card gets hot. Even if the 6 are now sold over time, some auctioned off or however at 10K each (a bargain relative to the 17K price), you have:

6*10K=60K-47K=13K profit

[Tennis13]

Originally Posted by TanksAndSpartans

Tennis13 touched on one of the things I was thinking, but articulated it better.

Say you quietly buy 5 PSA 8 cards over the course of a year (say Jim Brown rookies just as an example)

I'll use round numbers:

5*6K=30K

Then suddenly collude with someone to run an auction up to 17K

You now have 6 cards at a cost of 30K + 17K = 47K

The hope would be that 17K price acts a signal or whatever and the card gets hot. Even if the 6 are now sold over time, some auctioned off or however at 10K each (a bargain relative to the 17K price), you have:

6*10K=60K-47K=13K profit

So let's be real methodical here. All possible winners in this situation:

1). You corner market and outbid a few people that JUST MISS over and over. You have identified the buyers. Now pull the cards off market for 18 months or 24 months. Whatever. Or better (illegaly) yet, keep bid rigging so that guy keeps just barely missing out. Then Finally after he has been outbid and hasn't seen his big card for 18 months, you relist, see him chase and overpay. To get your sort of economics outlined above. Because you have cornered the market, you can release at whatever speed you want and control the supply. Contrived scarcity.

2). Card graders are charging by value. If i own a $100 million dollar company and spend $500k to generate 20% or 25% higher grading revs per year due to increased market value, AND I get to personally hold an "asset" in a card, well that's a leveraged win-win situation. Nothing illegal here, but definitely higher risk for ruin by leveraging yourself to same industry.

3). I am an auction house. I take a percentage of gross sales. I have indicated sellers, and I am trying to get them off the fence. I point to specific cards/auctions/factors that allow me to auction your card off and max your value. This would be a very legal, big data approach that would be really awesome to try to pull off. Let's build a regression off every possible sale we have from last 15 years and try to predict the factors that maximize card values. And if we have to buy a few to put it to the test, to strum up interest, nothing wrong with that.


Those are the only 3 possibilities I see for a sort of "ulterior" motive to prices going higher. None of which are illegal, unless there is collusion on #1. But cornering the market is not illegal if you do it alone, and it's often ruinous long-term.

I don't think any of the above 3 scenarios are very likely, because 1&3 are a high risk of ruin. Scenario 2 is possible, but I don't think those guys are rich enough to actually do what you all think is happening. My hunch is there are a handful of rich tech/hedge fund dudes that are in an arms race with each other, and these prices are rounding errors to billionaires, and they are just buying everything they never could buy growing up.

Never underestimate bored billionaires. Ballmer paid $2 billion+ for the Clippers because he needed something to do. $100,000 for a baseball card: big deal.

[1952boyntoncollector]

Originally Posted by Tennis13

So let's be real methodical here. All possible winners in this situation:

1). You corner market and outbid a few people that JUST MISS over and over. You have identified the buyers. Now pull the cards off market for 18 months or 24 months. Whatever. Or better (illegaly) yet, keep bid rigging so that guy keeps just barely missing out. Then Finally after he has been outbid and hasn't seen his big card for 18 months, you relist, see him chase and overpay. To get your sort of economics outlined above. Because you have cornered the market, you can release at whatever speed you want and control the supply. Contrived scarcity.

2). Card graders are charging by value. If i own a $100 million dollar company and spend $500k to generate 20% or 25% higher grading revs per year due to increased market value, AND I get to personally hold an "asset" in a card, well that's a leveraged win-win situation. Nothing illegal here, but definitely higher risk for ruin by leveraging yourself to same industry.

3). I am an auction house. I take a percentage of gross sales. I have indicated sellers, and I am trying to get them off the fence. I point to specific cards/auctions/factors that allow me to auction your card off and max your value. This would be a very legal, big data approach that would be really awesome to try to pull off. Let's build a regression off every possible sale we have from last 15 years and try to predict the factors that maximize card values. And if we have to buy a few to put it to the test, to strum up interest, nothing wrong with that.


Those are the only 3 possibilities I see for a sort of "ulterior" motive to prices going higher. None of which are illegal, unless there is collusion on #1. But cornering the market is not illegal if you do it alone, and it's often ruinous long-term.

I don't think any of the above 3 scenarios are very likely, because 1&3 are a high risk of ruin. Scenario 2 is possible, but I don't think those guys are rich enough to actually do what you all think is happening. My hunch is there are a handful of rich tech/hedge fund dudes that are in an arms race with each other, and these prices are rounding errors to billionaires, and they are just buying everything they never could buy growing up.

Never underestimate bored billionaires. Ballmer paid $2 billion+ for the Clippers because he needed something to do. $100,000 for a baseball card: big deal.

I know i have paid 40 bucks for a card that i know others would say should sell for 20 bucks but i didnt care because its 40 bucks.....for some 8k to them is 40 bucks to us..

[Billy5858]

Originally Posted by 1952boyntoncollector

I know i have paid 40 bucks for a card that i know others would say should sell for 20 bucks but i didnt care because its 40 bucks.....for some 8k to them is 40 bucks to us..

+1 This makes the most sense to me.
Billionaires that are not trying to corner
the market and make money. But billionaires
who are just buying because they CAN so
they do. Trophy cards to show their billionaire
friends just for the heck of it.

[bnorth]

Market manipulation in baseball cards is super easy, I see it happen all the time, sometimes on purpose and sometimes by accident. Just go to a forum or a few forums hype the crap out of something. Get a few people to help and bingo a nice return on investment.

On this forum you don't have to look farther than MattyC to understand how it works. His constant posts about perfect centering had a affect on card prices. I don't know if he just liked centered cards or if he was flipping them to make $ but his posts did affect prices.

[packs]

Today I traded futures on a kid named Sammy Benign from Oxford, MS. He was born today but I commodified his future cards and turned them into 12 barrels of oil and 6 ounces of silver.

[TanksAndSpartans]

I know who owns the famous T206 Wagner, but I'm a little skeptical that some billionares have recently entered the market. Its just a casual observation, but sometimes the wealthiest people are also the thriftiest. I actually do have second hand knowledge of someone who was doing well financially and put together a significant collection, but it was memorabilia - one of a kind items in some cases, game used, etc. stuff you can display like a trophy - conversation pieces. In my opinion, the average huge sports fan walking into your house - you'd have to explain what the little 9 or 10 means on the piece of paper above the card. If you have a bat that was used to hit a game winning world series home run or something, not much explanation is needed.

And who wins the big eBay auctions? The ones I checked, the eBay user ids have feedback scores way higher then mine - it takes time to build that up.

[Dpeck100]

Originally Posted by TanksAndSpartans

I know who owns the famous T206 Wagner, but I'm a little skeptical that some billionares have recently entered the market. Its just a casual observation, but sometimes the wealthiest people are also the thriftiest. I actually do have second hand knowledge of someone who was doing well financially and put together a significant collection, but it was memorabilia - one of a kind items in some cases, game used, etc. stuff you can display like a trophy - conversation pieces. In my opinion, the average huge sports fan walking into your house - you'd have to explain what the little 9 or 10 means on the piece of paper above the card. If you have a bat that was used to hit a game winning world series home run or something, not much explanation is needed.

And who wins the big eBay auctions? The ones I checked, the eBay user ids have feedback scores way higher then mine - it takes time to build that up.

They might not know at first glance but the average person can figure it out pretty quick.

I have a lot of low pop cards from the genre I collect and they are displayed on the walls in 36 card display cases.

Generally the first reaction is wow your cards are really cool. Man those are in nice shape. Yeah that is the only 10 right there so far. Are you serious??? That is so awesome.

Now imagine saying that on very expensive cards. The owner loves the reaction I promise.

[ruth_rookie]

Originally Posted by WhenItWasAHobby

I also have a great distrust for anything associated with PSA. These ridiculously high prices will only bring more scammers out of the woodwork and will only elevate the frequency of card altering, card restoration, phony holders and flips, questionable bump-ups among many of the well-documented PSA-related scandals.

So in the final analysis, it's the label and the holder that's the commodity - not the card and that's not a good thing.

Damn, Dan. Did you have a crystal ball? Well done, sir.

[perezfan]

Wow.... very insightful indeed!

Here is another post from 3 years back that was pretty spot-on....

Originally Posted by doug.goodman

I'm happy for the people who make a killing when selling their plastic cases that also happen that contain opinions and cards (in that order of importance).

And, I get a big grin on my face when the buyer loses a bunch of money trying to get a return on their "investment", oh wait, that doesn't actually happen, because they have a better chance of cracking and resubmitting for an even better opinion, and then THEY become the ones making a killing.

Good for them. Everybody wins.

Happy collecting,
Doug Goodman

If you read the OP, it is so sad that this a-hole cares only about money. No love of the game or reverence for the cards themselves. Just dollar signs and profits made by any means possible. Thankfully, his insatiable greed has now put his status as a "free man" in jeopardy. But very sad that he was given the power to help ruin the hobby and subsequently cast doubt upon all of our collections.

Great job Jason, reviving this post!

[Peter_Spaeth]

With the emphasis on, by any means possible.

[frankbmd]

Originally Posted by perezfan

Wow.... very insightful indeed!

Here is another post from 3 years back that was pretty spot-on....



If you read the OP, it is so sad that this a-hole cares only about money. No love of the game or reverence for the cards themselves. Just dollar signs and profits made by any means possible. Thankfully, his insatiable greed has now put his status as a "free man" in jeopardy. But very sad that he was given the power to help ruin the hobby and subsequently cast doubt upon all of our collections.

Great job Jason, reviving this post!

You mean he hasn't always been working with law enforcement.

[Fuddjcal]

Originally Posted by Brent Huigens

I tend to detach myself from reading and posting as I believe the message boards offer the hobby a forum for discussing issues openly without the influence of businesses like ours. I’m writing this post to share my thoughts on how the hobby is changing due to an influx of buyers using sportscards as an investment, and trading them like commodities. This is in part a follow up to a post on the Net54 Baseball message board here about the ethics of “market pushing”. The purpose of this post is to share my opinion on the root causes of this phenomenon; and why this may be uncomfortable, is perhaps a sign of a maturing industry.

Those of us who have been in the hobby for longer than 10 years are surely seeing the recent market trends and simply shaking our heads. Clearly the world has lost its mind and we are undoubtedly headed towards the biggest bubble bursting event in the history of collectibles. Maybe… or maybe not. Here’s at least one argument for why what’s happening is both justified and has even been predicted.

In general, the “brand” of sportscard collecting is maturing. We’ve seen this trend trickle forward over the last five years especially for the top 1% of cards. Clemente RC PSA 8s traded readily in the $8000 range five years ago, then they went to $15,000 three years ago…. then $30,000 last year… and now $100,000 seems to be the new benchmark. How is this possible? A 1000% return on investment in five years?

For the overwhelming majority of the industry, the “hobby” element of card collecting remains strong and vibrant and seems destined to stay that way. However, the top 1% (especially top 0.1%) of vintage cards are re-branding themselves away from pure collectibles to instead take firm root in the world of commodities. Just like pork bellies, bonds, and orange juice concentrate.

Within this new “commodity” element, the only two variables that matter are supply and demand; that’s it. And there’s the catch… supply. Sportscards are some of the rarest commodities in the world where even the highest population high-profile cards (i.e. Jordan RC PSA 10s, Clemente RC PSA 8s, etc) are rarely seen on the market at any one time in quantities higher than 2 or 3. Sure the populations of these cards may be 100 or more, but who cares? Any highly-prized commodity with population in the hundreds or less is absurdly low; perhaps to the point of creating a sheer frenzy when these investments surface on the open market. And that’s what we are seeing.

It is important to note that when it comes to high-value collectibles, sportscards are not a trailblazer. In particular, coins and fine art are far beyond the current market of sportscards, even in light of the recent trends. Compared to these other industries, sportscards have a long (long) way to grow before competing for market cap alongside these other collectible based commoditized markets.

Let’s also take a moment to see the potential and speak positively for a moment; sportscards are a heck of a lot more fun to most people and certainly appeal to more investors than most other portfolio diversifications. What’s more fun to your average ‘guy’ investor… a fancy painting, some rare 5-cent nickel, or a Roberto Clemente Rookie card? Assuming the three options had equal investment potential, which would you most enjoy owning? I know what I’d say and I know a few other folks who feel similarly

One point of pessimism that I feel warrants discussion is the claim that “this must be a bubble because there’s only a handful of people responsible for most of the recent price increase”. In other words, this trend must be fragile indeed if only a few people are responsible for the change and what happens if one of them runs out of money or leaves the hobby? What if the market is flooded by the recent sales history and these few individuals can’t keep up? These are all fair and reasonable fears to harbor and I don’t have all the answers; to a large degree I am riding the waves with everyone else, trying desperately to keep some view of the horizon (and it’s been tough of late).

Let’s get a couple things straight:

1) Yes, I do believe this hobby is getting pushed hard by a limited number of collector/investors. Not sure exactly how many heavy investors there are, but I’d say the people most responsible number more than 10 and probably less than 30.

2) Should even a few of these 10-30 people vacate their position and nobody replaces them then this could possible turn into a bubble bursting event for certain cards. Supply and demand rules supreme and if supply goes up too high or demand goes down too low, the market will lower. Just a fact.

The above statements are both true; no reason to hide from it or run for the hills. In light of these truths, I have never been more confident of the bright future we face in this hobby than I do today. This is not a bubble, or at least I am confident from my position that this is not a bubble. Sure, some individual cards may get pushed higher than is sustainable and need to eventually correct, but I can’t help but view the above comments from a glass-half-full perspective… the fact that only 10-30 people can change a market is incredible! What happens when the 10-30 investors becomes 20-40? What happens when it gets to be 100-200?

Considering the recent unprecedented ROI with sportscards and also considering the love of sports and the inherent wealth investors are ready and willing to invest towards collectibles, it seems awkward indeed to argue that demand for the top 1% is going anywhere but up. As the largest auction house in the country for sportscards, we are already seeing a new generation of investors entering the hobby and this trend is on an upward track. Sure, supply may run in spurts as some more nervous collectors may choose to fire-sale in light of recent trends, but these mini-liquidations will soon dry up and the sturdier breed will be happy to continue betting on the market. I suppose it’s possible that greater supply could also come from new cards being graded, but this too is unlikely to add any meaningful % to the current population. I for one will be shocked if the population of 1952 Mantle PSA 8s rise by more than 10% in the next five years (same for PSA 8 Clemente rookies). Yep, I for one feel the “well is dry” and what little water we have is all we’ll ever have. Just my two cents but in light of the harsh supply/demand principals considered, I feel the 1952 Topps Mantle PSA 8 may be the most undervalued card in the entire hobby. As a pure commodity it might someday be considered “priceless” to some investors.

Brent Huigens
PWCC Auctions, LLC
brent@pwccauctions.com

Please shut your pie hole Brent Mastro. You are a DICK. I hope you end up in jail you crook.

[WhenItWasAHobby]

Originally Posted by ruth_rookie

Damn, Dan. Did you have a crystal ball? Well done, sir.

Thanks Jason. It was an easy call in light of PSA's dubious history.

[perezfan]

Originally Posted by WhenItWasAHobby

Thanks Jason. It was an easy call in light of PSA's dubious history.

Well despite all of the overwhelming evidence, it still isn't an easy call for those who are blinded or deeply invested.

And those two quotes at the bottom of your post are also pretty darned relevant right now. Especially the Mark Twain!

[BigBeerGut]

Brent it seems as if you are a bit off topic?

Please talk more about what we all really want to hear about from you

What about you just say sorry ? You owe the community an apology and 100's of thousands have been spent on cards you knew were bogus. PSA was not involved they are not a part of it!

We expect the Moshers of the world to do their thing but YOU are the chosen one we all trusted

You are running the casino with loaded dice!? why why why

Tell us you didnt know

[Johnny630]

Originally Posted by BigBeerGut

Brent it seems as if you are a bit off topic?

Please talk more about what we all really want to hear about from you

What about you just say sorry ? You owe the community an apology and 100's of thousands have been spent on cards you knew were bogus. PSA was not involved they are not a part of it!

We expect the Moshers of the world to do their thing but YOU are the chosen one we all trusted

You are running the casino with loaded dice!? why why why

Tell us you didnt know

So sad reminds me of a awful war criminals statement on propaganda

If you tell a lie big enough and keep repeating it, people will eventually come to believe it.
Joseph Goebbels

I’m saddened by the fact that so many collectors and investors bought into this :-(

[Peter_Spaeth]

.

[Johnny630]

Yup they swallow the hook to his method of Marketing just like the Registry sheeple to PSA whom are so entrenched on their brand there is no coming back for them they have to continue to beat the PSA drum....For as much as I dislike many things about PSA their Marketing is Brilliant

[darwinbulldog]

.

[the 'stache]

Originally Posted by Peter_Spaeth

.

One of Andy Warhol's lesser works.

He said, "in the future, everybody will be famous for fifteen minutes." What an incredibly prescient statement that was.

[Exhibitman]

Brent is a very bad man. "very very bad man!"

[Vintageclout]

Originally Posted by Bradyhill

Maybe I am wrong, however all of this makes me chuckle. Everybody is trying to solve some master puzzle if this is a bubble or not. Who cares? To me this is simple...

I say people should buy cards and have fun with what you are doing and if you are not comfortable with the price then don't buy it.

Carry on...

+1000.....thank you Brady!

Joe T.

[perezfan]

Originally Posted by Exhibitman

Brent is a very bad man. "very very bad man!"

Hahahah...

https://www.youtube.com/watch?v=jocI_R8lMpM