[Exhibitman]

Fascinating articles and podcasts breaking out right now (Fortune, NYT, etc.) about the everything bubble bursting. In a nutshell, in that analysis, for most of the past 14 years, monetary policy in the U.S. and internationally has been consistently setting interest rates low and letting money flow to commercial banks by buying up assets and stocks. That spurred economic growth in the face of several economic crises but also led to multiple economic bubbles—from housing to crypto to VC-backed subsidies for things like cheap Uber prices—existing at once. Now, all those bubbles are popping as banks tighten their policies and stop the free flow of cash. At the same time, the cost of goods that are at the core of upper middle class life--medical care, elder care, education and housing--have gone up at rates far in excess of the traditional rate of inflation and far in excess of wage and income growth for the vast majority. There has also been a camouflaging of inflation in two respects: (1) outsourcing the actual costs of 'cheap' consumer goods to other countries or the commons (environment), and (2) asset value growth. If you buy a t-shirt made in China for $1.99 but it is made from cotton harvested by slave-like labor and grown in a way that wrecks the environment in China, you don't experience those costs but they are real. In our bailiwick, if the cost of a 1952 Mays goes from $600 to $4,000 in a year or two, that cripples the ability of an average collector to buy it...aka inflation. But we see the inflation of investment assets as growth...if we re on the ownership side of the equation.

One other issue that has been researched and is being raised with regard to crypto and stock like AMC (and modern cards are similar) is that the market is being driven by younger, less sophisticated, less wealthy people. They are making big bets on these assets with little experience or knowledge because they want "in" on the game. That is a recipe for a crippling downturn when these people start losing. Someone deriving a substantial part of their wealth or income busting and flipping (or selling ancillary services and goods to those people), they are gonna bleed out fast when things lock up or drop and they have to sell into it.

What it says to me is that the frothy card market is a dead man walking, especially for modern, postwar and mainstream stuff. I'm waiting on further mainstream big ticket stuff until 12-18 months from now, which is when I think it will bottom out.

Tomorrow's REA close should be interesting as a bit of a test of where we are with the middle class of the hobby. Only a few cards in there are major auction-type items. The rest are exactly the sort of items that should start to decline when the bubble starts to deflate. The auction in August should tell us even more.