Quote:
Originally Posted by joshuanip
Very few can have a Van Gogh, so others look for alternatives like Banksy or Pollock. So you can be in a situation where you have a paradigm shift in how we view card prices, thanks to TINA asset price reflation. When Ruth’s get priced out, people will turn to Gehrig... or Mays/Aaron for Mantle. And trickle down.
One thing about price momentum... can go on for a very long time, especially if the fed makes it so there are no longer any economic cycles to create forced sales and temper pricing. Add in the fact that you see inflation expectations finally inflecting, and you know that nominal rates are capped (fed + you can’t raise rates at these debt levels else you bankrupt us), reflecting compression into negative real rates, and you get an explosion in the price of non yielding alternative stores of value, like art, cards, gold and Bitcoin.
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Josh, great post.
Something else to consider here is that there is more cash on the "sidelines" now than at any other time.
Depending upon what source is used, there is approximately 50 cents on the sideline for every dollar in the market. Ok, that 50 cents includes many things that may not be so liquid but the point is that people are looking to buy something that they feel will appreciate (over time) more than the dollar will.
Just guessing, but the rate of rise/escalation for cards might depend on where in this cycle things are. Has the search for "investments" just started? If so, then who knows what the limit will be. If people have already devoted a good portion of sideline money to other investments then wouldn't that be a precursor to a stagnant investment opportunity? If so, would that be enough to spook "investors" out of card board?
Fun game trying to predict the economy.
Bottom line is that for most collectors, the cardboard is getting too far out of reach. Heck, it might even be an interesting consideration do dump all of the higher priced "cardboard commodities" (assuming you're in them cheap) and look at a different avenue to "invest".
For me, I don't buy for investment. I buy because I like looking a pictures of mostly dead guys on old cardboard. If things get even crazier, I might think of liquidating and hoping to purchase it all back cheaper than what I sold it for, but that's also a crap shoot.