Some Reflefctions on an August Afternoon

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Posted By: John Spencer

After going 0 for 5 yet again in the recent Mastro auction, making it now 5 years since I have won anything, set me thinking about current developments in the hobby and while I am hardly a "Karmac", where things might be heading, particularly in our little world of pre WWII baseball cards. What concerns me as both a collector and hobbiest, is whether we are heading into a bubble, like internet stocks in 2000 and Dutch tulips in the 17th century. The recent explosive price increase in E-cards has been nothing short of remarkable and there is no doubt in my mind that M cards and D cards will follow shortly. It seems to me that there are any number of new affluent players who have entered out little world after having done some research about supply and demand curves, the heroic images of the older Hoférs and the continuing love, despite rapacious owners and players, of the game itself. Is all of this good for thre hobby? I don´t know, but I do know it has changed the structure of the marketplace dramatically. I have been a collector and much more recently a dealer for, gulp, more than 40 years and what seemed like a pleasant pastime has morphed into a multi-billion dollar business. The growth of the dealer base into serious businesses and, of course, the emergence of grading companies has changed the hobby forever in both positive and negative ways. Whether you like this development or not, both are here to stay. While I grow concerned about the dominating influence of the Mastro Empire, I must admit to being impressed how he has managed to gather some of the cream of the hobby, eg. Kevin Struss, Doug Allen, Derek Grady and most, recently, Peter Calderon, all of whom I consider to be personal friends. (Now, Bill, whenare you going to offer me a job?) There seems to room for smaller houses, such as SportsCards Plus, Lew Lipset, Barry Sloate, Seth Nageman and a few others. I still believe that the villians in the hobby will eventually disappear, or have disaapearred, and integrity will and must remain a cornerstone. I suspect my own compay, Full Count, will muddle along and probably continue to use Ebay as its principal distribution arm. In fact, I plan on pumping in some fresh material into the company in the coming months from my collection for a much need cash injection. Please excuse a bit of a babble, but boredom on a summer´s afternoon made me do it.

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Posted By: Paul

I've always felt that the prices paid for Graded 8s, 9s, and 10s is a tulip-like bubble. I never previously felt that the prices paid for lesser graded cards are part of a bubble. These are cards that people genuinely like and I don't see the subjective, emotional appeal of these cards dying down anytime soon.

But the prices now truly are crazy. $10K for a D304 Young graded Ex-Mt. $1200 for an E98 Mack graded a 3. I'm not sure what's going on here. It may just be a few people with big bucks driving up prices. It may be something else altogether. But I'm no longer confident that it is something that will last.

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Posted By: leon

We've scratched our "collecting" heads on this subject many times recently. I'm relatively new ( around 9 years ) to the hobby but it's waaaaay different than it was back in '96-'97. BTW, for folks that don't know, John Spencer and Mike Williams hosted the very first Vintage Baseball Card Forum, which was the predecessor to this one. In the old days there was no deleting or editing. It was really the wild, wild west back then. We would just pray that no weirdo's (more than the norm I mean) went berserk. I look forward to some of your collection coming out. I know you outbid/sniped me on lots of good stuff back in the day. I'll never forget the D359 Plank you beat me on.....thanks for posting.....

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Posted By: identify7

Yeah.

New sport card sales peaked at over a billion about a dozen years ago. But there were just too many types and companies serving that market. The falloff in new card sales has resulted in current sales being about a quarter of the peak. A percentage of those collectors have transitioned into pre-war, and other collectors have joined them (and us).

The resultant shrinking of the new card market should help it, while the influx of collectors is strengthening our pre-war cards. I believe that we are not facing a bubble which will burst, however, I am facing a budget which currently purchases less cards than it formerly had. I forecast prices continuing to rise due to the health of this hobby.

As far as the picture for dealers, I will defer comment to those better versed in those considerations.

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Posted By: Tom Boblitt

interesting topic. I think the Mastronet's and SCP/Sotheby's and other auctions have moved groups that were previously separate into converging with the addition of the 'Americana' auctions. The coin, comic, presidential, art, etc, etc, etc guys used to stay in their silo's just like the card guys (and Julie and Joan now....) stayed in theirs.

I bet if you delved into the deep dark secrets of some of the databases out there that these behemoth Auction house have is that you'd see a LOT of cross-pollenation now between the different types of collectors/investors. While these folks (and most of US) collect because we love the subject matter, many of them (and some of US) collect as investments too. Our space (pre-war cards) is MUCH more crowded that it was 1-2-5-10 years ago. Just a fakkalife.......

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Posted By: tbob

It seems to me that in the past couple of years I have witnessed more cards going in to collections and staying there and fewer cards being "flipped," hence the shrinking of the supply of vintage cards. I also think that ebay is a double edged sword, on the one hand I am happy it exists because living in an area with no card shows, it means access to great cards I would never otherwise see, on the other hand, ebay has brought a growing number of collectors/investors in to competition for these cards. You take the good with the bad, though, and I am glad for ebay. I agree with the above posters who feel that the PSA 7, 8 and 9 market is a bubble ready to break. On the other hand, VG cards will continue to slug along and keep their value. If they don't, who cares? I'll still have tons of cards I love, expensive or not...

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Posted By: BlackSoxFan

Boy do i have a lot to say about this...but i will keep my comments here very very short. I have been pre-war since i started getting serious about cards (ie 12 years or so)..but only recently have i become an educated buyer (or at least attempted to be lol) just remember ... this and many other collectible markets are all relatively new. There is a long way to go and a lot of changed are a comming..... young tech nerds like myself combined with the experienced and knowledgeable people (like yourselves) are gonna be able to do some neat things. Hopefully for the better, although there will always be some negative consequences. The bubble isn't going to burts..but it will definitely change a lot!!! Think of it more like the bubble is still being formed ...



Regards,
Black Sox Fan

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Posted By: Tom Boblitt

is that it's tougher for dealers to purchase cards anymore. They have to pay more and more because people are smarter now and sell stuff on ebay. At the very least, they have a revolving price guide to check value and make more informed selling decisions.

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Posted By: Greg Ecklund

I agree with Bob that supplies are much tighter than they were even a few years ago...more cards do seem to be going into collections and staying.

It is also not entirely accurate to compare the vintage card market to internet stocks or tulips as there were not finite supplies of either stock or tulips - as the demand for internet stocks grew, you saw new startups created and new IPO's in order to satisfy investor demand. Tulips - the same thing - if you wanted more you simply had to grow them. Cards simply can't function that way - American Caramel can't crank up the presses anymore to print cards that would meet the increasing demand. The best comparisons to cards would probably be old toys or vintage art - in both of those cases, as with cards, the supply is pretty much set outside of the occasional "finds" that still happen but with less frequency.

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Posted By: BlackSoxFan

Greg - I don't think anyone on here was comparing vintage cards to the stock market (at least not for the purpose of this discussion), but there are some similarities. While vintage cards are not going to be grown on trees...there are more cards to become available to the market b/c they belong to people who don't involve themselves (either by choice or because they just don't know it exists) with what we refer to as the market. Also, vintage cards are being "discovered" from time to time! Finally, the vintage card market is not isolated from the modern card market. The two do have some affect on each other ... how much of course is a whole nother topic.

Regards,
Black Sox Fan

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I'm Smart Enough To Know, There Are A Lot Of People Who Know More Than I Know

BlackSoxFan.com
email me

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Posted By: scott

just getting back into the hobby a couple months ago i feel out of place giving my opinion but here it goes..
as far as a bubble waiting to burst i think psa 7,8 and 9 big money commons ..not commons from truly hard to get sets but cards from the more popular t sets etc.i don't expect the prices to drop,just plateau as there will always be a group of set collectors with the $$ to build the highest quality possible .

i feel low to midgrade cards hof's will always have a market and hold their value.as long as you love what your buying while staying in your budget and not just because everybody else is you can't go wrong.

nice thread!
scott

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Posted By: Darren J. Duet

IMHO vintage cardboard is in its infancy.

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Posted By: Julie

Vintage cards are finite (at least, we fervrently hope so!), and if enough people get into the hobby of collecting them, there will be fewer and fewer to go around. PSA 9, in Mastro, on eBay, or anywhere. Unless, of course, and equal number of people are getting OUT of the hobby.

I remember Barry Sloate's saying, about OJs a year ago, that what goes up must come down...except this time...

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Posted By: warshawlaw

waiting for my case to be called and I looked down at the logo patch on the handsome case I purchased at the National to lug home all the cards I inadvertently [don't laugh, the wife bought it ] purchased and noticed something: the logo says the show was the 26th National. The National is 26 years old. This isn't a fad or a passing fancy, nor is it technologically-based and vulnerable to new developments (given the refractor detractors out there, probably the opposite), this is a real, maturing investment field. If you'd been in the field 30 years ago and had plunked all your ducats into prewar cards you'd be sitting on a hell of a nest-egg today.

That said, I think some people are perceiving one of the indicators of a bubble-type hard asset market, namely, people sitting on inventory who might not otherwise do so. One of the driving forces in real estate prices in many areas of SoCal over the last few years was lack of inventory; with nothing to buy, home buyers wanting to use low interest rates to purchase homes fought over the properties that were there. Now that lots of homes are coming on the market in previously short-supplied areas [on one well-heeled street near my house my wife and I counted seven new listings], selling time is lengthening and prices are flattening in many areas (there was an article on the subject in the L.A. Times a few weeks ago; I'm not bright enough to have figured out all of this myself). I think the same is true of cards. I haven't seen explosive growth in postwar HOFer values; the core of my postwar collection is worth about what it was worth five years ago. The supply and demand have reached an equilibrium of sorts in that field. The more "obscure" prewar cards (D-E-M-W-?) are not there yet, IMHO because the price increase hasn't pulled the hidden inventory into the market so far. I know I have acquired caramel cards that I would not otherwise have purchased and I am holding them as the prices skyrocket. I've seen prices up 20% on stuff I bought last month. I guess the trick is to get out at the right time. I don't think that time is now.

Quite a change from being a dork in a church basement trading cards with other men who should know better than to waste their time...

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Posted By: Greg Ecklund

Ted,
I was making reference to the initial post by John in which he mentioned the internet bubble/tulipmania - I probably should have made it more clear in my post.

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Posted By: Patrick McHugh

Pre-war cards are just like real estate. The cards graded high are like waterfront property there is only so many. The lesser graded cards are normal property, meaning up's and downs. As for post war cards graded 8, 9 10 the potential for more to come on the market is much and i do mean much greater than pre-war.

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Posted By: Julie

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Posted By: Darren J Duet

The internet has opened the door on much of what has been hoarded(either purposely or lack of market). Unlike the California real estate market to which Adam refers, old cardboard is just finding its market in the mainstream. What's the true price of a 1914 Cracker Jack Ty Cobb in excellent condition? Well in 1981, you could get one for about $200(or less). Of course, you had a very limited market then. While you had a gem of a card, how many people knew of its availability? As a dealer, you accepted market value usually based on a price guide which gave a range from previous sales(which were statiscally insignificant and skewed by lack of buyer awareness of card availability).

Now we know. We know what's out there. We know where to look. We browse, we search, we bid. The internet has decreased the work load of the collector, while increasing the marketing of the dealer, and the identity of our hobby. The result is a more accurate realization of monetary value.

Future price guides must take this into consideration. Is the true value of a card based on how it sells at conventions or hobby shops? or is the true value of a card based on the collective view of thousands, coast to coast with more than just browsing on their minds.

The supply and demand theory makes the assumption that the product is potentially available and known to all. I know for me, much of the pre-war cardboard was inaccessible until the internet came into play.

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Posted By: Richard Masson

What happened there is there was a tremendous acceleration in values in the 1990s as several new well-heeled buyers entered the market, chasing a limited supply of nice key comic books. There are fewer than 100 (sometimes far fewer) copies of the key books (Action #1, Detective #27,,,,) and higher prices needed to be paid to unlock supply from collections. Once these books had changed hands, and in the absence of any new big buyers, prices are at a plateau. They don't crash, because the new buyers don't need to sell (think:Copeland), but they don't rise dramatically anymore, either. Someday, new buyers will enter the market and we'll rachet up to a new plateau.

The supply of nice E cards and 19th century material is also very limited. Maybe not as rare as a key comic book, but there are a lot more buyers as well. As long as the owners of good material don't need to sell, prices will be fine.

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Posted By: Brian

The market is becoming for efficient. Many people on these boards that discuss "how high is high" are the same folks outbidding me on eBay. Nothing goes for a discount with all the price enforcing bids. Similarly, nothing underpriced stays in dealer inventory as specific collector focus can judge actual values much better than a dealer -- a collector might know his/her 3 or 4 sets for example, while a dealer needs to know many dozens of sets. Access to information has turned the tables.

I recently agreed to buy 5 cards from a dealer. The price was right in line with the 3-month, 1-year, and 3-year trends from eBay & private transactions. But before the deal was closed; the dealer backed out due to an aberration sale on eBay. One data point changed value perception for the other 5 cards. I am not a buyer (and I doubt others will be) at the "new eBay" price. Could I be wrong? Sure, if the market jumped 200% or more with that single transaction. Has such a dramatic increase stuck -- yes, but not yet with this set.

Very interesting dynamics at work in the hobby right now. Those with a long-term approach will be rewarded me thinks...

The biggest disappointment for me is the lack of trading/helping set builders. Whenever I post buy/trade threads, I don't get responses but do see sell threads or ebay auctions for the requested cards. On individual communications with board members, I only receive buy statements. Very rarely do my questions regarding trades or my wantlist get responses. Also, those that have finished a set are still bidders on cards (I assume either upgrading or price enforcing.

I think everyone is a dealer now. At least everyone is a dealer that buys/invests/collects/accumulates the sets I am working on.

Just my random thoughts

Brian

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Posted By: DJ

People need real estate to well...live. Real Estate is nuts.

I think there will be a slow down in the card market in the future. If this continues, that 1933 Goudey Malone will sell for $30K in a few years? Not sure there will be a total burst of the bubble as I find it hard to believe that I will suddenly pick up a EX-MT Monte Ward sliding for $150 one day on eBay. Bubble burst is my Iridium stock, 5000 shares at thirteen cents a share.

There has always been a healthy increase in card values, year in and year out. Something worth $300 one year was now worth $425 the next. Then maybe $550. That $550 card is now worth $12K to someone,somewhere where only a few examples in the world grade so high. Insane.

What we are seeing now...I can't really explain. It reminds me oh-so-much of tech stocks where we are blown away every day when a start-up IPO shoots to $130 before the opening bell. The card market is not like the stock market. It's not like tulips. It's not like real estate. It's not like art. It's not like really anything.

Either way, you have dividing opinions on what will become of the business price-wise. I think the high grade common is the Cisco stock and the solid stance on purchasing Hall Of Famers and tougher cards at "reasonable" prices is the Johnson and Johnson.

And you never know, the new collectors (millionaires) may only find this to be a phase and may move on to cow creamers shortly and we'll go back to being Nantucket in the winter.

Doesn't anyone remember the Pez phase? People were paying like $5K for some?

For me, I feel like Mr. Spencer. I haven't made a significant purchase since May and if there was a minor leagues for purchasing cards from large auction houses, I'd be the club house boy. I'd love to part with a few of my cards but it's like parting with my family.

DJ

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Posted By: Dan Koteles

are some of these finally getting there just due?

There are some cards that have gone for more then most of us long time collectors would expect, but many are getting to the prices for what they really are. This is good for some and maybe not for others .

This too is why there are lesser graded cards for those not as fortunate. You should know what you can afford and always have fun.

I get a joy on some of the youths in the hobby....like Zach for instance, he will collect a wide variety of pre war....like many of us when we were his age, come here and show all his finds and comment like an old pro. His comments are never boring and he will be a future leader in our hobby.

PRE WAR IS ALIVE !!!!!!

Edited for spelling like Leon !

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Posted By: pete ullman

being a 28+ year collecor, 10 or so strictly vintage, I think cards are finally getting their due! Nostalgia is BIG and there are lots of baby boomers with lots of disposable income getting nostalgic! I've seen t cards get expensive back when no one cared about caramels and have passed on, like all of you have, incredible cards over the years because the prices were just too high. Well, they're only going one way and that's up. I do feel the ridiculous prices on psa 7's 8's 9's may prove as good an investment in the near future as a chicago loft! I'll continue to cherish my cards...i do love them. Like I love my cat and my girlfriend...sick huh? And I will continue to collect, becoming less sensitive to condition than ever, because that's all I can afford!!!!!

pete in mn

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Posted By: Richard Masson

Thinking about something Darren said, since we now have multiple data points for transactions in vintage cards on ebay, wouldn't a compilation of recent trades be much more valuable than a price guide? Every time I use the search function to find prices realized on ebay, the data only goes back a month or two. Is there any way to search completed listings farther back, say the past two years?

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Posted By: Anonymous

kind of a 'Racing Form' for cards, eh?

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Posted By: Richard Masson

Don't you ever sleep?
PS-Song of the Saints Wednesday at the Spa

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Posted By: BlackSoxFan

heheehee.... i have access to eBay API, we're trying to work out a deal for a research tool..don't know if it will happen....but we're talking. As for B's point about trades...no kidding...i've posted trades about cards people have and i've only gotten one response..i'm just now getting to the point where i'm getting ready to trade out some of my cards that i can afford to get rid of...

Regards,
Black Sox Fan

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BlackSoxFan.com
email me

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Posted By: tbob

Runforest once posted a link to a compilation of all the tobacco and caramel cards sold on ebay with final prices and ebay numbers over the past couple of years. maybe he could do it again.

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Posted By: honus3415

Grading has been the sword that has lead the vintage card market to never before realized prices. And as surely as it has fueled this skyward trend, it will be responsible for it's demise.

Many times hundreds and often thousands of dollars rest upon the "opinion" of a grader. How often do we bicker amongst ourselves about a grade??

I foresee the day when every aspect of a cards condition will be technically analyzed by a computer. Human opinions will be a thing of the past. Every card will have an unbiased technical rating based on it's flaws (wheather visible to the human eye or not).

What will this mean?

It means our respected big three (SGC, PSA and GAI) will become the "PRO" graded cards of tomorrow. When the truth of today's grading accuracy is brought to light, the market will self adjust downward. Collectors\investors will flood the market with high graded\priced cards rather than risk having them found technically unworthy of the quality defined by their (SGC, PSA and GAI) holder. The "documented" inaccuracies will slowly destroy any confidence we ever had in present day's human eye opinions.

What will result?

The investor, which is fueling today's price trends, will look elsewhere for their investments. Afterall, these are pieces of cardboard and not a universally accepted commodity with any true value.

And the true collector will sit back and enjoy his cards just as much as he did when they were worth twice as much.

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Posted By: identify7

Honus: I forsee the same eventuality which you do, specifically computer grading of sports cards. However, my forcast is a strengthening in the credibility of grading once this is accomplished; resulting in baseball cards being more attractive to investors, since they then can trade as a commodity.

As far cards not having any true (intrinsic) value: what is the price of diamonds, gold, and some other commodities based on? Certainly not their rarity nor their utilitarian characteristics. They trade based on a buyers perception only.

While it is true that 100% computer grading will invalidate all that has preceeded it, I do not think that it will have a negative impact on card trading. PSA, SGC & GAI graded cards will represent the same risk currently viewed by many as applicable to today's raw cards. Over time, most cards will be computer graded (probably by PSA, SGC, GAI and others). Then cards can be listed with options, futures and other purchase oriented gambling choices.

But to some of us, if a difference in grade requires a computer to see it - is there really a difference? Heck, some of us currently think that if a collector feels that he has to look at his card under magnification to be happy with it, he has already lost some of the fun of collecting.

The above is my opinion only.

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Posted By: Josh K.

Honus' scenerio sounds like a script for a new terminator movie - Terminator IV - Rise of the Grading Machines.

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Posted By: warshawlaw

too much opportunity for shenanigans and people want human judgment when it comes to assessing the value of collectibles. Now, computer analysis might be useful to help live graders stay truer to form on certain things, like centering, which could be laser-measured so that a 60:40 limit is enforceable.

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Posted By: jay behrens

And who is to say that computer grading is going to be any better. The program still has to be written and each company will want to have a propriatery version, which means that each company will have different grading criteria.

I'm in that camp where if you need a magnifying glass to flind flaws, then you are missing out on the fun of hobby. The other question that raises is, why should a micro flaw that cannot be seen by the naked eye be judged as harshly as an obvious flaw.

Jay

My place is full of valuable, worthless junk.

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Posted By: Scott Forrest

I can just hear Arnold saying "You're slabbed!"

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Posted By: honus3415

Well dusk has given way to darkness and the crickets are chirping.

Thank goodness those darn cicadas have gone to sleep or moved on your way.

All I was saying above is that I would think the people playing PSAGAISGC Holdem' for $5000 or more a pop would demand making sure they weren't playing with marked cards when it comes to grades.

Look at this board, it it filled with questionable scans of graded cards from all the leaders....and those are just scans.....can you imagine how many more you would question if you were looking at magnified slabs in real life?

Would a computerized system do better grading?.......No...grades are the problem to begin with because they represent no hard facts!!!

What a computerized "fact chart" would allow, is each person their own opinion based on facts.... such as the "card measurements", which seems to be one of the biggest issues and rightly so.

What is your acceptable size variation limits??? 1/128".... 1/64".... 1/32"... 0...??? Now are you sure your grader of choice agrees??? I'm just not confident from some of the examples I've seen from each of these companies that I would want to risk thousands of dollars without a second opinion based pure facts.....and this would be one of the easiest facts for a computer system to determine.

Well I'll close and choose to drop this issue at this point. I'll leave this problem to this hobby's investors, as I'm a collector that is just happy to be able to afford a genuine unaltered card even if it is slabbed a "1" and looks small (they are so hard to measure in these holders).

It's late and Hal's asleep with visions of cases dancing through his head....and this is about the time Leon would answer my emails and I wonder what he was still doing up.

Hoping the winds in tomorrow's sunlight brings everyone a new cardboard smile they haven't seen before.

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Posted By: John

Funny you should say that Josh…I’ve been working on a film for sometime now. Looking to cast quite a few people let me know if you think you can play any particular roll.



My next project is the “Typeinator” staring Leon “Type Card” Luckey. His agent has yet to commit him to the project as of today.

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Posted By: Hal Lewis

You just KNOW the day is going to be a GOOD one when you wake up to something as FUNNY as this!!!!!!!!!!!!!

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Posted By: Wesley

LMAO

That is great wonkaticket!

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Posted By: Josh K.

LMAO as well. That is hysterical.

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Posted By: John

You’re idea Josh, see what happens when your bored waiting for phone calls from overseas.

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Posted By: dan mckee

Adam W. I need to sue John for causing me to bust my hernia open! How funny is that picture! John, u ain't rite.

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Posted By: DJ

That is simply awesome Wonka! Nice work!

DJ