High grade cards are undervalued

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Posted By: daviddbreadman

I am going to put a thesis that is going to be disagreed with, but here it is.

Its my opinion that the market for sportscards, especially high grade ones... perhaps PSA 6 and above for a T206 for example, is becoming more effecient. In the stock market an efficient market is basically defined as a market that is priced such that all available information is taken into account and prices accurately reflect all available public information.

To that end, I beleive that high grade cards are undervalued and will continue to increase until the market reaches an equilibrium point on supply and demand. This 'hobby' has expanded to include more and more of us who beleive that cards are not only beautiful but have inherent value as investments. I beleive this growth in demand has outstripped supply by a huge margin that is largely unrecognized by those who have been in the hobby so long they are biased to want 'things as they were'. On the supply side, Population reports are invaluable and a must to gain proper market information. I also beleive that as the market becomes more efficient there will be less and less high grade raw cards as owners look to 'legitimize' their cards by getting them graded. It will become a must if you want to sell your card for its full value. This will increase the accuracy and quality of information gained in population reports.

I can go on and on with my argument but will stop here and state lastly that contrary to what I read on this board I beleive that those paying so called exorbinant prices for high grade cards are indeed the 'smart money'.

Times are changing and those of us participating in this hobby must constantly evolve our thoughts to survive.

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Posted By: Keith O'Leary

Now theres a different point of view!

Guess my collecting days are over .

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Posted By: David Vargha

Gotta get to work, but here are my quick thoughts . . .

Above all, the marketplace will determine value, whether we agree with the judgment of the market or not. Like it or not, the PSA Set Registry has changed the card collecting landscape forever. Additionally, the population reports, while not fully accurate, have become a valuable gauge in determining relative scarcity.

It really depends on how you define "high end". If you are referring to pre-war sets where cards in EX, PSA 5 or SGC 60 condition are scarce, then I would most certainly agree. If you are talking about condition rarities for set registry collectors (such as the much ballyhooed PSA 8 Goudey card that has been discussed ad nauseum on this board), then you have a mixed bag. Again, refer to my point above regarding the marketplace. If two or three collectors are heavily pursuing that set and card, then prices will be strong. However, a population shift of even one more at that grade or the elimination of competitive bidding for that card results in a substantial drop in the hammer price. Once you start to get into condition rarities for the 50's and 60's, the proposition becomes even dicier.

(edited to correct bad grammar)

DavidVargha@hotmail.com

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Posted By: identify7

I agree with your assessment in general, however, I think that as cmoking has pointed out; lessons can be learned from more mature hobbies.

Specifically, although grading has many advantages, many astute collectors prefer direct contact with their cards. Independent of third party documentation, identification of the best examples of the more desireable cards will occur. The result will be a condition census in which specific identification of each of the top cards will be established and their ownership tracked.

This process will show the population of the desireable cards in the top grades which they exist. In most cases these cards will all be 10s. For less common cards, those which have survived may be in any condition. All cards which fall below the condition census will be far less desireable; although still possibly good investment items.

High end card population reports generated by grading services must be inaccurate. The difference in values between top grades will continue to mandate resubmissions in an attempt to achieve a higher grade. The cost effectiveness of these resubmissions on just a single upgrade will continue to make the gamble worthwhile.

What results is a population report which containes data skewed by these attempts to achieve a higher grade and slabs which contain cards which just barely squeeked through to get that higher grade. Upon achievement of this status, having a slabbed card is admitting to owning low end (for example - PSA 9). So instead of a pedigree, a slab becomes a stigma.

I hope I have stated my opinions clearly enough to be understood. Certainly I may be wrong in my forecasts. But not necessarilly.

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Posted By: cmoking

David,

You stated an opinion, which is fine, but you don't back up your opinion with anything credible. Sure the market is getting more efficient, but efficiency doesn't mean higher prices. Efficiency could lead to lower prices. Your opinion may be right (I'm not arguing either way), but you lack any valid reasoning why you hold your opinion. Yes, supply and demand should meet at the efficient price, even in a hobby, but you don't state why you think that efficient price is higher than the price cards are selling for now. Maybe you have other things on your mind in this issue, you state that you 'can go on and on', I'd like to hear more logic behind your reasoning.

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Posted By: Hal Lewis

I don't think it is possible to know YET which way it will go... because I think it is "card specific."

Take this specific card for example, as it is clearly an important card:



To date, there are only 3 such cards graded HIGHER than this one. Those PSA 8's are selling for $125,000 with the juice in major auctions.

If 20 years from now there are STILL only 3 such cards graded higher than it...

then I completely agree that this card is UNDERVALUED and will be worth a great deal more at that time because of its rarity and its fame.

BUT...

if 5 years from now there are 13 such cards that are graded higher than this one, then I believe that the value will indeed fall down a good bit.

SO...

the big RISE in prices of vintage graded cards is important in the long run, because it is the ONLY thing that can perhaps drive all vintage cards OUT of long-time "collections" and into the "free market." People just can't afford NOT to sell them.

THEN... and ONLY then... when a majority of the cards are graded and accounted for... will we have a much better sense of how many high-grade cards exist and what they are truly "worth" to collectors.

REMEMBER...

while there are a LOT of cards still ungraded in private collections, there are also a lot of nice "looking" cards that will NOT grade too high. This is why they remain ungraded.

A lot of old-time collectors trimmed their cards, so they may LOOK pristine but will NOT grade well.

A lot of old-time collectors glued their cards to something, thereby messing up the backs.

A lot of old-time collectors didn't care too much about scratches on the surface or creases or corner condition.

AND...

since we are talking about OLD cards that are ONLY still around because they were saved by these very same collectors...

the odds of finding a high-grade rare vintage card that just "shows up" somewhere are slim to none.

BUT...

there WAS a huge find last year of MINT condition 1914 Cracker Jack cards that sold for $800,000 for the whole set...

so let's keep an eye out and see what that does to the value of all the OTHER graded 1914 CJ's that PREVIOUSLY had been considered some of the highest graded examples.


Does anyone know what the "find" of 1914 CJ's has done to the price of OTHER high-grade 1914 CJ's???

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Posted By: FYS

The market is far from efficient at the moment. There are conflicting views regarding how much product has yet to be uncovered and how much product is sitting in private collections that refuse to use 3rd party grading. You will also get varying views on how many people actually collect particular sets and to what degree (low grade/taking their time etc.). In order for a market to be efficient, all known information on a particulary must be public. That is far from the case. Population reports, eBay completed and the number of posters on this and other forums does not equal efficient information. More efficient, yes, but not efficeint. There are also many long time collectors that have knowledge and information about various collections that few other people are aware. Again, this contradicts an efficient market.

In any case, who cares, collect what you enjoy and pay for what you can afford.

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Posted By: identify7

I care.

Not because I will ever own a high ticket card.

Solely because I want to know the scope of collectibles in my hobby. I want to know if Hal's Ruth is third best or thirtiest best. We can not even determine orders of magnitude here.

Persons have put away cards when they were very inexpensive, and although they have appreciated very significantly, current values do not flush them out. I do not think that anything that can happen in the hobby, will flush them out. Because I think that many of the holders of these cards are not in touch with the hobby nor need to cash out the heirlooms.

But what do I know? Nothing. This is solely speculation. Maybe there only exists an insignificant quantity of important cards which the hobby is unaware of. But important stuff keeps popping up.

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Posted By: T206Collector

General statements about how market price is driven by supply and demand (okay, I follow you up to this point) followed by broad, unsubstantiated and flawed assumptions about the supply and demand of baseball cards in various conditions and across 3/4 of a Century today does not persuasively argue that the market for vintage cards is "efficient" or nearly establish that relying on population reports to determine relative scarcity is anything other than inane.

As I have previoulsy opined elsewhere in this forum, people who argue that population reports establish relative scarcity are more likely than not defending expensive purchases that they have made. It is just that simple. Nothing more than the biased opinions of collectors who want to believe they own the only truly mint T206 Unglaub card, and then want the rest of the world to believe they made a good investment by spending more than a $1,000 on it. The only way that makes sense is if you buy the skewed view of the world set forth in the various pronouncements above (and in other posts on this forum).

With any economic model -- whether you are calculating the gross domestic product of China, or the market value of a T206 Grimshaw in PSA 7 condition -- there are always going to be assumptions drawn. It is beyond refute that the assumptions being drawn by those deluding themselves (and others) into thinking that population reports actually reflect true scarcity in the market are deeply flawed. It reminds me of an old "joke" that I was told in one of my economics classes in college:

A philosopher, a chemist and an economist are stranged on a desert island without anything to eat. Just before they are about to starve, a crate with hundreds of cans of food washes ashore. The three gentlemen set to work devising a plan to open the cans.

The philosopher recommends that they all sit down and really think about whether or not there really is food in the cans.

The chemist disagrees, explaining that it would be much better to leave the cans in saltwater long enough so that the cans will corrode and open on their own.

The economist just shakes his head at both of these suggestions, and replies, "Fellas, it's easy. Just assume a can opener."

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Posted By: warshawlaw

that rarity is not the same as condition rarity. High grade cards that are rare are good investments. High grade cards that are condition rarities (i.e., there are lots of lower grade specimens) are much more speculative investments. They depend on the continued competition of a comparatively small segment of high grade set builders. I would much rather have a PSA 3 T206 Plank than a PSA 8 T206 Cobb because I know that the Plank will always be in demand from a wide audience of collectors.

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Posted By: Hal Lewis

I agree with the "assumption" made by my fellow economist, Dr. Warshawlaw.



The way I see it, there are THREE categories:

1) RARE cards that are SO rare that they are very valuable in ANY condition. (1914 Baltimore News Babe Ruth, 1910 T210 Joe Jackson, etc.) These are so rare that the discovery of a new one will probably NOT change the market price at all.

2) SEMI-RARE cards that are in high demand at all grades -- which means that the higher graded versions are very valuable while the lower grade versions can be seen for sale fairly frequently (1915 M101-5 Babe Ruth, 1914 Cracker Jack Ty Cobb, etc.) These could be affected price-wise if new high grade examples appear in the future.

3) COMMON cards that are ONLY in high demand at the HIGHEST graded levels. These stand to face the biggest loss in value when and if other high grade versions of the same card come to the market.

------------------

Then again... there is the age-old question:

Is it more likely that someone stashed away their 1933 Babe Ruth card in a box so that it may still be found in pristine condition by future treasure hunters...

or is it more likely that a random common player's card will show up?

Just ask the people hunting for BID McPHEE cards about this phenomenon. Apparently everyone in 1889 knew that they should keep their King Kelly OJ's... but hardly ANYBODY from 1887 to 1997 gave a second thought to trading or tossing out a Bid McPhee OJ.

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Posted By: John

Really if that’s the case David then I’ll ask you to explain this?

Aug. 2000 Auction final price $16,016.05 without (15%) buyer’s premium.

http://www.mastronet.com/index.cfm?action=DisplayContent&ContentName=Lot%20Information&LotIndex=42254

Cant be a bunch of PSA 10’s haunting the so-called population report right? Supply vs. Demand way off the scale right, 5 yrs to mature the investment of the card above right. So why the hit?

You say it’s not a HOF player and high-grade commons can be all over the place. Ok I’ve heard that one too then explain why this card has only increased in value in over 5 yrs by an amazing $476.00?

Aug 2000 Auction final price $40,250.00 without (15%) buyer’s premium.

http://www.mastronet.com/index.cfm?action=DisplayContent&ContentName=Lot%20Information&LotIndex=48949&CurrentRow=1

5 years to make $476 on a $40,250 investment doesn’t sound too good to me.
I take it back it did have a 2% increase thanks to Mastro raising the buyers premium.


“I can go on and on with my argument but will stop here and state lastly that contrary to what I read on this board I believe that those paying so called exorbitant prices for high grade cards are indeed the 'smart money'.”

David, if the gentleman above bought the cards for a cash return and used the 2 above as an investment tool. Then I think its safe to say that a total investment in Aug 2000 of $64,705.95 for a return of $56,200.90 in 2005 resulting in a loss of $8505.05 in 5yrs isn’t smart money, but more of a I should wear a padded helmet around the house kind of money.

If however these gentlemen bought these cards because they love the hobby have the cash to do so, and could care less about a loss. They just wanted to say rent them for a while. Then there’s not much one can say other than I guess its good to be them.

You guys crack me up; every slab head here spouts all sorts of fancy phrases (Supply vs. Demand, population vs. scarcity, market trends) if all this stuff was true then things like that above wouldn’t and couldn’t happen right?

And Hal a lot of nice cards remain in “old time” collections because these people don’t care about PSA, SGC or any of them. That’s why they haven’t spent thousands slabbing their cards, not because they’re afraid of what they might find out about their collections. They haven’t slabbed because they don’t care, and their items aren’t for sale until most of them are dead sad to say.

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Posted By: Julie

1) when I sell my collection, it will be because I am poor, not because the market is efficient.

2) When I buy or trade for a graded card, I don't feel I've finished unwrapping the package or know what the card looks like until the card is out of the hoilder.

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Posted By: Hal Lewis

John:

They will die eventually... and their cards will eventually be slabbed.

Are there ANY famous high value COINS that have not yet been slabbed??

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Posted By: Hal Lewis

Here are two one-of-a-kind rarities that need to be slabbed for sure!!

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Posted By: John

LOL, The Lewis looks Trimmed!

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Posted By: Anonymous

There is no need to slab rare items.

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Posted By: Josh K.

Hey John,

Dont lump all slab heads together. I like slabs - not because I cant determine if a card is real or not (though it certainly helps when buying over the internet and with issues you are less familiar with) but because I like the looks of my vintage cards in sgc's holders and I like the protection they offer.

I also dont collect super high grade cards, just nice midgrades (40 to 60 usually) and spending multiple thousands on a high grade common is the last thing I intend to do with my money.

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Posted By: T206Collector

I love SGC. I have my best condition T206 cards graded by them. They look nice, they preserve well, the registry is fun, and the resale value is excellent. But I would never presume that the population report means anything about relative scarcity.

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Posted By: Dean H

I agree with both Josh and T206Collector. I like slabs because of the protection and presentation they offer. Don't most collectors slab their cards in some way? Even raw collectors "slab" or protect their cards in some fashion like lucite holders. Do raw collectors actually handle their cards that often? I'm not trying to being facetious, but honestly curious. Yes, it costs more for professionally graded slabs, but I feel it is worth it. Just my $.02.

Dean

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Posted By: JimCrandell

David,

You are absolutely right. The demand for high end graded vintage cards(which I would define as PSA 8 or better)is outstripping supply and prices are rising.

The supply of these high end cards is limited and it is unlikely that demand will drop.As others have said and I agree most pre-war cards that are not graded will not grade at 8 or better. Pop reports are an invaluable tool.

The times are a changing and once the holdouts pass on or sell their collections the new owners will likely slab their collections.

And David Vargha, you are certainly correct when you say that the PSA Set Registry has changed the collecting landscape forever--in my opinion all for the better.

This all means greater effifiency in the pricing of vintage cards.

Jim

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Posted By: Josh K.

Jim/David

You state that the demand for high end cards is on the rise and that prices are following. Yet neither of you have addressed the only two examples provided above by John which would tend to indicate that your presumption is not entirely accurate.

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Posted By: T206Collector

Jim,

You have obviously spent a lot of money on PSA 8 and higher vintage commons. You have apparently done this with investment on your mind. And you may be right -- at some point in the future these cards may be higher than what you paid for them. But there is certainly no guarantee that that will be the case, even if your statement that prices are now rising were true. Indeed, the evidence in this thread alone is that sometimes (and perhaps often) prices drop precipitously. This is what we call a volatile market. Your purchasing decisions reflect highly risky investment behavior. I would counsel caution and thus that you avoid making statements that have never been true in the context of any market, including vintage baseball cards, such as "it is unlikely that demand will drop." Similarly, given the short life of the PSA Set Registry, broad statements like "the PSA Set Registry has changed the collecting landscape forever" are short-sighted.

Demand and supply (and therefore price) will continue to fluctuate no matter how close to perfect our knowledge is about the existence of a particular issue, i.e., in the most efficient market for baseball cards imaginable, prices of baseball cards will often fluctuate greatly because price will never be judged by how many cards are in existence at a certain grade. Rather, price will be determined by how many are available for sale at the time that a certain number of people are willing to buy at that time of availability. Even if all of the 1958 Topps cards in existence were known and accounted for, supply and demand as a determinant of price would fluctuate dramatically for the rest of eternity based on how many were actually for sale and how many were actually in demand at the specific point in time.

If you spend thousands of dollars on mint commons, more power to you. But do not fool yourself into thinking that you are making a sound investment with no risk. Rather, the risk is actually pretty substantial. Especially if the vintage baseball card market is on the verge of collapsing. Swiftly rising prices are usually evidence of an imminent collapse, not a continuing trend.

Paul (aka T206Collector)

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Posted By: identify7

Dean:When I obtain cards in slabs, I usually take them out of their holders the day which I get them. Now admittedly, I almost never buy cards above 6s, so the fear of damaging them is not as great as it would be if the cards were of higher grade.

But to never feel the coarseness, slickness, heftiness, smooth texture, flimsyness, etc. of your cards (imho) is really depriving yourself of a lot.

And as you speculate, they will end up in a sleeve, holder or some custom display for much of their life, until I rearrange them again. But this temporary encapsulation will be far less bulky and far more attractive than a slab. Heck one slab occupies the same space as a half dozen top loaders.

Slabs would be great for me if I collected a dozen or so rare, or otherwise costly cards. But I collect lots of different players. Plus I collect other things. Organization, presentation and manipulation is a portion of my collecting enjoyment.

I hope this answers your question. We are all different and all the same.

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Posted By: warshawlaw

For what it's worth, I track boxing card prices quite carefully and see pretty wide (by %) differences as time goes by in buy prices for high grade "available" cards (e.g., 1948 Leaf, 1951 Ringside, 1956 Adventure) in the same grade (PSa 8 for example). The vintage boxing market has risen (percentagewise) as fast as or faster than the vintage baseball market, at least since I've been covering it.

Having a card hit a record price at one sale is no guaranty it will break the record at the next. After all, if we all knew the cards would go up absolutely, we'd not bother with stocks, bonds, real estate, etc.

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Posted By: JimCrandell

Paul,

You don't know me so please don't say why I collect cards. I am passionate about collecting and love the hobby. I am trying to collect over 100 vintage sets in psa 8 or better. Why-I love high grade cards. I do not like the way cards look with creases, rounded corners or when they are off-center.. Investment is not a major objective although I have done unbelievably well with my high end graded cards. I have recently sold groups of T206s and M116s in psa 8 and 9 at 8-10 times what I paid for them. Will they continue to go up? Probably, although there will be ups and downs along the way.
Of course card prices can drop and anyone can site instances of this. For one thing all psa 8s are not the same. However, the grading of sportscards has bought a large number of high-end collectors into the market who now can buy cards with the assuredness that they have not been altered. I don't see this trend ending anytime soon...sorry
Sorry again but no matter how much you may wish it to be true I must agree with the earlier statement by my friend David Vargha that the PSA Set Registry has changed the collecting landscape forever. Things will not only not go back directionally to the way they are they will inexorably head toward more graded cards, more graded sets and more sets listed on the PSA Set Registry and also the SGC and GAI Registeries....the only question is the pace of that change.

Jim

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Posted By: John

Sorry Josh didn’t mean too lump all slab heads together, I too like the holders too that’s about the only thing I like.

Josh, David and Jim probably wont address what I pointed out because it ruins the canned response that all these guys paraphrase from the PSA website to make them selves feel better about their purchases. The fact of the matter is if you really follow these high dollar cards I have found for the most part they either lose value or maintain the value at best, which is fine because there baseball cards, not investments!

I’ve checked the top Fortune 1000 richest people for the past several years, have yet to see anyone who made their fortune selling baseball cards go figure.

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Posted By: Josh K.

John,

No worries - I knew there was nothing bad meant in the earlier thread - just needed a snappy lead in for my thoughts.

As for the investment value of high grade commons - I agree. Boy, cant you just see Adam M. pounding the sand right now because he cant weigh in on this matter.

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Posted By: JimCrandell

Anyone who thinks high end vintage cards have overall declined in price is living in a dream world...dream on.
The price appreciation in high end vintage cards is so dramatic it is not worth debating.

Jim

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Posted By: John

Yeah no kidding Josh! Adam M. “Let me at 'em, Let me at 'em!”

Jim I have links to my dream world above, care to share your thoughts or would you like to cut & paste some more PSA babble.

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Posted By: cmoking

John, are you saying those two cards you pointed out is an indication of how vintage high grade PSA cards have done in the last 5 years? If that's not what you are saying (it sure seems like what you are saying), then what exactly are you trying to say or prove?

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Posted By: John

If your asking my point I was making, sorry I thought it made sense what I was saying.

Jim and others have said time and time again that high-grade pre war cards 8 and higher are not only difficult to come by but will hold there value and will almost double in value. That these cards are smart investments and will only continue to skyrocket in price. Just in my little niche of T206’s I have seen many things that point to the exact polar opposite of what these people are claming, I posted the two most recent ones I could remember above.

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Posted By: cmoking

" Just in my little niche of T206’s I have seen many things that point to the exact polar opposite of what these people are claming, I posted the two most recent ones I could remember above. "

What about all the T206 cards - or the majority? In any situations, there can be abberations - maybe your two examples are the abberations, but the whole has gone up. Not being a T206 collector (in any grade), I wouldn't know. But I suspect the average T206 PSA 8 card has gone up in the last 5 years. Is this wrong? In any big bull market, there can be examples of individuals that actually went down.

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Posted By: John

Jesus X you know the rest…

Cmoking those are pretty big aberrations above. If you’re asking me to do extensive market research on all T206’s that have sold over the past 5 years and provide a report don’t hold your breath. But I have at least provided 2 links to 2 very high profile seemingly rare cards, which have taken large hits or stayed at the least on par for what they sold for 5 yrs ago. This goes against the grain with what many of you have stated (with no proof what so ever I may add). It’s simple if high grade materials are going through the roof and it’s a smart and safe investment with great return potential, then I would expect a PSA 8 Cobb Green and PSA 10 Gem Mint card would be on the list of cards you guys seem to think are doing so great. So I’m asking why the loss the math doesn’t add up.

And lets not get into Bull market stuff baseball cards are not stock, and aren’t regulated by any federal agency. Thank god for that huh?

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Posted By: Josh K.

Ok class,

For your assignment tonight I would like a paper, 100 words or less. Oh, your topic . . . "The greater fool theory." Class dismissed.

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Posted By: cmoking

" Just in my little niche of T206’s ..."

I thought that was your niche, that's why I asked you. You are right in that not all cards have gone up...but I believe you are wrong about the majority of cards as a whole.


'my little niche' is in 1933 Goudeys. Here are some cards that just sold in auctions this past month. And equivalent cards that sold back in 2000.

1933 Goudey Frank Hogan PSA 8
Sep 2000: $1352
Aug 2005: $3680 Superior

1933 Goudey Ray Benge 141 PSA 8
June 2000: $782
Aug 2005: $1903 ebay

1933 Goudey Charley Gehringer 222 PSA 8
June 2000: $2531
Aug 2005: $4814 Mastro


I don't want to be taken the wrong way though. I don't view cards as an investment. I view them as a hobby and my collection. I don't buy cards thinking I'm going to make money on them, I buy them because I like them and I want them in my collection. I would never suggest someone invest any money in cards. But at the same time, I think you are using two examples to show something that isn't the case in the group of cards as a whole, and that's the only reason I posted. I understand you don't like the slabs, the registries, etc., and I respect that.

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Posted By: daviddbreadman

I should have been more elaborative in my post:

#1 I have never purchased a card over $250 (with the exception of a T206 O'Hara St. Louis). My statement was not made to validate my purchases of overpriced cards.

#2 I was not referring to ultra-high value cards. Those cards have obviously arbitrary pricing and vary wildly from year to year. In general i was referring to cards priced from $200-$3000. A good example of my belief is that a PSA 6 T206 would appreciate from 150-250 to $500.

#3 Prices are absolutely NOT determined by the number of cards in circulation but rather by the number of card readily available to meet current demand. Thus, a hoard of hidden raw cards not covered by a population report has not and will not have any effect on current pricing. (current also
refers to the static supply/demand at any fixed future point in time)

#4 the market for cards is becoming 'more efficient', i did not state or mean to state it 'is efficient'. it will become more efficient at an accelerating rate over time, hence my thought that pricing will continue to rise.

#5 a Babe Ruth rookie is not the type of card i am referring to.

#6 talking about economic theory is simply theory, i speak of reality. theory and reality are not always the same in economics. however, population reports when taken as a whole are accurate measures of relative scarcity.

#7 i collect cards because i love them. i have been collecting cards since 1977. admittidly i have only been collecting prewar for less than 1 year. i collect cards and my purchase always has 2 factors, #1 do i want this card for the card's sake and #2, can i/will i recoup the money i spend on it should i decide to sell it. money is a factor.

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Posted By: cmoking

1933 Goudey 25 Paul Waner PSA 8
Dec 2001: 4543
Aug 2005: 9600 Mastro

1933 Goudey 55 Pat Malone PSA 8
Dec 2001: 1955
Aug 2005: 13,600 Goodwin

1933 GOudey 91 Tom Zachary PSA 8
Dec 2001: 518
Aug 2005: 921 ebay

1933 Goudey 124 Earl Whitehill PSA 8
Dec 2001: 385
Aug 2005: 472 Superior

1933 Goudey 99 Tony Cuccinello PSA 8
Dec 2001: 337
Aug 2005: 1898 Superior

1933 Goudey 157 Oswald Bluege PSA 8
Dec 2001: 385
Aug 2005: 1610 Superior


yep, I think PSA 8 1933 Goudeys have gone up, in general, over the past 5 years.

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Posted By: John

Cmoking, I’m sure some have gone up no doubt. However I don’t think by showing the above cards is wrong or misleading in any way, if you want to take it as a take on the card hobby as a whole that’s fine. I posted it for what its worth for everyone who post cards that have doubled or claimed to have made double from card investments. I posted just two quick examples of the exact opposite. I’m sure if I dig deeper I could find more as could you to argue both of our views.

My question was a simple one if high-grade pre-war is so hot and such a sound investment why the dump on those 2, that’s all I was asking. Sorry if I wasn’t clear.

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Posted By: cmoking

1933 Goudey 79 Red Faber PSA 8
Mar 2002: 903
Aug 2005: 1944

1933 Goudey 125 Bill Terry PSA 8
Mar 2002: 1380
Aug 2005: 1485

1933 Goudey 53 Babe Ruth PSA 7
June 2002: $8625
April 2005: $24,000 Sothebys
Aug 2005: $18,000 Memory Lane

1933 Goudey 106 Nap Lajoie PSA 6
June 2002: 17,825
Apr 2005: 29,000 Mastro

1933 Goudey 3 Hugh Critz PSA 7
Sep 2002: 4,715
Aug 2005: 1,150
OK, you got one here!

1934 Goudey 32 Blondy Ryan PSA 8
Dec 2002: 345
Aug 2005: 1400

1934 Goudey 65 Cliff Bolton PSA 8
Dec 2002: 403
Aug 2005: 800 Goodwin

But again, with that said, I'm not saying hi-grade vintage PSA 8 cards are a good investment...just saying they have gone up in the past 5 years.

Of course, this doesn't mean these cards were even a good investment relative to other things in the world. For example, my Vanguard Mid-Cap Index went from $48.77 in July 2002 to $76.48 today (it's even higher because of dividends). And those card prices may not compare to home prices. So the value may have been better in other things and not cards.

Again, I'm just pointing out the high-end cards that have sold recently in some auctions, where I can track other cards that sold in the past as well. But past performance is no indicator of future performance. (I know, too much like stock talk, right? Sorry).

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Posted By: jay behrens

And yet you guys keep ducking John's question. It's like listening to a PSA parrot speak. What we really want to hear from you guys is why those supposedly rock solid investments went south so badly, not another string of PSA pablum and more proof that cards went up. Explain why those 2 didn't when according to you guys, they should be skyrocketing.

Jay

My place is full of valuable, worthless junk.

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Posted By: David H

Come on, you guys are clinging to two radical examples to prove my general statement false. Using those two sole examples to prove me wrong is a weak argument.

At any given time any one buyer can make poor choices and overpay for a card. A mistake on two peoples part does not invalidate 99% of other peoples decisions. You may disagree with my statements but to use these two examples to prove me wrong is not worth discussing further.

Second, this board is full of intgelligent people, no? i have seen alot of very smart people here. Surely you can grasp the simple concept that once you get into certain very high price ranges, prices become aritrary at any given time based on what one or two people are willing to pay at that moment. Be serious, is anyone really saying that because these two cards sold for less that the market for high quality and grade vintage cards has gone down over the last 5 years? i have seen at least one of you personally make statements that the market for cards as a whole is now out of your reach, yet you argue the opposite here?

Those two examples are not relevent to my statement.

For the record, i have no idea what the PSA site says. I have formed my own opinion independent of any grading company touting their products for financial gain. I am no parrot. I just happen to have what appears to be a different opinion from those here who feel otherwise.

I continue to beleive that high grade cards (valued generally from $200-$3000) are very underpriced.

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Posted By: T206Collector

I agree that the market will become more efficient as more cards are graded. I do not think that efficiency equates to rising prices. When Score issued its 1990 set, it did it in dribs and drabs, raising price because demand was higher than supply ...and then dumped a billion cards on the market. When collectors got wind of the surplus, the market became efficient but prices plummeted (and a short time later Score went out of business). Indeed, the market for 1990 Score cards continues to be very efficient, but prices will always be about a nickel a set.

I will also concede that prices on T206 cards, at all grades, have risen substantially over the past 5 years. I was kicking myself at the East Coast National last week because an SGC 4 Cobb that I wanted was well over $1,000. Had I been more diligent a few years back, I could have nabbed one for $700 or $800. And I do not have much confidence that the Cobb market will cool off significantly over the next few years, though I remain slightly hopeful that it will.

But, I do not share in the overbroad statements about the safety and security people feel in paying thousands of dollars for PSA 8 and higher commons. It is market price dictated by irrational actors in the market. When you see price jumping up and down a lot at the upper end it is because -- as has been acknowledged by the true believers -- only a few actors are participating in the market at that end. That is why you see volatility and that is why such investments are irrational. You're making purchases in the hopes that when you sell at least two people are going to wet their beds coming up with the money to pay for it. It makes a lot more sense financially to stick with cards that have a broader market base. If you are just purchasing PSA 8 commons because you need the sharp corners at any cost, be my guest. Just do not fool yourself into thinking there will always (or even likely) be any takers at that price if and when you finally decide to sell.

Finally, I own an SGC 80 T206 Mathewson portrait. I love it, will never sell it, and paid only $800 for it about 5 years ago (then in a PSA 6 holder). In February 2004, a PSA 6 Mathewson portrait sold on eBay for $3,500. I was ecstatic, of course, because it meant I owned a $3,500 card. Only, that is the only time I have ever seen one sell that high. Ever since, the same condition Mathewson portrait has been selling at about $1,500 to $2,000 tops each time it comes up on eBay. Now, will it get back up there in the future? Who knows. But I do know that of the two bidders who forced the Matty up to $3,500 on that February evening back in '04, the one sitting pretty is the underbidder.

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Posted By: John

David;

Don’t twist what I posted around please. I posted the 2 above as a simple sample of high grade “PSA 8 and up” not reflecting the solid growth or booming launches in prices you guys continue to describe.

It was in no way intended to be a barometer for the card market as a whole I never said that, and if you read into it that way, I’m sorry.

“Surely you can grasp the simple concept that once you get into certain very high price ranges, prices become arbitrary at any given time based on what one or two people are willing to pay at that moment.”

Couldn’t this rationalization be used to debunk the 1933 Goudey cards that Cmoking posted as well? How is posting selected pluses from you’re column any less biased than me posting the negatives I found in my column? Can’t this formula go both ways or does it only work in your favor and is silly when pointed to my point of view.

“Be serious, is anyone really saying that because these two cards sold for less that the market for high quality and grade vintage cards has gone down over the last 5 years? “

I was being serious; I find this no sillier than you guys posting a handful of Goudey commons that people were in bidding wars over as a reflection of the market being stronger than ever before with little or no chance for risk.

“I continue to believe that high grade cards (valued generally from $200-$3000) are very under priced.”

That’s wonderful David then you should be very happy with the current PSA 8 and higher prices, and should be buying up some sweet deals. After all you have nothing to lose, the 2 lame examples I posted shouldn’t make any intelligent buyer such as yourself question price what so ever right?

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Posted By: David H

I can't afford PSA 8 T206. I feel there is better value in PSA 6 T206, as i feel they have some catchup to do.

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Posted By: identify7

It seems to me that the values of cards increase over time. So if you hold your cards for a decade or more, the peaks and valleys are normalized out and you will see an appreciation. It may not be your best investment, but you do get to enjoy the cards throughout the investment period.

This fact does not only apply to cards. It also applies to your salary, home value, educational cost and many other costs and values.

It seems reasonable to me to collect the shineiest old cards which you can find. So where is the beef?

Certainly there are other ways to collect baseball cards. But high grade cards is one way.

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Posted By: warshawlaw

I happen not to like a high grade common in lieu of two or three midgrade HOFers.

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Posted By: Anonymous

Hi guys,

This is a very interesting thread and I thought I would step out of lurker-status, as dangerous as that may be, and ask a question.

I'm pretty new to collecting pre-war sports cards and memorabilia (Boston Red Sox to be exact), but have a lot of experience collecting brewery advertising of the same vintage that is the topic of this forum (1880s to 1940s or so). I've been collecting this stuff with my dad for the past thirty or so years (which is, by the way, the most valuable asset to our collection, not the monetary value of the pieces themselves...When people ask me what our collection is worth I honestly have to tell them I really have no idea).

Like sports memorabilia, the "breweriana" field as it's known shares many similarities with the card field when it comes to the placement of "value" on any particular item. I can tell you from any collecting field, that any hobby will go through cycles in terms of value. At one time it's hot, the next it cools off. Beer cans were super hot two years ago, they've since cooled off a bit. The rarer items will maintain or increase their value over time, the less rare may not, even if a piece is in great condition if there are many others available out there in a lesser grade. Of course, "value" is placed by the pocketbook of the person looking to acquire it. In the future, if those wealthy enough to purchase an item are not interested in it to begin with, or they already have one, or there is less competition with others for the same item, it will sit for sale with a price tag that's soon to become a collector's item by itelf.

Anyway, in trying to acquire a working knowledge of the sports hobby and the "value" placed on specific cards in order to build my collection, I'm amazed at the prices that some cards realize based on their actual availabilty, particularly on the internet. Why is this? In other words, it seems to me, new at this as I am, that many cards seem Overvalued, not undervalued, based on how many there are out there for sale. I recognize the importance of back varieties and condition and the way they effect value, but I often wonder why some cards achieve the prices they realize when I see them over and over again for sale.

My question, to anyone who is kind enough to answer, is how rare are some of these cards that command high prices? Are there so many collectors out there that seemingly (fairly)common cards are designated as "rare" or highly valuable just because of the ratio? The reason I'm asking is because "rare" to us in the beer world means essentially the only known example known to exist or maybe one out of two or three. About 90% of our collection is composed of pieces which are the only known examples found to exist.

As an example to my question, any day of the week, you can find a T206 Tris Speaker for sale. If you wanted one in top condition, you might have to wait a month or so until one becomes available, but I would think you could get one from what I've seen. I saw one recently sold at auction for $2800 if my memory serves me correctly. I saw another sold a couple of months back for $800 or so in slightly lesser condition. Right now, another is for sale. Why does this card demand such a high price? Is it the back, or is a sharp corner so important that it increases the card's value by a couple thousand dollars?

I'm not trying to degrade the hobby with my question. I'm just pretty ignorant on the subject and thought I would throw out my question to you folks who seem pretty educated in the subject.

Thanks for your help in advance.
Greg

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Posted By: Julie

and i once saw a PSA 9 T206 Waddell that someone held under my nose, and it scared me. I didn't know they had machines that cut anything that sharp except diamonds (after 1910 for the diamonds, of course). As an antique, I wouldn't touch it with a ten-foot Lithuanian.

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Posted By: identify7

Beer cans cooling off? Oh no!