Money in the Hobby

[Yoda]

After perusing the early bids in the current Heritage "Platinum Night" auction, I am reminded again of the large pools of capital ready to pounce on any high graded star/HOF card. It got me thinking back to college Economics 101 with
price elasticity, supply and demand curves, equilibrium points and the like.
What factors are at play? Here are just a few random thoughts:-
1. With the stock market at record highs and the Trump tax bill safely passed, people with large amounts disposable income people are feeling confident, and this has translated into new, existing and once dormant collectors bidding up cards. Given all recent media musings that old baseball cards of the immortals is a good investment, perhaps many may look at card purchases as asset reallocation instead of reliving boyhoods.
2. There will always be more money in the country than old, nice cards. Unless there is some crisis that spooks financial markets and creates a dumping of all those beautiful Ruth, Cobb and Jackson cards, doesn't that mean that prices are elastic and should continue to rise.
3. So many great old cards have been offered for sale over the last 10 years I
wonder how many new finds can be expected and, of course, there are serious
affluent collectors who have no intention of ever selling anything; they just love their cards too much.
Personally, Heritage has some eye-watering cards on display, but I am already priced out.

[packs]

Over the next 20 to 30 years I think there will be a HUGE drop in prices for cards. When boomers die out and new buyers are scarce, you'll see lifetime collections go for a fraction of what they would today.

[Snapolit1]

Originally Posted by packs

Over the next 20 to 30 years I think there will be a HUGE drop in prices for cards. When boomers die out and new buyers are scarce, you'll see lifetime collections go for a fraction of what they would today.

No offense, but I'm certain people were saying the exact same thing in 1975.

Has the market collapsed for George Washington signed documents?

Has the market collapsed for rare hot rods from the 1950s?

Has the mark collapsed for vases from the Ming Dynasty?

No. Not saying every card will hold its value. That's not true for anything.

When I was growing up a few dads collected stamps and coins. Yes, the run of the mill stuff has not appreciated. The rare stuff has. And believe me people are more emotionally invested in baseball cards than airmail stamps.

[barrysloate]

Originally Posted by Snapolit1

No offense, but I'm certain people were saying the exact same thing in 1975.

Has the market collapsed for George Washington signed documents?

Has the market collapsed for rare hot rods from the 1950s?

Has the mark collapsed for vases from the Ming Dynasty?

No. Not saying every card will hold its value. That's not true for anything.

When I was growing up a few dads collected stamps and coins. Yes, the run of the mill stuff has not appreciated. The rare stuff has. And believe me people are more emotionally invested in baseball cards than airmail stamps.

The market for antique furniture has pretty much collapsed. Anyone I know who were collectors or dealers for a long period of time say the same exact thing- the antique market is dead. Not everything goes up forever.

[Leon]

Originally Posted by barrysloate

The market for antique furniture has pretty much collapsed. Anyone I know who were collectors or dealers for a long period of time say the same exact thing- the antique market is dead. Not everything goes up forever.

I bought a really nice Coca Cola tray, from 1921, around 17 yrs ago. I think I paid $800 for it as it's in great condition. Then the internet hit them, and exposed their lack of scarcity, and they go for around $350 now. Sure glad I didn't go big on them at the time. Not everything goes up but I am bullish on great vintage baseball cards.

.

[ls7plus]

Originally Posted by barrysloate

The market for antique furniture has pretty much collapsed. Anyone I know who were collectors or dealers for a long period of time say the same exact thing- the antique market is dead. Not everything goes up forever.

Boy, someone should tell that to "American Pickers" and possibly "Pawnstars" too--they certainly don't seem to be aware of it.

Hi, Barry!

Larry

[barrysloate]

Originally Posted by ls7plus

Boy, someone should tell that to "American Pickers" and possibly "Pawnstars" too--they certainly don't seem to be aware of it.

Hi, Barry!

Larry

Hi Larry,
Every so often Antiques Roadshow airs an episode taped 10-15 years ago, and after the expert estimates the value, they will show you what that same piece is worth today. Only rarely is something worth more, and the vast majority of the pieces will have lost 25-50% of their value. Also, any antique collector I have spoken with has the same pessimistic response: the market is dead. I'm sure you can always find someone who feels otherwise.

[bbcard1]

Originally Posted by packs

Over the next 20 to 30 years I think there will be a HUGE drop in prices for cards. When boomers die out and new buyers are scarce, you'll see lifetime collections go for a fraction of what they would today.

I doubt it. I think the old good stuff will always be the old good stuff.

[samosa4u]

Originally Posted by packs

Over the next 20 to 30 years I think there will be a HUGE drop in prices for cards. When boomers die out and new buyers are scarce, you'll see lifetime collections go for a fraction of what they would today.

I disagree with you. I was born in the 80s and I spend a sh*t-load on vintage cards. I also have many friends around my age who spend big money on cards too. And finally, the younger folks that I see - they are in their early 20s - remind me of myself when I was younger. They come to the shows and drool over the vintage cards that they see. They ask so many questions as well. The interest is there. I am certain that once these youngsters get a bit older (and have more disposable income), they will definitely start buying these old cards.

[Snapolit1]

I'm still waiting for the NYC real estate market to collapse like everyone's been telling me is inevitable (since 1970). Totally not sustainable. Yeah, sure.

[packs]

No offense but real estate, stamps, coins, and car markets have nothing to do with baseball cards. I am going out on a limb, but I'll venture to say that most people collect baseball cards because they collected them as children. Being born in the 80s and using that as some justification for a future vintage market doesn't hold water. Why? Because in the 90s baseball cards exploded. You could buy a pack of cards anywhere. They were always a part of your life.

I could not tell you the last time I saw a pack of baseball cards sitting out on a counter in my local grocery store. That connection just doesn't exist for anyone being born post-2000, which is who you'll have to rely on to buy your collection down the road.

[Rookiemonster]

Everything has its life ups and downs.comic were dead for years then came back like never before. What ever caused cards to go up a couple years back may happen again soon.I see and hear about young collectors all the time.

When I was a kid we had videos games and other distractions. I stopped collecting off and on for years. I’m not a baby boomer and mother are any of my friends that still buy cards. Maybe some lesser know player will fade with time like a max Carey , Paul warner, etc old hofers won’t always appeal to the future generations. As the games changes players won’t be viewed the same.

As in a football I like Benny Friedman. He had the rookie touchdown record season touchdown record, more yards then any other passer and he could run. Etc man a head of his time by decades !!! How many people know who this man is today???

[Stampsfan]

Originally Posted by packs

... I'll venture to say that most people collect baseball cards because they collected them as children...

People who collect Ming vases didn't collect them as a kid. People who collect rare pieces of art didn't collect that as a kid. Not so sure there is a correlation any more.

[joshuanip]

Originally Posted by Snapolit1

I'm still waiting for the NYC real estate market to collapse like everyone's been telling me is inevitable (since 1970). Totally not sustainable. Yeah, sure.

Reason why real estate held up is due to cap rate compression. Take a look at this chart on the risk free rate; created the mother of all junk rallies. Add to that limited land supply and rising replacement cost, and you got a secular boom. Going forward, that is an interesting forecast...

http://www.macrotrends.net/2016/10-y...te-yield-chart


On expensive high end cards...I like cardz...I think they are kool.

[Econteachert205]

Originally Posted by packs

Over the next 20 to 30 years I think there will be a HUGE drop in prices for cards. When boomers die out and new buyers are scarce, you'll see lifetime collections go for a fraction of what they would today.

I agree with this to an extent. The exception will be that the best quality and rare pieces will continue to go up. But I do question who will care to pay anything for a mid grade 1958 al Kaline in the future.

[Snapolit1]

Originally Posted by Econteachert205

I agree with this to an extent. The exception will be that the best quality and rare pieces will continue to go up. But I do question who will care to pay anything for a mid grade 1958 al Kaline in the future.

People aren't buying nice Ruth cards and Type 1 photos because it reminds them of being a kid. They are buying because they see the appreciation over time, have a lot of money to invest, and think why not plow a small amount into something cool like sports memorabilia. Can't call your buddies over and excitedly pass around stock certificates.

I agree that Al Kaline's rookie card won't mean much to anyone in 25 year. But the stuff at the top of the Heritage catalog will hold its value and likely appreciate.

[packs]

Originally Posted by Snapolit1

People aren't buying nice Ruth cards and Type 1 photos because it reminds them of being a kid. They are buying because they see the appreciation over time, have a lot of money to invest, and think why not plow a small amount into something cool like sports memorabilia. Can't call your buddies over and excitedly pass around stock certificates.

I agree that Al Kaline's rookie card won't mean much to anyone in 25 year. But the stuff at the top of the Heritage catalog will hold its value and likely appreciate.

Sorry but I think that's wrong and that you're looking at it the wrong way. You're right, no one is buying Type 1 photos of Ruth because it reminds them of being a kid. But how many people bought a Type 1 Ruth photo before they bought a pack of baseball cards? I would, again, just a guess, feel confident in saying almost no one.

[Exhibitman]

Pointless to try and predict the future.

Collect what you like and can afford

Drool over what you like and cannot afford

Shine the rest

[joshuanip]

I would say that demographic fear is probably priced in to some degree. But there will always be a market. Stamps, toys, etc. But who knows. Here is my bullish view:

The availability to sell online provided liquidity and reduced transaction costs (no longer selling at a dealer haircut like the 80's and 90's, and having visibility in real time price discovery). The grading from TPAs, has created fungibility in cards, providing further transparency to "value".

All of these factors have aided the upward stability of card prices, along with macro factors like monetary liquidity from global QE, improving unemployment, and yes a rising stock market.

So I say there are many positive aspects of card collecting that makes it a fun asset diversification. And they are just plain kool to look at.

[Steve_NY]

I tend to agree with Adam, and have been telling collectors since 1976 "when they ask" to "buy what they like" because the chances of making huge gains quickly is often slim to none. On the contrary, I have bought collections and items during a day at a show, and broke them up later in the day and sold them for a large profit. But every sports card dealer has such stories.

I find three types of collectors:

1 -- those that buy what they like or collect

2 -- those that are just investors, and

3 -- a combination of 1 and 2.

I buy for resale and can spot a true #1, #2, or #3 immediately. But I also think that there will always be opportunity to make a killing if you pick the right items.

Look at "Black Panther" which has made over $1 billion; did comic book collectors know that there early Black Panther comics would ever be worth big bucks?

Collectors kept them, and now investors are jumping in.

It can happen when you least expect it.

Look what Shaq and Jordan and Gretzky did for their respective sports card collectors.

My 2 cents: Collect what you like, and hope to make a profit someday, if that day ever comes.

Steve

[samosa4u]

Originally Posted by Snapolit1

People aren't buying nice Ruth cards and Type 1 photos because it reminds them of being a kid. They are buying because they see the appreciation over time, have a lot of money to invest, and think why not plow a small amount into something cool like sports memorabilia.

Exactly. I also want to add something to this: look at the folks who spend crazy amounts of money on paintings - did they even care about art when they were younger? Did they go to museums? Take art courses while in school? No, no and no. As they got older, and their disposable income increased, they decided to just put that money into awesome things, like art.

[packs]

Originally Posted by samosa4u

Exactly. I also want to add something to this: look at the folks who spend crazy amounts of money on paintings - did they even care about art when they were younger? Did they go to museums? Take art courses while in school? No, no and no. As they got older, and their disposable income increased, they decided to just put that money into awesome things, like art.

Many people go to museums. In fact, I would bet it would be pretty difficult for you to find a single person who hasn't been to one. You can show almost anyone in the country a photo of the Mona Lisa and they'll know what it is. That could not be said for any baseball card. I also doubt anyone buys art just to spend money on something. It is true that people will invest in artwork, but at it's base level art has a utilitarian purpose that baseball cards never will.

[MVSNYC]

The cream will always rise. The best cards (or memorabilia) of the best players, will always be considered "blue chip" material, and will always be in demand. Obviously they'll be peaks & valleys, but the better/best items will hold their value.

In addition to vintage, I think this can/will hold true for more contemporary items, such as important game used bats (Jeter, Trout, etc), uniforms, and some very limited production cards.

[bnorth]

Originally Posted by packs

Over the next 20 to 30 years I think there will be a HUGE drop in prices for cards. When boomers die out and new buyers are scarce, you'll see lifetime collections go for a fraction of what they would today.

I agree that cards will take a dive in price but for completely different reasons. Between shill bidding, card doctors, and counterfeiting something is going to bring this hobby down.

I would love to know the % of T206's that have had nothing done to them, bet it is pretty low number. Would also like to know the % on "new" old cards in the hobby, bet that number would also surprise most.

To be fair I have been saying this for some time and it hasn't happened yet.

[joshuanip]

Originally Posted by bnorth

I agree that cards will take a dive in price but for completely different reasons. Between shill bidding, card doctors, and counterfeiting something is going to bring this hobby down.

I would love to know the % of T206's that have had nothing done to them, bet it is pretty low number. Would also like to know the % on "new" old cards in the hobby, bet that number would also surprise most.

To be fair I have been saying this for some time and it hasn't happened yet.

There will always be "authentication" issues like this, which is why TPGs are vital to this industry. There always is a side story to how much we can depend on TPGs, but that is a separate debate discussed earlier on this site.

That said, same can be said for artwork. When I was looking to add some cheap paintings to my walls, I was looking into the auctions. Above me, but you want a Jackson Pollock with high provenance, tens of millions. You want one where the auctioneer says they have no history and as is, couple grand...

[MW1]

I agree that cards will take a dive in price but for completely different reasons. Between shill bidding, card doctors, and counterfeiting something is going to bring this hobby down.

I would love to know the % of T206's that have had nothing done to them, bet it is pretty low number.

I see this argument from time to time on these forums and it just doesn't hold much water. I know of nearly a dozen different finds of original and extremely high-grade T206s. And I'm aware of collectors who still have large groups of high-grade, untouched T206s that have never been graded. One collector, in particular, has nearly 1000 of them that would fetch grades in the 7 to 9 range. Another hobbyist has a nearly complete T206 set that is also high grade and 100% original.

T206s were not produced in small quantities and some of them have survived the test of time quite well. With the exception of one or two pedigrees, the vast majority of high-grade T206s encapsulated by the major grading services are 100% legit. I've seen where they come from.

[MW1]

As long as the institution of sports exists, in this case, that of baseball, those items related to it, will have value to collectors.

Prices may fluctuate from time to time and some cards, particularly those that are modern that have manufactured scarcity, may lose a great deal of their value. Vintage cards and memorabilia, however, will always have a following. They are intrinsically linked to the sport of baseball itself, as modern players who excel will always be compared to and measured against the all-time greats of the game.

[LincolnVT]

Buy the best of the best and see an up-side and some financial gain in the long run...or...collect what you like, maybe see some financial gain and be happy in the long run. We're talking baseball cards here folks...America's Hobby...let's not make it only about the money. I've put some hard earned work dollars in to some pieces that I hope will appreciate in my lifetime or in my sons lifetime, but my 1988 ungraded Ken Griffey Jr. Vermont Mariners Minor League card is the only one on the mantle.

[LincolnVT]

Originally Posted by LincolnVT

Buy the best of the best and see an up-side and some financial gain in the long run...or...collect what you like, maybe see some financial gain and be happy in the long run. We're talking baseball cards here folks...America's Hobby...let's not make it only about the money. I've put some hard earned work dollars in to some pieces that I hope will appreciate in my lifetime or in my sons lifetime, but my 1988 ungraded Ken Griffey Jr. Vermont Mariners Minor League card is the only one on the mantle.

PS -- This was an invitation to pick a debate with me about my choice to collect and financially invest in baseball cards.

[clydepepper]

Originally Posted by packs

Over the next 20 to 30 years I think there will be a HUGE drop in prices for cards. When boomers die out and new buyers are scarce, you'll see lifetime collections go for a fraction of what they would today.

I could give a rat's rear. I plan to be out-of-here by then.

[T206Collector]

There are some amazing 1926 Cricketeer cards from England on eBay for ridiculously cheap:

https://www.ebay.com/itm/Luddington-....c100752.m1982

I sometimes get concerned when I think about what it would take for baseball cards to turn into cricket cards over the next 100 years. English cricket was popular enough at one time to spark a marketing campaign based on cigarette inserts, which based on this sale made its way all the way to Australia (does anyone collect T206 cards in Australia?).

And what about the T205, er... T80 Military set, referenced in another thread today? Why are these cards so cheap but we lionize baseball men? Is there a surge in military cards coming in the future? Just as beautiful as the T205 set (which is not a compliment from me, but you get the gist).

https://www.ebay.com/itm/1910-T80-To...kAAOSwVL1WB45f

But, then I remember what John Maynard Keynes said: "In the long run we are all dead."