Collectors Universe releases fourth quarter and fiscal year end earnings today

[Peter_Spaeth]

Sean as you seem knowledgeable in this area, how concerned are you that we are close to the point where people can create counterfeits that at least current review techniques won't be able to distinguish?

[steve B]

Originally Posted by Peter_Spaeth

Sean as you seem knowledgeable in this area, how concerned are you that we are close to the point where people can create counterfeits that at least current review techniques won't be able to distinguish?

In my opinion that point was met in maybe 1981-2.
The local dealer I hung out at showed me an extremely nice 51B Mantle. After holding it for a couple minutes I handed it back saying "It's really nice, and fake. But I can't explain why"
They said that was the opinion of 5-6 other dealers, who had also passed on buying it. (Yes, at the time occasionally a card like that would get shopped around by mail!) Everyone thought it was fake but couldn't explain why it was fake. Somehow it just "felt " wrong.

I 100% believe that card would pass TPG today and would grade very high, at least an 8. For all I know it is in a holder today. The guys I knew passed on buying it, and I never heard about it again.

[Peter_Spaeth]

https://seekingalpha.com/article/428...int-grade?dr=1

Collectors Universe Will Escape Latest 'Scandal' With Near Mint Grade

I respect the fact collectors are concerned about the trimmed/altered cards, and several investors called into Collectors Universe’s Q4 conference call to ask about the impact it has on the business.

But after examining the company’s Q4 numbers - talking about trimmed cards is akin to asking a batter why he struck out in the 4th after hitting home runs in every other at bat!

[Peter_Spaeth]

THIS.

Additionally, given there are few alternatives for collectors to turn to for grading trading cards - it’s not like collectors can change grading company’s like consumers can do in more competitive industries.

[Peter_Spaeth]

Heh.

From the analyst call. Re Mark's question, this is how you (potentially, if it later turns out the warranty reserve was inadequate) commit securities fraud.

"In terms of our warranty, we take a very conservative view in terms of warranty and what our expectation is, in terms of our balance sheet. So I think this whole trimming issue that we spent a lot of time talking about today is really something that we don't consider material to our business."

If I were on the CU Board I would be cringing at unqualified statements like that, just saying.

[WhenItWasAHobby]

My limited observations from the Blowout Forum is that tally of discovered doctored cards is ever increasing at a still alarming rate and the cumulative damages are far from trivial. It would be very informative if they had a spreadsheet compiling of all of their findings and see what we're talking about in terms of the sum total of final prices of doctored cards discovered. I'm guessing we're talking about multiple millions dollars which is well above their warranty limits which is not only for cards but also for coins.

Also, a CEO of a publicly traded company has a fiduciary duty towards it's shareholders which includes loyalty, good faith and fair dealing and exercising candor on material company matters. Orlando's responses and actions during that analyst meeting may warrant some serious scrutiny regarding his duties.

I also find it rather amusing that card submissions have been on the increase the last several years. Maybe everyone and their brother wants to make big money doctoring cards while the market is still hot.

[T_Hamilton]

Originally Posted by WhenItWasAHobby

My limited observations from the Blowout Forum is that tally of discovered doctored cards is ever increasing at a still alarming rate and the cumulative damages are far from trivial. It would be very informative if they had a spreadsheet compiling of all of their findings and see what we're talking about in terms of the sum total of final prices of doctored cards discovered. I'm guessing we're talking about multiple millions dollars which is well above their warranty limits which is not only for cards but also for coins.

Also, a CEO of a publicly traded company has a fiduciary duty towards it's shareholders which includes loyalty, good faith and fair dealing and exercising candor on material company matters. Orlando's responses and actions during that analyst meeting may warrant some serious scrutiny regarding his duties.

I also find it rather amusing that card submissions have been on the increase the last several years. Maybe everyone and their brother wants to make big money doctoring cards while the market is still hot.

Logical next step is to get in the Boards ear...
http://investors.collectors.com/board-directors

[barrysloate]

As Corey has said many times, it is not PSA who determines the value of cards, it's the potential buyer. If a new grading service is able to determine that cards previously holdered were altered, the next buyer will decide what he is willing to pay. Maybe PSA will do nothing and never admit they made any mistakes, but that doesn't prevent a future buyer from rejecting any or every card he deems problematic.

It will entirely be market based. The TPG opinion will be meaningless.

Of course, what will happen if somebody develops a new technology that can detect tampering is that people with a vested interest in PSA cards will forcefully demean and reject the findings of the new company. They will state that the new technology is flawed and can't be trusted. They'll find a couple of mistakes the new company made and say that their grades are no more reliable than the old ones, and that they shouldn't be trusted.

[swarmee]

I'm guessing we're talking about multiple millions dollars which is well above their warranty limits which is not only for cards but also for coins.

https://www.blowoutforums.com/showpo...postcount=5032
That's up to Page 200 or so of just that Mantle thread, not including Robert Block or the most recent HawkDynasty exposure thread.

[drcy]

Good point about older altered cards that got past. I assume they would easily be identified under close inspection.

I don't know the grading process, but, from what I hear, many cards are examined in seconds by graders. So, even if they have the abilities and capabilities, they go too fast to apply them properly. As noted often times, many of the BO altered cards clearly don't make size specifications.