Gatsby77

But few are so openly transparent in the ways they're blatantly manipulating the market and ripping off their clients at the same time. Their blatant chutzpah is almost elegant, actually. And the sad thing is, it will work -- until it doesn't. To quote Hemingway, "How did you go bankrupt? Two ways. Gradually, then suddenly."

Highlighting this again, because there's poetry in its simple truth.

Key paragraph: "Liquidity is a concern. The value of the cars must rise faster than the expenses associated with owning them if the company is to make money. And since there is no third-party exchange platform, Rally Rd. could potentially be setting its own sell price—as opposed to a liquid market, where you would get the price that someone on the other side of the trade is willing to pay."

Exactly - it's been going on for decades. But what happens when Rally Rd. starts reporting to GPA? What's the book worth? Captain America # 3 in CGC 5.0 value: $28,000. Captain America # 3 in CGC 5.0 (securitized via 1,000 shares): $37,000. Captain America # 3 (individual slabbed pages, aka 3% shares - as available now via Lone Star or eBay): $375 - $3,250, depending on the page desired.

Holy S&$*% This screams sketchiness. Not just "market manipulation" but potential "securities fraud." I usually take anything Chuck Rozanski says with a barrel of salt, but this whole scenario brings to mind his old Tales from the Database essay "Fooling Bob Overstreet, and Other Fun Games.": https://www.milehighcomics.com/tales/cbg81.html "The thing to realize here is that Bob Overstreet does not sell any comic books. He compiles sales data that he receives from comics dealers. That makes him a prime target for all sorts of efforts to raise the values of certain genres. The simplest trick is for two dealers to "sell" each other books at inflated values. Let's say that dealer #1 has an ACTION #1 that hasn't been moving, while dealer #2 has a set of Captain America #1-#10 that he hasn't turned over in a while. Each dealer writes the other dealer a check for $200,000, and they swap inventory. The checks cancel each other out, but now each can report that they "sold" those books for record prices. This happens far more frequently than you would think..." Again, business model is simple: Have Metro sell some dead inventory at top market value to Rally Rd. Rally Rd. then flips the book for 20-30% more a few weeks later, while ensuring an artificially high share price by holding back 20% (or more - likely 50%+) of the shares for themselves -- and with only 500, not 1,000 shares actually on the market, you ensure a quick sell-out. And we don't know what additional shares (if any) are also held by Metro itself. Later accept a "sales offer" (to yourself) for double book value, that profits the individual shareholders and makes headlines, but in effect allows you to purchase the full asset for yourself at just 60% of market value, while booking an "official" sale for 2x market value - thus helping increase the overall "value" (or perception of value) of the underlying asset. Where does it fall apart? Eventually you'll run out of suckers willing to pay for a CGC 5.0 Captain America # 3 at a $37,000 valuation when they realize the true value of the book is ~$28,000.

I dunno man. So far it seems like a decent way for Metro to move dead inventory quickly at top dollar. Wonder how much they’re involved in the back-end, either via shares or as silent partner guarantors.

Except, we know the factual value of that book is less than $37,000. It's *never* sold for $37,000 in that grade and the last sale of a comp (another cgc 5.0 copy) sold two weeks ago for less than $24,000 all-in. As G.A.tor noted twice in the Golden Age thread on this topic, this type of trading won't really affect the *actual* value of the books.

Enjoy burning your 20%-40%. Money is money. Hell, I'd rather have 100% of a Bloodshot vol. 5 # 1 carbon fiber solid adamantium alloy variant than buy into anything at that mark-up.

A Venom ETF! I *love* it. Incidentally, when I had to sell off 90% of my collection back in 2014, there were only four books I knew I'd never own again - that even if I *could* afford them, I'd never be willing to buy them at current market prices. Whereas books like ASM 129, Avengers 1, X-Men 1, etc. are easy to buy at any time. Showcase # 4 TMNT # 1 Strange Tales # 110 Venom # 1 (black) Strange Tales 110 is more readily available than those other books, I just refuse to pay post-movie prices for it. But I miss all of them.

Holy s*$*#_. Scratch what I just posted. You don't actually own or have any claim to the underlying asset? This screams money laundering - they can not only manipulate the share price (either directly, or by holding an undisclosed controlling interest for all-but the two days surrounding the required quarterly reporting period; they can effectively shift funds from one asset to another to obscure any "real-world" valuation losses (or *gains*) that would normally affect the share price (not just among the comics, but rare baseball cards, cars, comics, etc.).

That's not how a ponzi scheme works, Greg and you know it. Here's the ponzi aspect: The very first time one of these books happens to fall in value below the IPO price, there will be a run on shares. If they haven't actually sold the book yet, they'll literally have to pay out with profits (or money from) from shares of other books. Paying out older investors with money from new investors is the literal definition of a ponzi scheme. But it's worse than that, because the 20-40% mark-up is baked into the IPO price. The real-world value of the book (say, Captain America 3) doesn't have to fall below the IPO price, it just needs to not sell for 30% *above* the IPO price for 2-3 years. You've bought in at Captain America # 3, CGC 5.0 at a $37,000 valuation? Well, last GPA sale (two weeks ago) was for just $23,400. Say the next sale - 9 months from now is for $30,000 - you're still underwater and folks will sell their shares at a loss. But Rally refuses to sell the book, and can't find new suckers willing to buy those shares at the still-inflated price. They *have* to pay out of proceeds from the CGC 9.0 Daredevil 1 purchase to cover, or (more likely) proceeds from some rare car that's appreciated, etc. Again, the endgame here is their model only works if they continually convince new people to buy in at 20-40% over FMV. And that's not sustainable in the long term.

I'd go with "ponzi" scheme rather than pyramid, but yeah. And the interesting thing about ponzi schemes is that people will both continue to buy into them *and* profit from them even if they know it's a ponzi scheme, because they work beautifully as long as you're not the very last out.

Glad to see most folks think this as dumb an idea today as it was 18 months ago.

This. And it's why I don't buy @valiantman's argument that owning a piece of a AAA comic book key for more than market value is cool. At that point, you might as well straight own stock in Marvel via Disney. Separated from the intrinsic value and joy of owning the comic book itself, it's just an investment vehicle, and there are *far* better ones out there.

Incredibly easy, if, for instance, Rally Rd. retains even say 30% of the shares.

None of this is as solid an investment plan as Comic Book Coin...backed by Avengers Annual # 7. Hell yeah! (Still one of the best threads here ever):

Sure. But don't kid yourselves - Heritage waives the seller's premium more often than you'd think, particularly when the book lends significant advertising value to their auctions. Think Batman 1s, Action 7s, McFarlane covers, and yes - potentially even 9.8 TMNT 1s. And yes - the combined buyer's and seller's premiums is why, while I've spent thousands at Heritage, I've only sold through Comiclink - and that includes when I sold my copy of TMNT # 1. It also frightens me because, while I've yet to try to sell any of my original art, I feel like for decent pieces Heritage is really the only viable outlet for sellers - and you take an immediate ~30% haircut.

Thank god! Can't wait to see what my books are worth

Bagley earned my respect when he penciled Ult. Spider-Man for more than 110+ consecutive issues. That book, and the new interpretation of all the Spidey villains and supporting cast, *was* him. He can't be ignored in the pantheon of Spidey artists. Granted, this was all 2000-2010, and a bit more evolved from his '90s work on ASM.

Thank you! This was a fascinating read. And largely validates my view that this Rally Rd. comic-book-shares venture will essentially need to become a ponzi scheme to survive. As I noted in the other thread, its business model seems contingent on a continual parade of suckers willing to pay 20-40% more for shares than the underlying asset is worth. Also - one thing that distinguishes this venture from Mr. Lheritier's is we have access to both GPA and Rally Rd.'s original purchase price of their comics - thus there's *far* greater price transparency for slabbed comics than rare manuscripts, art, etc.

This list is totally invalid because it totally ignores the second half of the run. Literally no artist on his list did appreciable work on ASM after issue 400 - in other words, it excludes literally every Spidey artist of the last 20+ years.

Larsen's only "bad" in the respect that immediately followed McFarlane. Today, I like Larsen and Bagley's art a lot more than most of the artists in the 200s.

? Heritage commissions are 35% now? Last I checked they were ~half that.

I misread the filing. They bought it from Vincent on March 16, securing it with only a $7,100 deposit...with the balance of $28,400 due within a week of the "IPO" on May 15. Clever. And...I haven't quite wrapped my mind around it yet, but seems like a good avenue for money laundering too.

Fascinating. So they bought it for $35,000 from Metro/ComicConnect, and immediately sold it for $37,000. But...only put down $7,100. So when did the IPO occur? Presumably within the 7-day period before they owed Vincent the balance?