CBS MarketWatch: Collectibles Are "The Stupid Investment Of The Week"

[Aman619]

I agree with the Spidey 121 artwork being a silly 'investment' at anywhere near those numbers. I think only one or two pages would be worth anything and paying through the nose for the other 18 would be a waste. And to even compare this issue with a 9.4 Action 31 or the AF#15 artwork is ludicrous. Those are already mythic totems of our culture... this is a far more recent adventure where a now long gone and someday forgotten character died.

 

anyway.... Im intrigued by your point about impending boomer retirements affecting values.

 

Do you have any insight or facts about how baseball cards have fared as their generation has faced retirement? To me, since the 50s Topps cards are the SA AND GA of card collecting, and they are loved and hoarded/collected/invested by the oldest of the Boomers who will be retiring first...do you see them starting to line up at the exits, preparing to sell off their collections???

[delekkerste]

Do you have any insight or facts about how baseball cards have fared as their generation has faced retirement?

 

I don't follow that market anymore, but I think some others have posted that cards had their own bubble in the '90s which has subsequently deflated (though when I occasionally look at that market, I still see lots of ludicrous prices, particularly on ultra high grade specimens from the past 20 years).

 

I would think, though, that a large number of all collectibles, including sports cards, will be sold out of collections after 2010. And, I think as time goes on that the players depicted on 1950s and 1960s cards may not hold their current popularity as we get farther and farther removed from the group of collectors who actually were around to see these players or heard stories about them from their fathers and grandfathers. Sure, some players' popularity will hold up for generations to come, but many of those still remembered and highly regarded today will likely fall by the wayside.

 

 

And to even compare this issue with a 9.4 Action #1 or the AF#15 artwork is ludicrous. Those are already mythic totems of our culture... this is a far more recent adventure where a now long gone and someday forgotten character died.

 

I was speaking only of my own feelings and personal preference...sure, Action #1 and AF #15 are infinitely more important books in the history of comics, but to me, ASM #121 is such a great tragic story that evokes much more emotion for me than any any other book with the possible exception of DD #181. For me, monetary value aside, there is no comic-related collectible that I would rather have than the original artwork to either of these books.

 

Gene

[fantastic_four]

It's probably too late. I think he's destined to see the inside of a bankruptcy court later in life.

 

I dunno, with the amount of research and exaggeration he put into selling a VG Spidey 129, he might be destined to send a lot of OTHER people to bankruptcy court later in life

[delekkerste]

I dunno, with the amount of research and exaggeration he put into selling a VG Spidey 129, he might be destined to send a lot of OTHER people to bankruptcy court later in life

 

Or maybe he's destined to see the inside of a jail cell later in life?

 

Gene

[fantastic_four]

Do you have any insight or facts about how baseball cards have fared as their generation has faced retirement?

 

I don't follow that market anymore, but I think some others have posted that cards had their own bubble in the '90s which has subsequently deflated (though when I occasionally look at that market, I still see lots of ludicrous prices, particularly on ultra high grade specimens from the past 20 years).

 

I'm still highly interested in researching this topic myself, or reading someone else's research on it. In bringing the topic up with various comic dealers/collectors over the last few months, I've heard anecdotes about the stamp hobby "bottoming out" and then coming back at least 5 times over the last century. A card dealer at a con today told me the card industry fell around 1994 and that it has now come back almost to what it was prior to that.

 

I'd love to see the research carried all the way back to that famous story Neil Gaiman told about 18th century tulip collectors in that speech back when Marvel was cranking out all the glitzy variant and holofoil covers to crash the new comics market. You can probably take that research even farther back into history...surely affluent Egyptians, Greeks, and Romans from those ancient civilizations blew their disposble income on useless crapola just like we do!

[Zonker]

18th century tulip collectors

 

Extraordinary Popular Delusions and the Madness of Crowds

 

Tulip Mania got a lot of press over the last 3 years as the fore-runner of the dot.com bust.

 

 

[delekkerste]

I've heard anecdotes about the stamp hobby "bottoming out" and then coming back at least 5 times over the last century.

 

That may be so, but nowadays, the hobby is in a terminal, secular decline. Here's some nice anecdotal evidence to that effect:

 

 

Faltering interest licks stamp-collecting club

By JOSEPH DEINLEIN

Times Herald, October 25, 2003

 

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

 

 

By J. DOUGLAS BROOKS, Times Herald

FADING PHILATELY: Roy Nowak of Fort Gratiot has had a lifetime of enjoyment collecting and showing his stamp collection. He is president of the Port Huron-Sarnia Stamp Club, which is disbanding in November due to a lack of membership.

 

When the Port Huron-Sarnia Stamp Club met the first time, mail was far from electronic.

 

Sixty-eight years later, e-mail and new technology have led to the club's disbanding, members said.

 

"Things have to come to an end some time," club President Roy Nowak of Fort Gratiot said.

 

"There's no enthusiasm about stamps. No youngsters are interested."

 

The club's last business meeting will be Nov. 19 at St. Clair County Community College in Port Huron. What money is left in the treasury will be used for a Christmas party in December, Nowak, 71, said.

 

Club members voted to disband after the number of active members dwindled from more than 100 in the 1960s to fewer than 20 today.

 

Rarely are there more than six people at a meeting, said Nowak, who joined the club in 1966.

 

Vice President Jim Biskner, 65, of Fort Gratiot, who has been a member of the club for 18 years, said it's rough to see the club go.

 

"It will be a sad ending," he said.

 

Especially with its beginning. As the name implies, the group stretched the border until Sarnia formed its own club in the mid-1900s.

 

And with its founding date of 1935, the Port Huron club could be one of the oldest local stamp clubs in America, Biskner said.

 

The Postal Service doesn't keep track of stamp clubs, so it's hard to verify, said Shannon Labruyere, spokeswoman for the U.S. Postal Service.

 

"They very well could be," Labruyere said. "How cool is that."

 

It isn't surprising Port Huron's club is disbanding, she said. The hobby is dying out around the country and only wealthy people are able to keep up with collecting new stamps.

 

"It's just the nature of the hobby," Labruyere said. "It doesn't play really well in the video age. It's slow moving."

 

Nowak agreed. Most members are older than 65, he said.

 

"It's a passive type of hobby," he said. "They're interested in computer games now."

[Darthdiesel]

Or maybe he's destined to see the inside of a jail cell later in life?

 

Gene

 

 

looking at society and parenting now, I'd say that fate holds true for about 80% of the children today...

[fantastic_four]

I can't decide whether that article supports the fact that people don't join special-interest clubs anymore or that people don't collect stamps. Chat rooms and Internet message forums have eliminated the majority of in-person forums joined by people under 40 these days. I do find stamps--and coins--to be much more boring than collecting comics...they seem so much more simplistic as collectibles.

 

I wonder how the stamp market itself is doing...e-mail is diminishing interest in stamps in a similar way that animated and interactive media is diminishing interest in comics.

[fantastic_four]

For lack of a better source for information about the stamp market, here are the total number of auctions currently on ebay for a few collectible areas:

 

• Comics = 158,756
• Stamps = 194,164
• Coins = 200,825
• Beany babies = 51,140
• Sports cards = 434,043
• Bottles = 17,780
• Lamps (I've met a few older women who collect these) = 17,784
• Dolls and bears = 247,572

Can't tell much from that about stamps versus comics except that it appears stamps are "dead" yet.

[delekkerste]

I can't decide whether that article supports the fact that people don't join special-interest clubs anymore or that people don't collect stamps.

 

Both. Notice how most of the remaining members of this group are over 65. Fast forward 30-40 years and that'll be us. In addition, not only are stamp collecting clubs disappearing, but stamp dealers and stamp conventions have all but vanished. We may take that for granted now, but it was not always the case.

 

By the way, "Tulip Mania" was a 17th-century phenomenon, not an 18th-century one. It coincided with the height of Dutch civilization and economic prosperity. Is it a coincidence that, as in Holland in the twilight of its own glory days, U.S. asset markets (stocks, real estate, collectibles) have become so prone to speculative manias triggered by backwards-staring masses trying to make a quick buck by capitalizing on past money-making trends?

 

Gene

[THE_BEYONDER]

... this is a far more recent adventure where a now long gone and someday forgotten character died.

 

GWEN STACY

will never be forgotten.....

[THE_BEYONDER]

[delekkerste]

I think any investors looking at the road ahead instead of in the rear-view mirror should be trying to figure out how to profit from mega-trends like the emergence of China as the world's next superpower or the re-opening of markets in places like Cuba or the fallout in the U.S. once the Baby Boomers retire or the demographic time bomb in Japan and Europe, etc. I don't claim to have all the answers, but I am metaphysically certain that there's orders of magnitude more opportunity in catching "the next big trend" than trying to make serious money in high grade comics or original art after prices have already appreciated literally thousands and even tens of thousands of percentage points over the past 10-15 years.

 

I think those of us who were too young, too poor or too stupid (note: I was all of the above) not to buy the best high grade comics and key art pieces out there in the '70s, '80s and early '90s need to face reality and stop hoping history repeats itself. Those people asking, "what comic will be the next Hulk 181" should know that, in all likelihood, the answer is there will be no more Hulk 181s unless current prices crash and you can pick stuff up at a fraction of today's prices. If you want to make serious money, start a business, go to Harvard Business School, marry rich, pray and play the Lotto and/or find some undiscovered stock or property, because it really is too late to do it in comics.

 

If overvaluation wasn't enough, think about this:

 

1. The pool of comic collectors and readers is shrinking, slowly but surely, over time.

2. The next generation of collectors will not have had the benefit of making tons of money in the heady markets of the '80s and '90s.

3. Tons of supply from aging/retiring/dying existing collectors will hit the market starting in 5-10 years.

4. Consumer debt levels are at unsustainably high levels.

5. Jobs, even white collar ones now, are fleeing the U.S. for China, India and Eastern Europe. Expect real incomes for the next generation of American workers to actually fall from today's levels.

6. Interest rates are at generational lows and will eventually rise, making the opportunity cost of holding non-income producing investments greater and thus depressing prices.

7. It is extremely unlikely that comic-based movies will be as popular even 5 years from now as they have been the past few years.

 

With this kind of macroeconomic environment and demographic/cultural trends in place, I find it extremely hard to believe that high-grade comics at today's levels will rise by even the mid-to-high single digit percentages over the coming decades that some people think. Remember, even at an 8% annual rise, prices double every 9 years - is that going to happen if real wages are stagnant or even falling?

 

Gene

[ubiquiti]

I think any investors looking at the road ahead instead of in the rear-view mirror should be trying to figure out how to profit from mega-trends like the emergence of China as the world's next superpower or the re-opening of markets in places like Cuba or the fallout in the U.S. once the Baby Boomers retire or the demographic time bomb in Japan and Europe, etc. I don't claim to have all the answers, but I am metaphysically certain that there's orders of magnitude more opportunity in catching "the next big trend" than trying to make serious money in high grade comics or original art after prices have already appreciated literally thousands and even tens of thousands of percentage points over the past 10-15 years.

 

I think those of us who were too young, too poor or too stupid (note: I was all of the above) not to buy the best high grade comics and key art pieces out there in the '70s, '80s and early '90s need to face reality and stop hoping history repeats itself. Those people asking, "what comic will be the next Hulk 181" should know that, in all likelihood, the answer is there will be no more Hulk 181s unless current prices crash and you can pick stuff up at a fraction of today's prices. If you want to make serious money, start a business, go to Harvard Business School, marry rich, pray and play the Lotto and/or find some undiscovered stock or property, because it really is too late to do it in comics.

 

If overvaluation wasn't enough, think about this:

 

1. The pool of comic collectors and readers is shrinking, slowly but surely, over time.

2. The next generation of collectors will not have had the benefit of making tons of money in the heady markets of the '80s and '90s.

3. Tons of supply from aging/retiring/dying existing collectors will hit the market starting in 5-10 years.

4. Consumer debt levels are at unsustainably high levels.

5. Jobs, even white collar ones now, are fleeing the U.S. for China, India and Eastern Europe. Expect real incomes for the next generation of American workers to actually fall from today's levels.

6. Interest rates are at generational lows and will eventually rise, making the opportunity cost of holding non-income producing investments greater and thus depressing prices.

7. It is extremely unlikely that comic-based movies will be as popular even 5 years from now as they have been the past few years.

 

With this kind of macroeconomic environment and demographic/cultural trends in place, I find it extremely hard to believe that high-grade comics at today's levels will rise by even the mid-to-high single digit percentages over the coming decades that some people think. Remember, even at an 8% annual rise, prices double every 9 years - is that going to happen if real wages are stagnant or even falling?

 

Gene

.....and with that...I am selling off all my high grade comics, replacing them with reader copies, and taking the difference and buying gold.

That is the hard thing with comics. I buy comics because I like them, but being honest with myself, I also know I am kinda looking down the road thinking I am going to make a return on what I bought the comics for, as I'm sure many people either consciously, or subconsciously do. The problem is - I am emotionally attached to them, so I would probably never really sell a lot of them.

As a gambler will tell you - never get emotional, same with comics...Unless you really are in it 100% for the pure enjoyment of collecting comics(I doubt there are many purists liek that - maybe Joe C)

[buena_vista]

I think any investors looking at the road ahead instead of in the rear-view mirror should be trying to figure out how to profit from mega-trends like the emergence of China as the world's next superpower or the re-opening of markets in places like Cuba or the fallout in the U.S. once the Baby Boomers retire or the demographic time bomb in Japan and Europe, etc. I don't claim to have all the answers, but I am metaphysically certain that there's orders of magnitude more opportunity in catching "the next big trend" than trying to make serious money in high grade comics or original art after prices have already appreciated literally thousands and even tens of thousands of percentage points over the past 10-15 years.

 

I think those of us who were too young, too poor or too stupid (note: I was all of the above) not to buy the best high grade comics and key art pieces out there in the '70s, '80s and early '90s need to face reality and stop hoping history repeats itself. Those people asking, "what comic will be the next Hulk 181" should know that, in all likelihood, the answer is there will be no more Hulk 181s unless current prices crash and you can pick stuff up at a fraction of today's prices. If you want to make serious money, start a business, go to Harvard Business School, marry rich, pray and play the Lotto and/or find some undiscovered stock or property, because it really is too late to do it in comics.

 

If overvaluation wasn't enough, think about this:

 

1. The pool of comic collectors and readers is shrinking, slowly but surely, over time.

2. The next generation of collectors will not have had the benefit of making tons of money in the heady markets of the '80s and '90s.

3. Tons of supply from aging/retiring/dying existing collectors will hit the market starting in 5-10 years.

4. Consumer debt levels are at unsustainably high levels.

5. Jobs, even white collar ones now, are fleeing the U.S. for China, India and Eastern Europe. Expect real incomes for the next generation of American workers to actually fall from today's levels.

6. Interest rates are at generational lows and will eventually rise, making the opportunity cost of holding non-income producing investments greater and thus depressing prices.

7. It is extremely unlikely that comic-based movies will be as popular even 5 years from now as they have been the past few years.

 

With this kind of macroeconomic environment and demographic/cultural trends in place, I find it extremely hard to believe that high-grade comics at today's levels will rise by even the mid-to-high single digit percentages over the coming decades that some people think. Remember, even at an 8% annual rise, prices double every 9 years - is that going to happen if real wages are stagnant or even falling?

 

Gene

 

Gene, some of your points are valid while others are not.

 

1. To say that prices double every nine year is a finacial misconseption. To the contrary, prices have dropped relatively to average income in the US over the past 5 years according to the Wall Street Journal.

 

2. " Tons of supply from aging/retiring/dying existing collectors will hit the market starting in 5-10 years." -- but we've already been through that stage, haven't we? I consider myself part of the 3rd or 4th generation of comic collectors being in my mid 30's. What about the golden age folks? They've been retired, aging and dying for a while -and that market is stronger than ever.

 

3. "Consumer debt levels are at unsustainably high levels." -- what's the point of this statement? If they continue to be high, then collectables will be part of the spending functions. But even when there was less consumer debt, there were still plenty of people buying back issues. The same can be said regarding the interest level arguement. Those were actually very high during the late 80's & 90's and look what happened then.

 

4. "It is extremely unlikely that comic-based movies will be as popular even 5 years from now as they have been the past few years." Now that's just impossible to predict. I think that Hollywood is desperate for the next blockbuster. They need good ideas to help their severely slumping industry. Did you know that the profit off of video games is higher than that of Hollywood? The more they develop the technology to make fantasy characters real, the more comic movies we'll see. I predict the opposite of what you do.

 

Having said all that, I agree with your the bottom line.Comics are not a good place to be making your primary income unless you have the speed and liquidity to do so. There are fewer readers and collectors out there and the future of comics as an investment is very questionable. I also agree with you regarding the high grade bubble, although I'm not too sure about original art -- one of a kinds can be pretty nice for the die hards....

[towards2112]

Best thread in months.

 

[delekkerste]

Gene, some of your points are valid while others are not.

 

I maintain that all of my points are valid:

 

1. To say that prices double every nine year is a finacial misconseption. To the contrary, prices have dropped relatively to average income in the US over the past 5 years according to the Wall Street Journal.

 

I'm not sure what this is supposed to mean. I meant mathematically, prices double every 9 years at an 8% CAGR, as per the Rule of 72. I was not referring to any specific historical trends in inflation, income or anything else.

 

 

I consider myself part of the 3rd or 4th generation of comic collectors being in my mid 30's. What about the golden age folks? They've been retired, aging and dying for a while -and that market is stronger than ever.

 

Most people who bought comics in the 1930s, 1940s and 1950s were not collectors, certainly not in the sense we define the word today. I don't consider the comic collecting hobby to really have gained traction until the 1970s with the emergence of Overstreet, comic cons and later in the decade the direct sales system and the introduction of storage materials like mylars. So no, I don't consider you to be part of the 4th generation of collectors and no, most GA collectors have not retired or died off yet.

 

 

If they continue to be high, then collectables will be part of the spending functions. But even when there was less consumer debt, there were still plenty of people buying back issues. The same can be said regarding the interest level arguement. Those were actually very high during the late 80's & 90's and look what happened then.

 

Too much debt = reduced spending. Just ask the CEO of Wal-Mart who recently voiced his concerns. As for high-interest rates not affecting prices in the 1980s and 1990s, you had the greatest creation of wealth in recorded history, a secular, demographics-driven boom in comic prices (Baby Boomers coming into money and buying collectibles & other nostalgia items) and consumers embarking on a decade-long borrowing and spending binge, all of which countered the effect of high interest rates. Also, interest rates don't matter as much when you're buying a book for $200 in 1990. They start to matter when that $200 item now costs $20,000 in 2003 and you're already in debt up to your eyeballs with no savings to speak of like many Americans.

 

 

4. "It is extremely unlikely that comic-based movies will be as popular even 5 years from now as they have been the past few years." Now that's just impossible to predict.

 

No, it's impossible to predict with certainty, but it's not impossible to predict in all probability. I won't rehash the arguments that Joe_Collector and others have made in this regard, but suffice to say, if history is any guide, Hollywood will go overboard and the fad will eventually burn itself out. 5 years is probably enough time to do that, 10 years with almost absolute certainty.

 

 

Having said all that, I agree with your the bottom line.Comics are not a good place to be making your primary income unless you have the speed and liquidity to do so. There are fewer readers and collectors out there and the future of comics as an investment is very questionable.

 

At last, something we can both agree on.

 

Gene

[THE_BEYONDER]

if history is any guide, Hollywood will go overboard and the fad will eventually burn itself out. 5 years is probably enough time to do that, 10 years with almost absolute certainty.

 

Hmm.....

 

What year did the 1st SUPERMAN movie come out?

[Rocketeer]

There was a serial in 1948 and 1950

pilot for tv show 1953

and the chris reeve version 1978