If a crash does come....will anyone hear it in the forest?

[drbanner]

[joe_collector]

Over the kicking and the screaming and the punching and the pinching and the yelling and the....

 

Highly doubtful.

[drbanner]

Over the kicking and the screaming and the punching and the pinching and the yelling and the....

 

Highly doubtful.

 

I agree (for a change)! There's gonna be quite a fight for to buy those books for pennies on the dollar after the crash...of course that will cause prices to rise...

[blowout]

crash no crash crash no crash

[richnerd]

 

So did you hear the crash??

[uluru]

[Bonds25]

If the comics crashed in the forest and no one was there, would the trees still stand?

[delekkerste]

Re: If a crash does come....will anyone hear it in the forest?

 

Very clever, DrBanner, but not clever enough! Here's the real question/issue: in the physical sciences (like chemistry), when an experiment is conducted/observed correctly, the scientist does not affect the outcome. However, in the social sciences (where I would include this little bit of forecasting about the future of comic prices), the economist or forecaster can influence what happens in the future merely by discussing it and interacting within his/her environment (like this Board).

 

Perhaps by our actively discussing and debating the possibility of an upcoming crash/correction/etc., people will actually change their attitudes and behavior, thus averting the crash or perhaps lessening its severity. I think it's unlikely, but if my forecasts do not come to fruition or to a lesser extent than I have predicted, I'll claim partial credit for having knocked enough sense into enough people to keep the mania in check.

 

Gene

[localshop]

 

Gene,

 

Well done on the Arse' going through!

 

Andy

[drbanner]

Perhaps by our actively discussing and debating the possibility of an upcoming crash/correction/etc., people will actually change their attitudes and behavior, thus averting the crash or perhaps lessening its severity.

 

Actually, I think the opposite would be the affect of all the crash discussion (self-fulfilling prophecy). However, since the market crash has been the #1 topic here for the last year and a half, it obviously hasn't been too influential. I guess we'll know by the end of '04 since that's the timetable given to the sheep for their doom...so we'll have to check back in about 381 days for the accuracy of the prediction!!

[joe_collector]

Perhaps by our actively discussing and debating the possibility of an upcoming crash/correction/etc., people will actually change their attitudes and behavior, thus averting the crash or perhaps lessening its severity.

 

I was thinking the same thing; kinda like a guy who sees the future and runs around telling people about it, hoping the disaster is averted. This is the most logical assumption, as playing the Bull and predicting double-digit profits for the next few decades would only jack the market higher.

 

And maybe this is like a Twighlight Zone episode, where it would have been far better just to let nature take its course.

[joe_collector]

Actually, I think the opposite would be the affect of all the crash discussion (self-fulfilling prophecy).

 

Actually, that's the opposite to the human condition, and Gene may be onto something.

 

Okay folks, no more crash threads!!

[Aces]

Now I know why I wading through all these damn posts today.

How much spamming about the comic market crashing is enough.

 

"Crash" should now be a filtered word... %^*&$#@! or whatever...

[JLA_ALL_THE_WAY]

And the back-pedaling has begun.

[NoImSpartacus]

Hello,

I just got done moving so Its been a while since posting. I couldnt let this one go buy without chiming in. I dont think there is going to be a crash at this point. I am seeing what appears to be the beginnings of nice prosperity coming somewhat like that of the Reagan administration years back. I deal in real Samurai swords and medals as well as comics. Years ago during the Reagan years one could not put a sword or medal, dagger, comic or whatever on your dealer table before it would sell so fast. One would take the profits and go buy more only to find as soon as more was put on your table to sell, they would be sold again quite fast. I had never raked in so much profit from the years of 1982 to 1989. It was fantastic. I am seeing the beginnings of this again and it looks like we are at the start of it right now. Economy turning, tax breaks, etc.etc. and much more. Money is going to start flowing more freely. Granted, the nuts who paid into wacky 9.4 or 9.8 multiples are going to feel it but those that are conservative can expect nice return and profits. I also believe that there is going to be a real nice flow of buying a selling because the money will be there. It looks like the start of the Reagan years are here again. All the signs are there and I see it happening at my shows. Anyway, it appears to me that its the start of this cycle now. What seems to be happening now is just like 1982 / 83. My samurai swords and medals are starting to disappear from the tables again over these past 6 months and its getting better. The timing looks right. People say that money flows away from collectibles and into the stock market when they believe they can get better return. I would believe this is true but when the money and profits are flowing it means more money for me to invest or buy myself some nice books. One just feeds the other. Anyone agree/disagree??

 

 

[delekkerste]

What seems to be happening now is just like 1982 / 83. Anyone agree/disagree??

 

I cannot stress how much I disagree with this comment. In 1982, the stock market was trading at absurdly low valuations and interest rates were still quite high. The dollar was strong and would get stronger up through the Plaza Accord of around 1985. The savings rate was in the high single digit percentages or low double digit percentages - people were not up to their eyeballs in debt like they are today. U.S. businesses were just about to break out of their malaise of the 1970s. Real estate prices were cheap. Commodities were at the beginning of a 20-year disinflationary cycle. Taxes were on the verge of being lowered and deregulation for many industries was on the horizon, as was the IT revolution. Collectibles prices, though they benefitted from the inflationary 1970s, were still extremely low by today's prices adjusted for inflation. The Baby Boomers were just then embarking on making fabulous sums of money and many had not reached their peak nostalgia/spending years yet.

 

In sum, I see almost ZERO similarities with 1982 today. I think there is virtually a ZERO chance that we will see an economic expansion and bull market like we saw in the Reagan years. People are older and saddled with debt. The savings rate is practically zero. The dollar is weak and getting weaker as commodity prices soar in dollar terms. Interest rates have only one direction to go in the long-term. The federal trade & budget deficits are out of control - globalization has depressed wages, job growth, profit margins and ballooned the trade deficit. The U.S. is starting to engage in protectionist measures, which threaten a dollar collapse if foreign central banks stop financing our current account deficit with U.S. Treasury bond purchases. States like California are practically bankrupt. The Baby Boomers are getting closer to retirement. Comic and real estate prices are now expensive vis-a-vis virtually every consumer good in the market as their prices have soared while prices on many items have grown slowly over time or even declined.

 

We are in a far, far different place now than in 1982. Sure, the current upturn in the markets and economy makes it feel like good times are here again and we are definitely seeing some money flowing into both the stock market and the comic market. However, the fundamentals that I have described above bode ill for a protracted and robust economic expansion (and, by consequence, bode ill for the future of collectibles prices).

 

Gene

[NoImSpartacus]

However, the fundamentals that I have described above bode ill for a protracted and robust economic expansion (and, by consequence, bode ill for the future of collectibles prices).

 

Gene,

When you say "bode ill for the future of collectibles prices. How far out are we talking in long term before you feel collectible prices will wane. Are we taking , 3, 4, 5 or more years or do you feel this wane will be within a year or two or less? Ah, a fellow wall street effectionado.

I am a firm believer regarding the comic market in what Herr Gekko once said "The illusion has become real". When the illusion goes away, so do the prices. This 9.4/ 9.8 stuff is just that. The other comic areas seem to be doing well, as are coins, gold, militaria, samurai swords, autographs, etc. How long do you think before it dies.

I sometimes wonder if "Illusion" weights in more than anything else. All that is needed is the publicity and marketing to get the "tulips selling" and prices skyrocketing before some sucker gets caught at the top. Even during bad economic times certain categories get run up such as the collectible paper money market which skyrocked a few years back under a terrible economy. Again, that illusion of undervalue perpetuated within a collectibles market. How long do you feel we have till confidence is lost and the investors pull out?

Jeff

[delekkerste]

Jeff,

 

All very good questions. I have never claimed to have a perfect crystal ball, but neither do I believe the future is entirely unpredictable (an excuse used by many to justify buying, holding and buying some more). I look at the future as a series of probabilities. I do believe a severe correction in comic prices is inevitable given the demographic, cultural, technological and economic changes we've seen and will see going forward. Objectively speaking, the hobby is in a long-term decline, though it has stabilized somewhat over the past 3 years.

 

My view is this: I don't know when the steep part of the correction will occur. But I think it is inevitable, so we can look at the future as a cumulative probability function. What is the % chance of a steep correction in 2004? Let's call it 30%. By 2005? Let's say 40%. By 2006? Let's say 50%. And so on and so forth, reaching a nearly 100% chance, in my view, by the end of the decade or early next, by which time I believe the country will be or will have already experienced a huge debt crisis and by which time the first Baby Boomers will have started retiring and selling off their collectibles and other holdings to fund their retirements.

 

My view is that the risks are weighted to sooner than that, though, given that much of the market has already corrected (large swaths of the Bronze & Modern market, for example) and that I doubt prices on keys and pre-65 SA can continue their rapid ascent with debt levels so high and income growth so low. Sure, consumers have piled on debt like mad since the early 1980s and have made do, but I truly think we are near an inflection point, the point at which debt can no longer be sustained. This probably would have happened sooner if not for the stock & real estate bubbles. I think this mass exportation of jobs overseas is the last straw - our economy is just not growing fast enough to support the financial leverage in the system, IMO.

 

I truly believe that collectibles prices are way out of wack with reality. Just started doing a little holiday shopping this past week and EVERY consumer good looks cheap compared to high grade CGC books. I want to get an electric scooter so I can zip around NYC...the cost? $300-$400 will get you an awesome one. You can't even buy a Batman #234 CGC 9.4 for $400. Look at the price of consumer technology goods - the price of everything is dirt cheap and falling all the time. My Pentax Optio S digital camera is now only $289.99 on Amazon, $100 less than a few months ago. What grade Marvel Spotlight #5 does $289.99 buy you these days?

 

Gene

[Aman619]

jeeez, Spartcus, whys you have to come back jjst at this moment???

 

Gene was just backpedalling his dire forcasts for the CRASH a few posts ago (AMAZINGLY!!) and now you got him back to his testbook theories, and posts with "8x10 glossies with circles and arrows and a paragraph on the back of each one" and everything all over again!

 

We're all just trying to collect our comics here, and get along, w/o grandstanders either trying to protect us from the impending CRASH (and ourselves); or preparing to gloat when it happens; or strangely, trying to actually take credit for AVERTING it by doing the latter two!!!

 

Cmon, Gene...please! lighten up... (again)

[delekkerste]

 

Is that light enough for ya?

 

Gene