Owning a King's Ransom in Art and Living Like a Pauper

[delekkerste]

 

I would give up comics and art long before I gave up TV. I don't think print and online media are enough to really be informed and feel connected socially, at least not given where I live and what I do for a living. Of course, it's essential for sporting events and it's not like there aren't any good shows out there either.

[delekkerste]

I would venture to guess that most "serious" art collectors, you know who you are, have to have between 10-30 percent of thier liquid assets in art.

 

I wonder what the range of percentages are...10-30% probably captures a lot of collectors but I suspect there are more than a few with the majority of their net worth in art and collectibles. I certainly know some comic collectors who fit that description. I also think there are a lot of people who, like Bronty, are more comfortable with tangible assets than the stock market - I know a lot of foreigners in particular who have this mentality so perhaps there is a cultural component to it (though, their investment of choice has been real estate for the most part).

[pinupcartoonguy]

But see, you're making the assumpting that most collecters are treating their collections like an asset. I don't think this is the case. While most are aware of the value of their art, I think most collectors don't intent to sell much of their art, which is why you find people who live paupers but own thousands upon thousands in art carefully stored in milars and portfolios.

[Bronty]

at some price level though it becomes impossible to ignore the fact that it is a significant asset, whether you want to sell it or not.

[pinupcartoonguy]

Is it really an asset if you're living in a box eating cat food?

[DarkKnightReturns]

Is it really an asset if you're living in a box eating cat food?

 

cat food

[Bronty]

I would venture to guess that most "serious" art collectors, you know who you are, have to have between 10-30 percent of thier liquid assets in art.

 

I wonder what the range of percentages are...10-30% probably captures a lot of collectors but I suspect there are more than a few with the majority of their net worth in art and collectibles.

 

That's fair comment... I bet the spread is as wide as can be, 10 - 90%. Part of it will depend on age too.

 

Taking myself as an example. Like lots of people, I pay my mortgage, and contribute to my rrsp (IRA equivalent - which isn't in stocks, natch every month ). Equity builds there over time. Meanwhile I'm married and we're planning a family and any "new" collectibles spending stopped years ago (purchases are fuelled by sales). So my own % is decreasing over time as equity builds in the home and rrsp while collectibles spending has been cut off. At least in theory. In practice the mortgage builds equity slowly in the early years while the collectables values have shot up. But that should reverse itself over time.

[Bronty]

Is it really an asset if you're living in a box eating cat food?

 

Yes. By that logic a $10m stock portfolio wouldn't be an asset either if one lived frugally. An asset is an asset is an asset. Its money, something that produces money, or something that can be sold for money. Regardless of how you live.

[AvengersFan]

It is something to think about nowadays. I think hard assets like precious metals, real estate, collectables may be a safer (?) or at least less volatile way to protect your capital than the stock market. Bronty might be right. Watching the stock market gyrate back and forth is like watching a war going on. Even cash seems risky if inflation starts to spiral as many big names predict may happen. I guess it still comes down to being diversified with your eggs spread out into many baskets. Of course its also nice to have a safe/recession proof job you can count on. This sort of mentality also helps me justify spending more cash on comic art because, you know, I like to buy comic art, and it helps me diversify my holdings. Heh.

[comix4fun]

I would venture to guess that most "serious" art collectors, you know who you are, have to have between 10-30 percent of thier liquid assets in art.

 

I wonder what the range of percentages are...10-30% probably captures a lot of collectors but I suspect there are more than a few with the majority of their net worth in art and collectibles. I certainly know some comic collectors who fit that description. I also think there are a lot of people who, like Bronty, are more comfortable with tangible assets than the stock market - I know a lot of foreigners in particular who have this mentality so perhaps there is a cultural component to it (though, their investment of choice has been real estate for the most part).

 

 

I have to agree with this, but it's possibly true that it's NOT because most of their money is spent on collectibles.

 

10 years ago my collection was a tiny portion of my net worth, but with the escalation of thousands of percentage points over that time in art and comics and collectibles, combined with the decline of real estate and stock values recently it's possible that lots of folks who have been collecting for more than 5 years fall into that realm even if they don't spend drastic amounts of new money on their collections.

 

I, for one, have traded and sold pieces over the years to buy new pieces. I have "dollar cost averaged" myself down to a point where my collection has not cost me very much at all out of pocket but it's overall value has jumped significantly.

 

Even though it's not an investment for me, and I am happy that my overall outlay averaged over the years is extremely small, I can see how lots of folks are in the same boat.

 

C

[Bronty]

Exactly! That's what I was getting at in my post too. Spent a large chunk of money on a down payment only to see it pretty much vanish with real estate prices taking a hit. Meanwhile the collection has done great... so without putting a single new dime into the collection the last few years my percentage has stayed at least stable and that's without even having money in stocks (and the resulting hit there the last while).

[delekkerste]

I have to agree with this, but it's possibly true that it's NOT because most of their money is spent on collectibles.

 

10 years ago my collection was a tiny portion of my net worth, but with the escalation of thousands of percentage points over that time in art and comics and collectibles, combined with the decline of real estate and stock values recently it's possible that lots of folks who have been collecting for more than 5 years fall into that realm even if they don't spend drastic amounts of new money on their collections.

 

Very good point, Chris - I'm sure that a significant percentage of those who have an overweighted "allocation", as it were, to art/collectibles got there largely through price appreciation.

 

The question remains, though - we all know some people who have valuable art/collectibles collections but who do not have outsized incomes or live extravagantly. I can say flat-out - if I was one of those people who won the "OA lottery" and didn't have a lot of disposable income otherwise, I would sell off as much as I needed to improve my lifestyle. I know a lot of people who don't need/want nice clothes, meals, electronics, cars, vacations, homes, jewelry, etc. and/or who just love comics too much to ever make that trade-off. I am not one of those people, though.

 

Does anyone know somebody who has cashed in on their good fortune in the comics/OA market, sold off their collections and gone on to live the high life (or maybe used that money to make a significant purchase like a house, or start a new business or something like that)?

[Bronty]

well I guess gator sold his action 1-100 run years ago to start his business, which paid off for him. but for the most part no.... aardvark88 said it best. "What would I do with the money? Buy more comics? So what's the point?" A lot of people who get deep enough into it to have valuable collections just love collecting so selling seems pointless.

 

There is a price point at which I would sell everything off but my collection value has a ways to go before I would consider that seriously.

[comicartcom]

Does anyone know somebody who has cashed in on their good fortune in the comics/OA market, sold off their collections and gone on to live the high life (or maybe used that money to make a significant purchase like a house, or start a new business or something like that)?

 

when I moved out to Vegas in 1993 I stopped buying art for my collection which was massive huge. I sold from and lived on that collection for 10 years (and continue to) and from 1993 - 2000 I did almost no work at all, partied Vegas style, dated many many babes (I like c ocktail waitresses alot) and every last bit was paid for by my art collection, or poker winnings

 

Then I changed directions and started adding again to my movie poster collection and stopped selling comics & art for the most part while focusing on what eventually became my movie poster auction website where I have a weekly auction. For interested souls www.movieposterbid.com

 

Of course, the fact that buying art collections has become near impossible due to Heritage, fleaBay and the re-orientation from older material to Bronze and newer which I have never had any interest except for very small areas was a major factor in "moving on". But yes .. I lived the high life and paid for it with art.. What fun it was.

[delekkerste]

[Sharkey]

 

Does anyone know somebody who has cashed in on their good fortune in the comics/OA market, sold off their collections and gone on to live the high life (or maybe used that money to make a significant purchase like a house, or start a new business or something like that)?

 

Hi Gene,

 

When I was a graduate student I lived in a trailer park (seriously). I was definitely NOT living the "high life". At the time I had an impressive Silver Age collection and was a basement dealer (trailer park dealer? ) doing small local comic shows in the midwest on weekends to make ends meet. I'd say quite a bit of my net worth at the time was in comics (I did do some stock investing at the time, and used that to help pay my tuition bills). I often tell people that dealing comics and buying Wal-Mart stock helped me keep from taking out a single student loan, and that's the truth. Have I mentioned that I love Valiant???

 

Not long after, I was hired away to a new job in a new city and sold off a large piece of my personal Silver Age collection to put the downpayment on our first home (a townhouse). Several years after that we sold it and moved into a single-family home in a nice suburb (at times I admit I liked the trailer park better ) and I sold off another chunk of Silver Age and other comics to add to that downpayment.

 

So, dealing comics and selling most of my comic book collection certainly helped me improve my lifestyle, build my assets (home ownership), and keep out of debt.

 

Life is good. I guess I am now ex-trailer trash living the "high life". All thanks to your friendly neighborhood Spider-Man and his friends.....

(cue violins, *sniff*)

 

--Steve

 

[dem1138]

 

Does anyone know somebody who has cashed in on their good fortune in the comics/OA market, sold off their collections and gone on to live the high life (or maybe used that money to make a significant purchase like a house, or start a new business or something like that)?

 

Hi Gene,

 

When I was a graduate student I lived in a trailer park (seriously). I was definitely NOT living the "high life". At the time I had an impressive Silver Age collection and was a basement dealer (trailer park dealer? ) doing small local comic shows in the midwest on weekends to make ends meet. I'd say quite a bit of my net worth at the time was in comics (I did do some stock investing at the time, and used that to help pay my tuition bills). I often tell people that dealing comics and buying Wal-Mart stock helped me keep from taking out a single student loan, and that's the truth. Have I mentioned that I love Valiant???

 

Not long after, I was hired away to a new job in a new city and sold off a large piece of my personal Silver Age collection to put the downpayment on our first home (a townhouse). Several years after that we sold it and moved into a single-family home in a nice suburb (at times I admit I liked the trailer park better ) and I sold off another chunk of Silver Age and other comics to add to that downpayment.

 

So, dealing comics and selling most of my comic book collection certainly helped me improve my lifestyle, build my assets (home ownership), and keep out of debt.

 

Life is good. I guess I am now ex-trailer trash living the "high life". All thanks to your friendly neighborhood Spider-Man and his friends.....

(cue violins, *sniff*)

 

--Steve

 

Steve, you are my new hero. I can't wait to talk about this more with you in Chicago!

[tb]

I think the psychology of collecting is a very interesting and complex subject that is discussed far less frequently than it ought to be. The most eye opening reference I have seen is Nicholas Basbanes' "A Gentle Madness" and to a lesser extent "Patience and Fortitude".

 

To me, the fraction of your net worth that is made up of comics/OA is less interesting than the underlying reasons people spend what they do on comics. I know people who fit the description that delekkerste mentions. Some are very smart and successful bibliophiles who deliberately have chosen an alternative lifestyle that goes against the mainstream. The other extreme is bibliomania: "an obsessive-compulsive disorder involving the collecting of books to the point where social relations or health are damaged" (wikipedia). Most people who put a significant amount of their income into collectibles fit somewhere on this spectrum. Delekkerste's "pauper" is not a stereotype but rather a broad category of collectors. Some I admire, some I feel sorry for.

 

My own experience is that things start to get uncomfortable when collectors talk more about money and profits than they do about the actual collectibles. This has been a key factor that has eroded my own sense of bonding with the CGC board community in general: I see an awful lot of talk about money and blind admiration for people who are able to spend it. I think that is plain sad. The collectors that I have formed friendships with are all fairly rounded individuals who have successful careers and just happen to love comics and/or art as a fun hobby. A few of these people are "paupers" while most are "kings". Some are wealthy "paupers" and some are solid middle class income "kings". If anything, I respect the paupers more because they have had the courage and self-confidence to adopt a controversial lifestyle that makes them happy instead of being part in the consumer culture that all of us are taught is "nomal". On the other hand, I could never see myself enjoying any association with a bibliomaniac. If you have read "A Gentle Madness", you should know what I mean by this distinction.

 

Thanks for an interesting thread.

 

 

 

 

 

[comicartcom]

I think the psychology of collecting is a very interesting and complex subject that is discussed far less frequently than it ought to be. The most eye opening reference I have seen is Nicholas Basbanes' "A Gentle Madness" and to a lesser extent "Patience and Fortitude".

 

To me, the fraction of your net worth that is made up of comics/OA is less interesting than the underlying reasons people spend what they do on comics. I know people who fit the description that delekkerste mentions. Some are very smart and successful bibliophiles who deliberately have chosen an alternative lifestyle that goes against the mainstream. The other extreme is bibliomania: "an obsessive-compulsive disorder involving the collecting of books to the point where social relations or health are damaged" (wikipedia). Most people who put a significant amount of their income into collectibles fit somewhere on this spectrum. Delekkerste's "pauper" is not a stereotype but rather a broad category of collectors. Some I admire, some I feel sorry for.

 

My own experience is that things start to get uncomfortable when collectors talk more about money and profits than they do about the actual collectibles. This has been a key factor that has eroded my own sense of bonding with the CGC board community in general: I see an awful lot of talk about money and blind admiration for people who are able to spend it. I think that is plain sad. The collectors that I have formed friendships with are all fairly rounded individuals who have successful careers and just happen to love comics and/or art as a fun hobby. A few of these people are "paupers" while most are "kings". Some are wealthy "paupers" and some are solid middle class income "kings". If anything, I respect the paupers more because they have had the courage and self-confidence to adopt a controversial lifestyle that makes them happy instead of being part in the consumer culture that all of us are taught is "nomal". On the other hand, I could never see myself enjoying any association with a bibliomaniac. If you have read "A Gentle Madness", you should know what I mean by this distinction.

 

Thanks for an interesting thread.

 

this is really a wonderful post with well reasoned & educated information.

 

one thing I share with you is this part:

My own experience is that things start to get uncomfortable when collectors talk more about money and profits than they do about the actual collectibles. This has been a key factor that has eroded my own sense of bonding with the CGC board community in general: I see an awful lot of talk about money and blind admiration for people who are able to spend it. I think that is plain sad.

 

it is one of the leading factors for me having mostly left the comics/art hobby behind, and I used to be one o fthe biggest names in dealing. Thankfully I had other interests (posters) and I moved in that direction.

 

Oh Gene, I should have added something to my previous post... when I was having the party of my life from 1993-2003, most everyone thought I was nuts. Selling stuff to have fun!! If I hadn't spent the $$$ I made on selling my last 4 EC covers to Bechara on opening a gallery that I lost beaucoup bux on before I closed it 18 months later, I might still be partying hardy instead of running my weekly poster auctions and probably only be doing monthly auctions. Of course, I'll probably be retired and partying again in the not distant future, so I'm not complaining. I do like what I'm doing after all.

[tth2]

Does anyone know somebody who has cashed in on their good fortune in the comics/OA market, sold off their collections and gone on to live the high life (or maybe used that money to make a significant purchase like a house, or start a new business or something like that)?

I don't know about OA, but there just aren't very many comic collections worth enough to suddenly vault someone into the lifestyle of a Russian plutarch. Heritage has handled the sale of a few big OO collections in recent years, most notably the Davis Crippen books (although granted there didn't seem to be many major keys in there). What were the total proceeds of the Crippen books, $1-2 million? A nice windfall for his heirs, but not really a game-changer, particularly after taxes.

 

Even taking the Martignette collection as an example of one of the best collections of illustrated art, what are the total proceeds from everything that's sold so far, and how much more is left? Is it an amount that would really move the needle?