Various Killing Joke page prices...

[delekkerste]

You would've undoubtedly said the same thing in 1994, citing all the various developments that had happened in the period from 1974 to 1994 that had caused OA to be at their nosebleed 1994 prices, and why continued increases in prices at their then-current growth rates was unsustainable.

 

Yeah, he would have said that, and he would have been wrong, but at the same time, he has to be right sooner or later, no? The growth does have to slow down at some point and its reasonable to assume we are at that point for the great majority of comic OA. (that prices may increase... just slower).

 

Presumptuous much, guys?

 

It's impossible to say what anyone would have thought 20 years ago without being influenced by the benefit of hindsight. What we do know, though, is that the changes we saw between 1994 and 2014 were revolutionary compared to the gradual evolution of the hobby between 1974 and 1994. We know that the Internet was a total game-changer, not just for the OA market, but for numerous markets that had been heretofore illiquid, fragmented, etc. The OA market went from the Stone Age to the Space Age in the last 20 years, whereas the change from the previous 20 years before that was, at best, progressing from the Cro-Magnon Age to the Neanderthal Age.

 

You can't linearly extrapolate revolutionary change like that indefinitely into the future - you have to recognize it for what it was. Any change from these levels will be evolutionary. And, maybe appreciating beyond the rate of inflation for the next 20 years at a lower pace (a best case scenario in my view) will indeed make 2014 prices look cheap in 2034. Maybe. Or, maybe not. What I do know for certain, though, is that 2034 prices will not make 2014 prices seem anywhere nearly as cheap as 1994 prices do now to us, because we're starting from a much more advanced level of development in the hobby and we'll see the law of large numbers, mean reversion, etc. take hold in the form of, at the very least, lower growth rates. The kind of growth rates we'll see even in the best case scenario over the next 20 years will be a tiny fraction of what they were over the past two decades which saw many pieces rise 20, 50, 100, even hundreds of times over starting from a minuscule base, much like comparing the economic growth potential of an undeveloped economy to a developed one. Is there anyone here who disputes this?

 

As for the more general question of whether prices in 2034 will make today's seemingly high prices look cheap, that all depends on what stage of development you think this hobby is in and how you think things are likely to play out over the next 20 years. What I see Tim doing is extrapolating some version of the status quo over that time period, which means positive real (i.e., inflation-adjusted) rates of return compounded over the next two decades which will indeed make today's prices look cheap by comparison (though nowhere close to comparing 1994 prices vs. today's, not even remotely in the same ballpark either in terms of percentages or emotional shock value).

 

Personally, I do not believe over the long-term (20-30 years) that the next generation will have either the interest (with comics/OA competing for mindshare with thousands of other things in the Internet Age) or the resources to take over from Gen X at prevailing market prices, let alone much higher prices, and prices (not necessarily on everything, but on many things) will have to adjust downward to clear the market. This is not something you'll see change over the next year or two or even five to ten necessarily, but, at some point before 2034, I bet you'll see, at the very least, a sustained period of price stagnation kick in to make the real returns over the next 20 years, and definitely 30 years, mean revert to a much less impressive rate than we have become accustomed to. Linearly extrapolate at your own peril.

[delekkerste]

Here's something to think about:

 

Do you think interest rates in 2034 will be higher or lower than in 2014?

 

Do you think tax rates will be higher or lower?

 

Do you think the growth of the US economy over the next 20 years will be higher or lower?

 

Do you think the next generation will be better or worse of economically than ours?

 

Do you think the average return of the stock market will be higher or lower over the next 20 years as it was over the past 20?

 

Do you think superhero movies will be more or less popular in 2034 than they are in 2014?

 

Do you think comic book circulations will be higher or lower?

 

Do you think there will be more or less comic book collectors?

 

Do you think current 35-55 year olds who are doing most of the spending in the OA hobby these days will be spending more or less in 20 years when they are 55-75 years old? Could they even be net sellers, as a cohort, by that point?

 

Do you think that there will be enough Millennials coming into the hobby over the next 20 years to replace all those Gen Xers and Baby Boomers who grew up with comics before the Internet splintered peoples' interests in an infinite number of different directions? Even if there are, do you think they will have enough buying power to clear the market at prices much higher (in real terms) than today's as older collectors sell out?

 

While we may disagree about the answers to the above questions, I think the mere fact that the answers to these questions cannot be taken for granted as they might have been at other points in history should tell you how risky it is to linearly extrapolate the experience of the recent past indefinitely into the future.

[Bronty]

sure it was presumptuous but come on. We both know you're a bright guy but even you have to admit that you've had largely a bearish tone on comics and comic OA over the twelve years (wow time flies!) that we've known you. It's not such a reach to take twelve years of history and assume back another eight. In 1994 I don't think any of us would have seen the impact of cgc, the auction houses, Hollywood, GPA, the Internet, etc. the list of positive shocks for comics and OA over the last twenty years has been incredible when you consider how far in the dumps comics were in 1994. But, we would have ALL been wrong. A lot of rabbits have been pulled out if hats the last twenty years to the point where I don't see any rabbits left to be pulled. So I do agree with you in a broad based manner although some items will always do well and end up looking cheap.... and that's what will get talked about.

[delekkerste]

sure it was presumptuous but come on. We both know you're a bright guy but even you have to admit that you've had largely a bearish tone on comics and comic OA over the twelve years (wow time flies!) that we've known you.

 

Frankly, I don't agree with this characterization at all. Just because I have some cautious views about how the next 30 years will play out doesn't mean I've been hanging around for the past dozen years waiting for a crash to happen any day now (if anything, I've been consistently more aggressive with my valuation and price expectations for several years now compared to many of my close friends in the hobby). I was definitely wrong early on (2001-2003) about seeing a more generalized price decline in comics, but I admitted as much and largely quit playing that tune by 2004 (as I became super-bullish on stocks and commodities and made most of my fortune in the ensuing several years - permabear? Please). Of course I've voiced concerns, both short and long-term, from time to time since then, but to say that I've been some kind of perma-bear for the past 12 years is just totally off the mark and I think very colored by the 2001-2003 experience.

[comix4fun]

Here's something to think about:

 

Do you think interest rates in 2034 will be higher or lower than in 2014?

 

Do you think tax rates will be higher or lower?

 

Do you think the growth of the US economy over the next 20 years will be higher or lower?

 

Do you think the next generation will be better or worse of economically than ours?

 

Do you think the average return of the stock market will be higher or lower over the next 20 years as it was over the past 20?

 

Do you think superhero movies will be more or less popular in 2034 than they are in 2014?

 

Do you think comic book circulations will be higher or lower?

 

Do you think there will be more or less comic book collectors?

 

Do you think current 35-55 year olds who are doing most of the spending in the OA hobby these days will be spending more or less in 20 years when they are 55-75 years old? Could they even be net sellers, as a cohort, by that point?

 

Do you think that there will be enough Millennials coming into the hobby over the next 20 years to replace all those Gen Xers and Baby Boomers who grew up with comics before the Internet splintered peoples' interests in an infinite number of different directions? Even if there are, do you think they will have enough buying power to clear the market at prices much higher (in real terms) than today's as older collectors sell out?

 

While we may disagree about the answers to the above questions, I think the mere fact that the answers to these questions cannot be taken for granted as they might have been at other points in history should tell you how risky it is to linearly extrapolate the experience of the recent past indefinitely into the future.

 

 

I am stuck between two images for how this post made me feel....

 

 

This one:

 

 

 

 

and this one:

 

[Bronty]

sure it was presumptuous but come on. We both know you're a bright guy but even you have to admit that you've had largely a bearish tone on comics and comic OA over the twelve years (wow time flies!) that we've known you.

 

Frankly, I don't agree with this characterization at all. Just because I have some cautious views about how the next 30 years will play out doesn't mean I'm hanging around waiting for a crash to happen any day now (if anything, I've been consistently more aggressive with my valuation and price expectations for several years now compared to many of my close friends in the hobby). Even with comics, the stuff I was into (Bronze/Copper high grade 9.4s/9.6s) most definitely did crash last decade as Census numbers exploded and 9.8s became the new 9.4s/9.6s, and Action #1 9.0s aside, there are a lot of books (probably the majority by quantity if we're talking about the slabbed super-high grade market) that are past the peak prices they hit last decade. I was definitely wrong early on (2001-2003) about seeing a more generalized price decline in comics, but I admitted as much and largely quit playing that tune by 2004 (as I became super-bullish on stocks and commodities and made most of my fortune in the ensuing several years - permabear? Please). Not that I haven't voiced concerns, both short and long-term, from time to time since then, but to say that I've been some kind of perma-bear for the past 12 years is just totally off the mark and I think very colored by the 2001-2003 experience.

 

Perhaps you're right about that. I know you are able to make sound and well reasoned arguments as to why certain collectibles will fall. But I really don't recall you making any public proclamations about specific collectibles you expect to rise in the next, say twenty years. Pick a few things from comics, OA, or the wider swath if collectibles and tell us why you think they would do well? Id be genuinely interested to hear both the predictions and the reasons. If you're going to tell me that you can pick absolutely nothing out of the entire world of collectibles that has even a shot at doing well, then that will say something too.

[Overthetopinc]

Its alright...Just keep eating your shorts =)

[Bronty]

To put it another way, you've shared with us and I know Ive enjoyed, some high profile art days the last few years so it's fair to say that you haven't been bearish with your actions, but when it comes to prognostications that you've shared, they have been very bearish and that's not limited to 2002 to 2003.

 

But that's all history. Id love to hear about the comics, OA, or other items that you think will outperform in the next twenty

[Bronty]

Its alright...Just keep eating your shorts =)

 

Huh?

[Overthetopinc]

wasnt he the guy who was saying if so and so reached a certain amount at auction he would eat his shorts?

[delekkerste]

Perhaps you're right about that. I know you are able to make sound and well reasoned arguments as to why certain collectibles will fall. But I really don't recall you making any public proclamations about specific collectibles you expect to rise in the next, say twenty years. Pick a few things from comics, OA, or the wider swath if collectibles and tell us why you think they would do well? Id be genuinely interested to hear both the predictions and the reasons. If you're going to tell me that you can pick absolutely nothing out of the entire world of collectibles that has even a shot at doing well, then that will say something too.

 

I haven't made any public proclamations about specific collectibles that I think will do well over the next 20 years because (a) as I've said before, 6 years into a near-zero interest rate regime, everything is priced assuming that condition will last indefinitely (i.e., we've already borrowed a lot from future returns) and (b) I believe that the next generation will have fewer resources to spread out among a much larger number of competing interests, which doesn't bode well for many/most collectible hobbies in general. I think this will further be exacerbated by the fact that the new generation is growing up with so much virtual/digital/disposable media (e.g., digital comics instead of physical comics or digital music instead of records and CDs or e-books instead of textbooks at college) that the entire idea of collecting physical objects, especially paper goods, is being subtly devalued over time for them.

 

All I can say is that I have been very bullish on a great many things over the past dozen years (at various times: stocks, real estate, oil, gold, commodities, Ferrari F40s, contemporary art, sports teams, etc.), even if comics haven't generally been one of them. I'm sure I'll be bullish on a lot of other things over the next 20 years as well, even if the hobbies currently dominated by Gen X collectors aren't high on the list.

[delekkerste]

wasnt he the guy who was saying if so and so reached a certain amount at auction he would eat his shorts?

 

That was Simon, not me or Bronty.

[Bronty]

Perhaps you're right about that. I know you are able to make sound and well reasoned arguments as to why certain collectibles will fall. But I really don't recall you making any public proclamations about specific collectibles you expect to rise in the next, say twenty years. Pick a few things from comics, OA, or the wider swath if collectibles and tell us why you think they would do well? Id be genuinely interested to hear both the predictions and the reasons. If you're going to tell me that you can pick absolutely nothing out of the entire world of collectibles that has even a shot at doing well, then that will say something too.

 

I haven't made any public proclamations about specific collectibles that I think will do well over the next 20 years because (a) as I've said before, 6 years into a near-zero interest rate regime, everything is priced assuming that condition will last indefinitely (i.e., we've already borrowed a lot from future returns) and (b) I believe that the next generation will have fewer resources to spread out among a much larger number of competing interests, which doesn't bode well for many/most collectible hobbies in general. I think this will further be exacerbated by the fact that the new generation is growing up with so much virtual/digital/disposable media (e.g., digital comics instead of physical comics or digital music instead of records and CDs or e-books instead of textbooks at college) that the entire idea of collecting physical objects, especially paper goods, is being subtly devalued over time for them.

 

All I can say is that I have been very bullish on a great many things over the past dozen years (at various times: stocks, real estate, oil, gold, commodities, Ferrari F40s, contemporary art, sports teams, etc.), even if comics haven't generally been one of them. I'm sure I'll be bullish on a lot of other things over the next 20 years as well, even if the hobbies currently dominated by Gen X collectors aren't high on the list.

 

I'm sure you've been bullish on those other things but we just know you from what we read about here, and if you wonder why some characterize you as a perma bear well perhaps it's because you just described yourself as one, when it comes to collectibles at least.

 

[delekkerste]

To put it another way, you've shared with us and I know Ive enjoyed, some high profile art days the last few years so it's fair to say that you haven't been bearish with your actions, but when it comes to prognostications that you've shared, they have been very bearish and that's not limited to 2002 to 2003.

 

Again, not an accurate representation. "Very bearish" to me and most people means calling for a near-term price decline of some magnitude. I don't recall ever making a call for a near-term price decline in the post-2003 era and that is very much by conscious design. As for a decline of some magnitude, I have also consciously shied away from ever specifying such, especially since that is not what I believe. What I do believe is that we will see long-term mean reversion and probably a stagnation in real (inflation-adjusted) returns over the very long-term (20-30 years). You'll notice that this scenario even allows for nominal price increases - hardly sounding like a harbinger of doom here.

 

 

I'm sure you've been bullish on those other things but we just know you from what we read about here, and if you wonder why some characterize you as a perma bear well perhaps it's because you just described yourself as one, when it comes to collectibles at least.

 

Have to disagree with you...yet again. Just because I am cautious about how the next 30 years will play out doesn't mean that I am expecting a crash or am even bearish at all about the near-term. I think "not a long-term bull" (which says zero about how I feel about the short and intermediate-term) is much more accurate than saying that I am a "perma-bear", which implies that I am now and always expecting prices to fall.

[delekkerste]

To use a similar analogy, I am and have been fully invested in the stock market for some time now. I think it's fair to say that I am a "nervous bull", because I know prices are going up largely because of artificially suppressed interest rates which will eventually mean revert and trigger a repricing of all risk assets. I know we will eventually get a reckoning, but I don't know whether that will be in one month, one year or one decade from now. Does that make me a stock market bear? I'd say quite the contrary, at least in the near-term.

 

Similarly, just because I don't think most OA will offer great returns over the next 30 years doesn't mean that I see any reasons for prices to come down anytime soon. Does that make me a bear or perma-bear? Don't think so, even if some would like to paint that label on me for not drinking the long-term Kool-Aid.

 

Again, I think the facts speak for themselves, and all this he said/she said is just a sideshow. You can guess how I would answer the questions I posed above; I'd love to see how people who think the market will continue to go from strength to strength over the next 20 years would answer them. Because when you get beyond the lazy linear extrapolation and do the deep-dive into what's actually gotta happen to keep this locomotive steaming ahead for the next two decades, it's really far from flippin' obvious that this hobby will be in a much stronger place in 2034 than it is today.

[Bronty]

Honest question - does it ever occur to you that someone besides yourself might have a point once in a while? IMO a significant majority of the board would, if given a radio button poll on 'Gene's outlook: Bearish, bullish, or simply "not a long term bull'" would choose 'Bearish.' If that's not the way it is then either a majority of the board including myself and Tim are drooling cretins, or it's something in the way the message is coming across.

[RockMyAmadeus]

Honest question - does it ever occur to you that someone besides yourself might have a point once in a while? IMO a significant majority of the board would, if given a radio button poll on 'Gene's outlook: Bearish, bullish, or simply "not a long term bull'" would choose 'Bearish.' If that's not the way it is then either a majority of the board including myself and Tim are drooling cretins, or it's something in the way the message is coming across.

 

[RockMyAmadeus]

I remember seeing a pair of killing joke pages online priced at 4 or 6k in 2001.

 

I think remember those, too.

 

I definitely I remember the last two pages of DD #168 on eBay for $10k.

 

[Jesusjon]

Man I have not been around as long as some of you guys, but in person Gene just strikes me as an enthusiastic fan and collector of this stuff who brings a reasoned perspective to where it's all headed. I mean look at the joy of his recent art day. It's about the love.

 

I think he can be described as a "bear" only because the hobby as a whole is SO BULLISH on the future. I would put him right in the middle.

 

And the hobby is so bullish because it comforts us all to think of our spending as being as close to risk free as possible. We gotta justify it or it's too scary. But as any investor should know, this stuff carries risk.

 

My .02.

 

[Bronty]

I like and respect Gene, don't get me wrong. But when asked to name one. single. collectible. that *might* have a good return - one comic, one page, one anything - he can't or won't do it. Seemingly ever. I don't personally view that as a balanced perspective or at least balanced posting. I'm sure he's wonderful and enthusiastic about art - he'd have to be to be on here for so long - and I have no doubt AT ALL that he's a wonderful guy. People I respect have told me that. My past interactions with him have told me that. Zero doubt in my mind. So, I'm probably just being a pr!ck at this point but its annoying being told you're flat wrong many times in a row *while being told he's not a bear despite being unwilling to venture to name a single positive prognostication about a. single. collectible *anything* that might outpace the macro concerns based on its individual merits.

 

Since turnabout is fair play I will offer up that I see quality TMNT art being currently repriced and I see the trend on that continuing for a while. Its a somewhat younger franchise, the art has been cheap until now, and Nickelodeon bought the property for 60m a while back so there is zero chance of the property fading into obscurity any time soon. Eastman's been feeding the market a lot of stuff the last couple years but at some point that will dry up and there is no reason to believe Laird is going to sell any with the 60m he has in his pocket. I like the long term outlook on it relative to most other comic OA.

 

I see no reason why pages bought at 10 and 15k very recently can't be 50k in ten years or less. Am I saying it will happen for sure, of course not, but I think its got a pretty good shot at it. I wasn't a huge fan of the TMNT 1 4th print cover that sold for 13k what like 6 months ago? a year?, but wouldn't be surprised if it was worth 50k in five years, or ten. That's a good return for whoever bought that page or others like it. There were some 'return to new york' pages on ebay very recently in the 2k range and I don't see any reason why those couldn't enjoy the same type of percentage gains also (or more).