Mass Delusion and Comic Collecting?

[SquareChaos]

That is, if you believe the spoon that comes from Matt Taibbi.

 

Read the article and tell me what you don't like about it.

 

It's pretty detailed so unless he fabricated most of it (which would mean a lawsuit by some of the biggest bank and rating agencies in the world) there must be some truth to it.

 

@ Dav - trust me, it's worth the read. It's an easy to understand expose on how the entire financial crisis came to happen in 2008.

 

His articles are actually pretty informative, though they're written in a bit of an inflammatory style so as to interest.... Rolling Stones readers? I guess?

[Hamlet]

I'm not sure I would be super-confident that the Euro survives. As far as currencies go, it is an extremely questionable creation.

 

A currency has trouble when some areas where it is used have inflation and need the Central bank to tighten, while others have deflation and need the Central bank to loosen (ie "print money"). The Eurozone is in that situation now, and it is creating a whole lot of misery in Spain, Portugal, Italy, and Greece. I've actually been stunned that there hasn't been more dramatic actions taken by those countries.

 

Things that a currency area need are--

 

Labor mobility

Capital mobility

A way to redistribute money to troubled areas from booming ones. (ie, taxes from TX bailout CA during a housing crisis, and taxes from CA bailout TX during an oil collapse)

 

Here is a Wiki entry that discusses this--

 

http://en.wikipedia.org/wiki/Optimum_currency_area

 

I think the jury is still out on the long-term viability of the Eurozone. However, it has had surprising resiliency in the current adversity, so who knows.

 

That said, I don't think a breakup of the Euro would be the end of the world. Currencies fail periodically. New ones get used.

 

 

As to currencies collapsing in 5 to 10 years; well, people have predicted that since central banks were first created and, in particular to the U.S., since Nixon got rid of the gold standard. It has not happened and the odds of it happening in the next 5 to 10 years are almost non-existent barring a nuclear war or alien invasion. Even if Greece bails from the Euro it would only cause a small hiccup for the rest of the Eurozone. The Euro will not fail over Greece.

[VintageComics]

I'm not sure I would be super-confident that the Euro survives. As far as currencies go, it is an extremely questionable creation.

 

It sure is.

 

There is zero mobility when you yoke 28 countries together as they all want something different. Stalemate. So the stronger countries end up carrying the weaker ones.

 

That's why some countries didn't join.

[RockMyAmadeus]

We tried that game plan in 1930s. I much prefer how this is playing out to how it played out then.

 

 

A lot of people think that they should have let whomever was failing to fail and then rebuild rather than bail out a failing business only to increase the odds the next time the cycle comes around.

 

You can't prevent the natural order of things but you can artificially delay them sometimes. When you do, it just eventually gets worse, not better IMO.

 

Ehhhh....not really.

 

It's a lot more complicated than that, and had far more to do with Hoover, and then Roosevelt's, economic policies, but it's on the path.

 

There's a reason they're called the Roaring 20's, and a significant part of it had to do with Calvin Coolidge, who gets very, very little credit for anything.

 

Hoover was a disaster, and Roosevelt added water to a magnesium fire.

[SquareChaos]

We tried that game plan in 1930s. I much prefer how this is playing out to how it played out then.

 

 

A lot of people think that they should have let whomever was failing to fail and then rebuild rather than bail out a failing business only to increase the odds the next time the cycle comes around.

 

You can't prevent the natural order of things but you can artificially delay them sometimes. When you do, it just eventually gets worse, not better IMO.

 

Ehhhh....not really.

 

It's a lot more complicated than that, and had far more to do with Hoover, and then Roosevelt's, economic policies, but it's on the path.

 

There's a reason they're called the Roaring 20's, and a significant part of it had to do with Calvin Coolidge, who gets very, very little credit for anything.

 

Hoover was a disaster, and Roosevelt added water to a magnesium fire.

 

There is an entire Wikipedia page devoted to the cause of the Great Depression.

 

While no one can say for certain exactly what the root cause was, almost all informed opinions (that I know of) on the topic agree that the response of the then current Fed greatly exacerbated the situation.

[dupont2005]

Yeah, I also see a lot of parallels with Beanie Baby craze and comic speculating/investing. And I'm not just talking moderns either. I don't think anything is a guaranteed safe investment. Not even an Action 1 CGC 9.8

 

I mean, that comic will always be a thing of value, but will it always be worth a FORTUNE? Right now it could buy you a couple mansions and a couple exotic sportscars to go in the garages.

 

I'm thinking, although the odds are probably slim, it could be more in the ballpark of buying someone a domestic luxury sedan some day, depending on where comics go, if people ever realize paying insane premiums for microscopic grade bumps is a bad idea, and if the intellectual property ever becomes unpopular (even more unpopular) in the future. I mean, for a couple decades you're probably safe enough that you won't lose your entire fortune, but your heirs? I'd say better off leaving them with a multimillion dollar diamond.

[delekkerste]

“Certainly the game is rigged. Don’t let that stop you; if you don’t bet, you can’t win.” - Lazarus Long

[Badger]

Yeah, I also see a lot of parallels with Beanie Baby craze and comic speculating/investing. And I'm not just talking moderns either. I don't think anything is a guaranteed safe investment. Not even an Action 1 CGC 9.8

 

I mean, that comic will always be a thing of value, but will it always be worth a FORTUNE? Right now it could buy you a couple mansions and a couple exotic sportscars to go in the garages.

 

I'm thinking, although the odds are probably slim, it could be more in the ballpark of buying someone a domestic luxury sedan some day, depending on where comics go, if people ever realize paying insane premiums for microscopic grade bumps is a bad idea, and if the intellectual property ever becomes unpopular (even more unpopular) in the future. I mean, for a couple decades you're probably safe enough that you won't lose your entire fortune, but your heirs? I'd say better off leaving them with a multimillion dollar diamond.

I see it like stamps: there will be times when the market slumps, and it may never recover to the previous highs, but comics will be worth money for as long as there is civilization. Comics are too ingrained in to many culture to just collapse over night. This was not true with Beanie babies or Puffkins or any of the other myriad stuffed cutesy toys. The manufacturer of Beanie babies manufactured a crash on its own terms, which is an amazing accomplishment, yet beanies are still sold today and there are some that still go for a few hundred dollars. I feel it can be claimed that marvel engineered, by accident, the collapse in the 90s yet here we are, 20 years later, in another boom cycle. Hell, the late 70s saw the almost complete collapse of the Marvel comic line. The cycle will continue indefinitely.

[RockMyAmadeus]

We tried that game plan in 1930s. I much prefer how this is playing out to how it played out then.

 

 

A lot of people think that they should have let whomever was failing to fail and then rebuild rather than bail out a failing business only to increase the odds the next time the cycle comes around.

 

You can't prevent the natural order of things but you can artificially delay them sometimes. When you do, it just eventually gets worse, not better IMO.

 

Ehhhh....not really.

 

It's a lot more complicated than that, and had far more to do with Hoover, and then Roosevelt's, economic policies, but it's on the path.

 

There's a reason they're called the Roaring 20's, and a significant part of it had to do with Calvin Coolidge, who gets very, very little credit for anything.

 

Hoover was a disaster, and Roosevelt added water to a magnesium fire.

 

There is an entire Wikipedia page devoted to the cause of the Great Depression.

 

While no one can say for certain exactly what the root cause was, almost all informed opinions (that I know of) on the topic agree that the response of the then current Fed greatly exacerbated the situation.

 

While I don't know if I would trust anything Wikipedia has to say about a disputed topic (that is, anyone with access to a computer; for example, it says "the Roaring 20's was a time of...excess"...which has no meaning. Excess what? Food? Production? Consumption? Money? Buying power? And who determines what is "excess"?)

 

But yes, the Fed's policies were, indeed, a disaster. They threw money into a yawning black pit from whence it would never return, instead of keeping that money in the hands of those who earned it, and were thus in a far better position to spend it wisely.

 

And of course, it wasn't the stock market crash of '29 that did the damage...by early 1930, the market had significantly recovered, and probably would have been fine, had it not been for the government's wild overreaction under Hoover, and then Roosevelt, who made it worse. Morgenthau, in 1939, was absolutely correct.

 

It was the long, slow slide of '31 and '32 that did the most damage., with one failure after another, dominoing all the way down to 1933...and staying there until the start of WWII.

 

Necessarily simplistic, or we could get off on a tangent that never ends.

 

 

[mysterio]

I did go out and buy the book. Looking forward to starting it in a bit.

I just ordered the book from Amazon because of this thread.

I love reading about bubbles, especially about hobby bubbles that popped.

Hopefully what I read from the book will be used to compare to the comics bubble we`re in currently with certain comics.

Man, I hope you guys weigh back in after reading it, and how it relates.

 

During the C2C interview he was asked about his next project and had no idea. The host pointed out it would have to top the high bar he set with the Beanie Baby book. I was screaming in my mind, "COMICS! Do COMICS, man!!"

 

Seriously, someone should point Zac Bissonnette at Comic Collecting. The auction houses, encapsulation, variants, all of it. The timing is perfect with all the Hollywood focus. And reading that Forbes article gives a sense that Halperin is probably just as interesting a character as Ty Warner was, if someone would drill down into that story. Hell, he'd find more interesting characters than he would know what to do with.

 

Just typing that got me hyped again. COMICS!, yes COMICS should be his next project. The perfect follow up project for the guy. Someone please TELL HIM!

 

I finished the book a couple of nights ago. It was pretty good, though I was hoping for more on the economics of the speculative bubble. The book was more of a biography of Ty Warner and the company, and while discussion of the mania was part of that I didn't feel like it was the focus of the book, at least not as much as it could have been. Still, I did feel like I got some new insights into the frenzy, and would recommend the book if you don't mind a fairly in depth look at Ty Warner's life along the way.

 

As for parallels between the current state of the comic market and beanie babies, I am seeing some. Others have parsed these situations in this thread better than I could, and correctly pointed out that beanie babies were all about the money that could be made with no nostalgic connection to the product itself. Obviously the situation with comics is different, to an extent, in that at least some of the buyers have some nostalgia for the product. That being said, I do see the current spiraling of values on movie books as a parallel, as many folks who are buying these are doing so primarily to flip. The flood of variants in moderns is similar. The only reason for the huge numbers of variants is for multiple purchases that ultimately drive a flipper market. People "investing" in these variants aren't doing so for the love of a story or a character. They're either an obsessive collector who needs to have them all, or a flipper hoping to cater to that market and do so before the price drops. And while I don't see the comic market going the way of the beanie baby market, as there is nostalgia to provide a floor, I am still convinced that we have a bubble in at least these two segments of the market.