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Purchasing less due to poor stock market results
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93 posts in this topic

On 9/18/2022 at 8:36 PM, delekkerste said:

Do I think the OA market will crash soon? No. Do I think that that prices will flatten out in light of the bigger macro picture? Very in the coming months IMO

Was the point of my post. Most people who can afford pieces upward of $10K probably have that money tied up in the market and sell when required to meet larger financial obligations. With the market falling from (using SP500 here) 4818 to below 3900 currently, there is a lot less money out there -- and the outlook is even more dire for the next few weeks. I am sure I am not the only one throttling back purchasing right now... and a lot of this might turn down the heat on the OA market in the short term.

Edited by KirbyCollector
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On 9/17/2022 at 9:26 AM, tth2 said:

I was going to diversify into sports cards and sports memorabilia until I heard that they were already crashing. 

But then I read that a Mickey Mantle card just went for $12.6m and 2 Justin Herbert cards went for over $1m each, and a Michael Jordan jersey went for over $10m, soon after a Diego Maradona jersey went for over $9m.  If that's a crash, I'd hate to see what they were going for before!

So now I'm just very confused.

Pre 1960 HOF Sports cards in 6 or better and hold    

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On 9/18/2022 at 6:46 PM, KirbyCollector said:

Most people who can afford pieces upward of $10K probably have that money tied up in the market and sell when required to meet larger financial obligations. 

I don’t know about ‘most’. I’d think people regularly dropping 10k+ on pieces have more revenue streams than just the stock market. Prices didn’t drop or flatten at the start of the pandemic when the market tanked, and I don’t see it happening now. If anything, people caught flat footed two years ago should be much better prepared this go round with the amount of warning everyone’s had. But who knows. I think it’s more likely that all this prime material that’s been seeing light will slow - so even if there’s less funds for purchases, it’ll at best be a wash with less supply. I’d love to be wrong tho and get more for my money. 

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On 9/19/2022 at 7:50 AM, delekkerste said:

we know that the lockdown dynamic very rapidly spurred a huge societal shift into goods vs. services since everyone was locked down at home with nothing else to spend their money on, and unprecedented monetary and fiscal stimulus threw gasoline on the fire.

This... people forget everyone had more money because they weren't spending it on gas to commute... weren't buying new clothes for work... weren't traveling on vacation or visiting relatives...  on and on. The other big factor was Bitcoin going from 6K in March 2020 to 60K a year later, and some profits from this trade did flow into OA buying.

In regard to whether the projected yeild on quality OA is better than that of a CD, yes, it is (and it definitely beats the yeild on QQQ this year, too, as the Nas is down 27%). I agree OA is not as safe as a CD, but then again nothing is unless you stash the cash under your bed.

Edited by KirbyCollector
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On 9/19/2022 at 8:48 AM, KirbyCollector said:

This... people forget everyone had more money because they weren't spending it on gas to commute... weren't buying new clothes for work... weren't traveling on vacation or visiting relatives...  on and on. The other big factor was Bitcoin going from 6K in March 2020 to 60K a year later, and some profits from this trade did flow into OA buying.

In regard to whether the projected yeild on quality OA is better than that of a CD, yes, it is (and it definitely beats the yeild on QQQ this year, too, as the Nas is down 27%). I agree OA is not as safe as a CD, but then again nothing is unless you stash the cash under your bed.

I don't think that people have forgotten. 

Personally, I don't have to go into the office for at least another 6 months and I continue to save on vehicle expenses (gas, insurance, wear & tear, regularly scheduled Maintenace, etc), clothing & dry cleaning, laundry and so forth.  I've been travelling only within North America, albeit very short, low-cost trips (HeroesCon and Terrificon).  Only went to the movies once to see Top Gun 2 - Maverick, and I was able to negotiate a raise to offset inflation.

 

 

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On 9/19/2022 at 7:50 AM, delekkerste said:

 if you took 1 or 2 bidders out of the running on a lot of pieces, you'd see vastly different results. 

 

My take is that this statement is true on high end art whether prices are up, down, or sideways.    Since the prices on high end material are by definition what only a few are willing and able to pay at any point in time, removing even one of those apex bidders changes the math completely.

On material that has broad appeal but more realistic pricing, say lower end kirby panel pages, you can probably remove a bidder or two without too damage (and you can probably add a bidder or two without changing the price much either).

But anything where the air is thin or the appeal is niche, its a razor's edge to prices going up or down at any point in time, no matter what the market is doing.

(To your point, there's underlying risk there at any time - in both directions).

Edited by Bronty
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On 9/19/2022 at 10:11 AM, Bronty said:

My take is that this statement is true on high end art whether prices are up, down, or sideways markets.    Since the prices on high end material are by definition what only a few are willing and able to pay at any point in time, removing even one of those apex bidders changes the math completely.

On material that has broad appeal but more realistic pricing, say lower end kirby panel pages, you can probably remove a bidder or two without too damage.

But anything where the air is thin or the appeal is niche, its a razor's edge to prices going up or down at any point in time, no matter what the market is doing.

Doesn't even need to be true high end art.  During the previous HA auction, it was myself and one other bidder running up a piece from $31K to a hammer price of $55K.  Take either the winner or underbidder out of the equation, and someone would have picked up a great page for ~ 75% less than final hammer.

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I’m curious how, and if, this all affects the bottom end of the hobby (below $10k) where most purchases are made. Do the higher levels buyers simply sit it out (which is my suspicion) or satisfy a purchasing urge, dipping down from buying above $100k, to between $100k and above $10k, and then down below $10k, or even lower price points. Since buying below $10k (or $1k) is not likely a burden for most people, at least occasionally, my suspicion is that that slice of the OA market’s pricing may not pause or even move up a little.

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On 9/19/2022 at 1:27 PM, Rick2you2 said:

I’m curious how, and if, this all affects the bottom end of the hobby (below $10k) where most purchases are made. Do the higher levels buyers simply sit it out (which is my suspicion) or satisfy a purchasing urge, dipping down from buying above $100k, to between $100k and above $10k, and then down below $10k, or even lower price points. Since buying below $10k (or $1k) is not likely a burden for most people, at least occasionally, my suspicion is that that slice of the OA market’s pricing may not pause or even move up a little.

If high end drops a bunch, and low end moves up a tick, don't you think people would consign the shyt out of their low end to purchase high end for the eventual correction?

I think its more likely that high end and low end move together.   Maybe not always at the same rate, but generally in the same direction.

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On 9/19/2022 at 3:11 PM, Bronty said:

If high end drops a bunch, and low end moves up a tick, don't you think people would consign the shyt out of their low end to purchase high end for the eventual correction?

I think its more likely that high end and low end move together.   Maybe not always at the same rate, but generally in the same direction.

No, I don’t think that’s necessarily correct at all. I wouldn’t consign my stuff to purchase “high end” stuff because the high end stuff isn’t going to satisfy my nostalgic urge. If the market at the high end drops, but I see a page from a book I want that seems to be going above existing market, I may still go for it if I want it. As compared to the stock market, I think the low end enjoys more price immunity as a collectible, but it is more likely to be affected by a drop in things like consumer spending and employment where middle to upper income folks are affected. 

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On 9/19/2022 at 6:50 PM, Rick2you2 said:

No, I don’t think that’s necessarily correct at all. I wouldn’t consign my stuff to purchase “high end” 

You might not do so, but the market is an aggregate of everyone’s behaviour and on masse, people compare and value out segments of the market.   For example ,  if someone wants a 10k page they might sell 2k pages to do it.    That creates a whole chain of pricing as I’m sure you’re aware, a whole pricing hierarchy.    The space between lower end and higher end might compress at times, like an accordion pushed together, and it might expand at times, like an accordion pulled apart, but certain lines in that relative pricing structure  won’t be crossed except in unusual circumstances.    All those thousands of interrelated data points will create directional consistency.  

Edited by Bronty
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On 9/20/2022 at 12:03 AM, Bronty said:

The space between lower end and higher end might compress at times, like an accordion pushed together, and it might expand at times, like an accordion pulled apart, but certain lines in that relative pricing structure won’t be crossed except in unusual circumstances.

That's pretty much how I see things too. If you look at the lower end you will get people with the least disposable income feeling the oncoming squeeze the most.

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I still maintain that we aren't going to see much change (except for continued upward movement) anytime soon.

I will just point to the Great Recession, the worst financial disaster since the Great Depression, and the barely noticeable blip it had on OA markets.

For OA to be affected, a lot of High Rollers would have to feel that their War Chests are truly at risk.  For that to happen, we'd need another Great Recession, only this one would have to last three or four times longer.  There's still too much money on the sidelines, ready to pounce... in both the Stock Market, and the OA market.

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