Selling cards at a loss

[parkplace33]

On Youtube, I enjoy watching Baseball Collector Card Investor Dealer. He had a video a few days ago where he did a Q and A session:

https://www.youtube.com/watch?v=Qu34rpDM_Rc

One question was that was brought up was do you ever sell cards at a loss? (2:30 mark). He admitted that he does sell cards at a loss, all the time.

At local shows (and even the National), how many have seen the same cards/packs/memos with the same prices over and over again. Or have heard the phrase “I have too much into it”. Or have seen the same items listed on ebay over and over again. I am always curious what eventually happens to those cards.

[raulus]

Sometimes the market goes nuts, the price of everything quintuples in value, and items that have been sitting for the last 10 years because they were crazy overpriced, well, they all sell out within minutes.

[scooter729]

The philosophy of "I paid this, I can't sell for less" drives me nuts from a business perspective, on easy to locate cards. That same person would never say, "well, I paid $500, so I'll sell it for that, even though the market says it should be $1,000 now."

If you're going to take advantage of market prices when there's a profit, you should be aware of the going rate when trying to sell. Or else you'll never sell an item.

I have a basketball card which I bought for $750 during the basketball peak, a year or so ago. It's worth maybe $400 now. If I needed to sell it, I would sell at the going rate of $400. Insane to think that because the owner paid more than the current going rate, to expect someone else to then do the same as well.

[1952boyntoncollector]

Originally Posted by scooter729

The philosophy of "I paid this, I can't sell for less" drives me nuts from a business perspective, on easy to locate cards. That same person would never say, "well, I paid $500, so I'll sell it for that, even though the market says it should be $1,000 now."

If you're going to take advantage of market prices when there's a profit, you should be aware of the going rate when trying to sell. Or else you'll never sell an item.

I have a basketball card which I bought for $750 during the basketball peak, a year or so ago. It's worth maybe $400 now. If I needed to sell it, I would sell at the going rate of $400. Insane to think that because the owner paid more than the current going rate, to expect someone else to then do the same as well.

well they dont have to sell it and they telling you why..
'
some buyers say 'i only want to pay $300 or whatever and they only have that much money on them when market price $500' so realize there are all kinds on both sides

[HercDriver]

When somebody I'm talking to about a card says "Well, I have $X into it," I generally move on. It almost always means you'll be overpaying for it. If they have to say that, it means the card is probably not worth what they paid anymore. It happens...look at the stock market. If I buy CSCO at $100 and it goes to $80, I don't hold onto it because I have $100 into it. Take your loss and move on to something else. What you have into a card is only relevant to the seller. It is immaterial to the buyer.

Cheers,
Geno

[mrreality68]

I have rarely ever sold for a loss. However, the few times I have done it is to raise cash to buy another card that I did not want to lose the chance to get. Especially when they are low population cards that I want that do not hit the market often

[Peter_Spaeth]

Agree that what someone has into a card is completely irrelevant. No one is entitled to make a profit. But if someone wants to be buried along with their cards, that's their right.

[conor912]

Sunk-cost Fallacy

The phenomenon whereby a person is reluctant to abandon a strategy or course of action because they have invested heavily in it, even when it is clear that abandonment would be more beneficial.

[raulus]

Originally Posted by conor912

Sunk-cost Fallacy

The phenomenon whereby a person is reluctant to abandon a strategy or course of action because they have invested heavily in it, even when it is clear that abandonment would be more beneficial.

There's a name for it because it's a common phenomenon.

I think in banking they use the terms:

Extend and pretend

Delay and pray

[D. Bergin]

Originally Posted by 1952boyntoncollector

well they dont have to sell it and they telling you why..
'
some buyers say 'i only want to pay $300 or whatever and they only have that much money on them when market price $500' so realize there are all kinds on both sides

Yeah,

I don't do many shows anymore, but when I used to, I'm sure I used the phrase "I've got more then that into that" along with a noticeable smirk on my face, more then once, to a low baller who was cruising by my table and throwing out a fishing line at me.

I was almost always willing to negotiate, but if you insult me right off the bat, I figure using that line is much more polite then just telling them to "go eat sh*t".

[Jewish-collector]

I love when the dealer says, "Let me see what I have into it " Then, I say in a nice way, "I don't care what the hell you have into it." Funny as hell.beer chug.gifbeer chug.gifbeer chug.gif

[Snowman]

I ask myself one question: "would I buy this today for what I could sell it for?" If the answer is no, I sell it. If it's yes, I keep it. What I paid for it doesn't matter one bit.

[RichMcGillicuddy]

Wait. There was a thread yesterday saying to take money out of your 401K to "invest" in cards. Cards can go down???

[G1911]

I've done some "I paid X, I can't sell for less" deals. It's not logical for commonplace items, but sometimes it's the only data point there is to try and value an obscure or rare item. In those cases, I don't mind the seller doing that because we're both essentially guessing what the card might be worth. Sometimes I'm just grateful they are willing to let it go at all. When I hear that for a T206 or Goudey or Topps card, I move on.

[raulus]

Originally Posted by RichMcGillicuddy

Wait. There was a thread yesterday saying to take money out of your 401K to "invest" in cards. Cards can go down???

That's a myth. It's been disproven here many times.

[RichMcGillicuddy]

So if the Mantle went from 50K to 12+ million.. if it goes up another 240x , it should be 2.9 billion in a few years, right? Phew...

[raulus]

Originally Posted by RichMcGillicuddy

So if the Mantle went from 50K to 12+ million.. if it goes up another 240x , it should be 2.9 billion in a few years, right? Phew...

Inflation…

[G1911]

Originally Posted by RichMcGillicuddy

So if the Mantle went from 50K to 12+ million.. if it goes up another 240x , it should be 2.9 billion in a few years, right? Phew...

That’s why I’ve drained my 401K and IRA, as well as my stock investments and savings account. I’ve got $3.50 left for food this week to hedge my bet. Money printer go brrrrr

[Johnny630]

Originally Posted by RichMcGillicuddy

Wait. There was a thread yesterday saying to take money out of your 401K to "invest" in cards. Cards can go down???

Well a SGC 5 1952 Mantle just recently sold for a little over $300,000. It would not shock me to see PWCC or any other Major Auction House list another 1952 Topps Mantle SGC 5 with very similar centering in the near future. It will be interesting to see what happens. I think it's maxed out in lower grade 5 and under but I've been dead wrong on it for the past two years. Time will tell.
It's all timing.

[RichMcGillicuddy]

$3.50? Almost buying a gallon of gas...

My daughter spent $20 on Taco Bell for her and a friend last month. That used to be a lot of tacos.

[obcmac]

I think using the "what do I have in it approach" is actually a decent strategy. My goals are trying to have fun and try not to lose money while doing it. If I am selling for more than I paid, then at least I'm not going the wrong direction. As a buyer, if I know someone paid $500 and is asking for $600, then a $400 offer probably won't work. Of course, people manipulate this idea when trying to get more money out of a buyer...so not always an honest negotiating point. If I NEEDED to sell something, which is almost never the case, then I would change from a basic rule of thumb approach to assessing the current market conditions.

[G1911]

Originally Posted by RichMcGillicuddy

$3.50? Almost buying a gallon of gas...

My daughter spent $20 on Taco Bell for her and a friend last month. That used to be a lot of tacos.

$3.50 a gallon of gas and .79 soft tacos was how I survived college. The food inflation hurts the most.

[Johnny630]

I know of a dealer at the National that has the same stuff and prices for at least 20 years. Nothing sells. I am not sure why he continues to come. I would guess it’s for the fun and memories of the past.

[Mark17]

To put things in perspective, and to make me feel better, I look at it as a trade.

Suppose there's something I'd like to add to my collection that I can get for $1,000. I have something else that I paid $1400 for, but now could only sell for $1000. Rather than looking at it as taking a $400 hit, I ask myself if I'd make the trade - the thing I want to sell for the thing I'd like to get.

If the answer is yes, I do it and have no regrets.

[Exhibitman]

For genuinely rare items, there is no need to compromise a price. My general reaction when someone wants a rare item is to set a price and if they haggle, tell them to go find one somewhere else. Nearly always results in capitulation.

But I digress from the OP.

One more reason to take losses is the same one you use in balancing a stock portfolio: offsetting taxable profits.

[oldjudge]

Cards are like any other asset, they go up and down in value. You can maintain a posture of never selling a card at a loss but that may result in you waiting years to sell it, or having your heirs sell it at a loss.

[Mike D.]

Originally Posted by RichMcGillicuddy

Wait. There was a thread yesterday saying to take money out of your 401K to "invest" in cards. Cards can go down???

On the bright side, at least my 401K can't go down...

[Brian Van Horn]

Shill bidding is a contributor to selling cards at a loss.

[bbcard1]

Of late I have see a lot of "just selling it for what I paid for it because of a new opportunity" posts both here and on Facebook. The problem is that in many cases the seller bought at the top of the market and what they are offering the card/piece for no longer accurately reflects the current market.

[raulus]

Originally Posted by Brian Van Horn

Shill bidding is a contributor to selling cards at a loss.

Because the original buyer overpaid in order to outbid the shill bidders, and now that they're trying to sell, nobody wants it at that price?

[1952boyntoncollector]

Originally Posted by Jewish-collector

I love when the dealer says, "Let me see what I have into it " Then, I say in a nice way, "I don't care what the hell you have into it." Funny as hell.Attachment 534329Attachment 534329Attachment 534329

well maybe they mean they can sell it a bit less than market price if have much less into it percentage wise than normal etc

[Luke]

People are always so aggro when this topic comes up on here. I'm sure there are some situations where the value of a card is obvious, but most of the time that I say "I have X into it" or a friend says it, the value is uncertain. A lot of the cards I buy I buy from friends. If we are talking about a card and I say, Would $800 work?", and they say, "No, I have $1000 into it." that is just good info for me. I don't want to ask a friend to lose money on a card, so I either just quit trying to get it, or I sometimes think it over and decide I want it bad enough to up my offer.

And the times that I've said the same, it's because I have a pretty good idea that I can sell it for the price I paid or more. I've told people who make me an offer, "Sorry I paid more for it." many times as a nice way to say they are not in the right neighborhood, and then sold the card for the price I wanted to get for it many, many times.

[Popcorn]

I’ve noticed they went bananas in 16’ and 20’. the 2020 Covid bananas prices seemed to last longer and are still in affect for vintage rare cards. Seems to coincide with election years. 24’ will be interesting.

[dmats33312]

From a business perspective it just doesn’t make sense to hold a non performing asset. You can take that money and put it into something that you will get a greater return possibly multiple times over before selling the card at the price to break even.

[Brian Van Horn]

Originally Posted by raulus

Because the original buyer overpaid in order to outbid the shill bidders, and now that they're trying to sell, nobody wants it at that price?

Yes.

[BobC]

Originally Posted by Exhibitman

For genuinely rare items, there is no need to compromise a price. My general reaction when someone wants a rare item is to set a price and if they haggle, tell them to go find one somewhere else. Nearly always results in capitulation.

But I digress from the OP.

One more reason to take losses is the same one you use in balancing a stock portfolio: offsetting taxable profits.

You have to be careful though. If you are operating as a dealer in business, then you can offset the losses. If you are a collector/hobbyist though, and not in a formal business as a dealer, you CANNOT offset any losses from a hobby activity against any hobby gains.

Technically, if you are strictly an investor in cards, you could then offset card losses against card gains, but you'd have to convince the IRS that cards they consider as hobby collectibles can be differentiated and shown/proven to be investment assets held by you, like stocks and bonds. If you claimed the card losses as an investor and went to deduct them on your tax return, and the IRS came back at you, you may not be able to get them to agree with your thinking and reasoning that they are actual investments. I've said this before, an investor would more likely keep their cards in a safe deposit box or with one of these Vault operators, a collector/hobbyist would more likely keep and display them on the walls/shelves in their man cave/office.

[BobC]

Double post.