Liquidity & Investing vs collecting

[packs]

Originally Posted by LukeLyon

You're getting caught up on the idea that $300k is all of his money. I know that's a very large number to most of us, but you need to allow for the possibility that it is just a small portion of the money he wants to invest in various things.

Of course putting all of your investment money into baseball cards would be crazy. Putting all your money into any one investment instrument (other than t-bills and the like) would be very risky. In that regard, putting $300k into PSA 9 and 10 Jordans is really no different than putting it all into Coca Cola stock, or a single house. But all 3 can legitimately be called investments.

Just because you can't fathom putting $300k into high grade cards doesn't mean it should be called gambling any more than stocks or real estate should be.

This is my last post on this but you're missing my point. I can fathom someone spending 300K on a card. I'm not some pauper who thinks that's all the money in the world. And I don't understand the characterization. The price point is what I'm talking about. If you have that much to break off for cards, then you're a high roller and does it really matter if your card dividends pay out double or triple? I would say no. It would be nice if they did, but if they paid out the same amount you put in, or even slightly less than you put in, that's not making or breaking anything for you. That's because you're just having fun with your disposable money, like when you gamble. You aren't trying to build a future, you've already built a future if your card budget is 300K. I'm talking about the guy who sees a post about cards as commodities and invests their life savings into cards. That is what I'm saying would be insane. Not spending your card budget, whatever that may be, on the chance that you might make a little more money.

[ALR-bishop]

Not sure about you Packs, but I do not know most of the people on this board on a personal level. I just know them by their posts. I do not think I could accurately generalize about why or how people should collect. Each person must decide based on their own circumstance. One can be a just a buyer, just a seller, just a collector, just an investor, or any combination thereof. All I know for sure is my own situation, and I have enjoyed collecting cards since 1957.... and still do

[Luke]

Originally Posted by packs

This is my last post on this but you're missing my point. I can fathom someone spending 300K on a card. I'm not some pauper who thinks that's all the money in the world. And I don't understand the characterization. The price point is what I'm talking about. If you have that much to break off for cards, then you're a high roller and does it really matter if your card dividends pay out double or triple? I would say no. It would be nice if they did, but if they paid out the same amount you put in, or even slightly less than you put in, that's not making or breaking anything for you. That's because you're just having fun with your disposable money, like when you gamble. You aren't trying to build a future, you've already built a future if your card budget is 300K. I'm talking about the guy who sees a post about cards as commodities and invests their life savings into cards. That is what I'm saying would be insane. Not spending your card budget, whatever that may be, on the chance that you might make a little more money.

I'm with you on having these be the last posts. I definitely did not mean to characterize you as a "pauper" or anything of the sort. I just disagreed with your argument. It seems like you are saying that if someone has millions of dollars, you don't consider them investors anymore because they are already set for life. If the OP has $10mil, and wants to put $300k into baseball cards because he expects to grow his money, how is that not investing? Can Warren Buffet invest in anything, or when he buys up shares of a new company, is he simply gambling, since he really doesn't need the money?

It's just semantics, but I still think you are missing the point. I of course agree that no one should put all of their savings into baseball cards. They also shouldn't put it all into Coca Cola stock, but I bet you would call that an investment rather than a gamble.

[Luke]

I agree with everything you wrote Dave fwiw. I just disagreed with the comparison to roulette.

[trdcrdkid]

Originally Posted by LukeLyon

I agree with everything you wrote Dave fwiw. I just disagreed with the comparison to roulette.

Yeah, I know we're on the same page. I just quoted your post because it mentioned a lot of the issues being discussed.

[Peter_Spaeth]

Re cards being so volatile, when was the last time the card market dropped 50 percent? When was the last time it dropped significantly at all?

[kickitup]

Packs,

I am sorry I hurt your feelings when I responded to your opinion of what you might believe I am doing should be characterized as. Hurting your feelings was not the intent. You are no better or no worse than me, period. The amount of money I have or don't have should not characterize what I do with it or how the impacts of what I choose to do affect my life.

Calling what I am doing gambling is ignorant. Why? Because you have no idea what my situation is, just like I have no idea what yours is.

Just because it's a lot to you doesn't mean it's a lot to me. That's ok too... You are likely a nice guy, a great friend, a great dad etc, but just because I might have more money than you doesn't make me a gambler and you a collector because of the dollar amount I choose to put into cards.

My whole point was here that I am trying to encourage you all to not get caught up in what things used to be worth, but instead what they are worth now and what they will be worth in the future. I get annoyed so often by people complaining about how dumb prices are and how much manipulation goes on. I make up that people blame it on manipulation that prices are going up, but my sense is these same people are stuck in the past.

Hypothetically speaking, If I am willing to buy one Lou Gehrig card for 300k and that has a population of 3, I can assure you I am also willing to buy the other two for the same price before I let one of them go for less. I am an investor and I will protect my investment accordingly. I don't make any move without being willing to protect my move. If I think a card is worth 300k and there are 3 of them, I need to be willing to invest 900k in that card to make that purchase. That's not gambling, that is smart and logical investing. If I end up buying all 3 for 900k, fine, but I sure am going to support the market to protect my investment. I can only do that if I buy within my means and go in with a plan.

I hardly call that gambling. I think it's smart. I don't need you to agree with me, but I don't appreciate it when anyone tries to characterize what I am willing to do gambling when the dollar amount is merely larger than an amount they might be comfortable spending.

I can tell you all this. I don't buy a 50k Namath rookie unless I am willing to buy 50 of them for that. I consider my investments before I make them. I encourage those who don't think this way to realize there are others like me out there that are willing to buy not only one card, but all of them for "X" price and control the market.

This is happening and it bugs me that no one else realizes it. I can't convince you all that this is right or wrong, but I'm telling you it's happening because I am doing it and will continue to do so.

[botn]

Originally Posted by kickitup

Packs,

I am sorry I hurt your feelings when I responded to your opinion of what you might believe I am doing should be characterized as. Hurting your feelings was not the intent. You are no better or no worse than me, period. The amount of money I have or don't have should not characterize what I do with it or how the impacts of what I choose to do affect my life.

Calling what I am doing gambling is ignorant. Why? Because you have no idea what my situation is, just like I have no idea what yours is.

Just because it's a lot to you doesn't mean it's a lot to me. That's ok too... You are likely a nice guy, a great friend, a great dad etc, but just because I might have more money than you doesn't make me a gambler and you a collector because of the dollar amount I choose to put into cards.

My whole point was here that I am trying to encourage you all to not get caught up in what things used to be worth, but instead what they are worth now and what they will be worth in the future. I get annoyed so often by people complaining about how dumb prices are and how much manipulation goes on. I make up that people blame it on manipulation that prices are going up, but my sense is these same people are stuck in the past.

Hypothetically speaking, If I am willing to buy one Lou Gehrig card for 300k and that has a population of 3, I can assure you I am also willing to buy the other two for the same price before I let one of them go for less. I am an investor and I will protect my investment accordingly. I don't make any move without being willing to protect my move. If I think a card is worth 300k and there are 3 of them, I need to be willing to invest 900k in that card to make that purchase. That's not gambling, that is smart and logical investing. If I end up buying all 3 for 900k, fine, but I sure am going to support the market to protect my investment. I can only do that if I buy within my means and go in with a plan.

I hardly call that gambling. I think it's smart. I don't need you to agree with me, but I don't appreciate it when anyone tries to characterize what I am willing to do gambling when the dollar amount is merely larger than an amount they might be comfortable spending.

I can tell you all this. I don't buy a 50k Namath rookie unless I am willing to buy 50 of them for that. I consider my investments before I make them. I encourage those who don't think this way to realize there are others like me out there that are willing to buy not only one card, but all of them for "X" price and control the market.

This is happening and it bugs me that no one else realizes it. I can't convince you all that this is right or wrong, but I'm telling you it's happening because I am doing it and will continue to do so.

Not sure I understand why it is necessary to own all or attempt to own all of a particular card in order to justify owning one? What you have described is more of market manipulation or positioning yourself so that you can manipulate the market. I know you will not agree.

[benchod]

Originally Posted by kickitup

Packs,

I am sorry I hurt your feelings when I responded to your opinion of what you might believe I am doing should be characterized as. Hurting your feelings was not the intent. You are no better or no worse than me, period. The amount of money I have or don't have should not characterize what I do with it or how the impacts of what I choose to do affect my life.

Calling what I am doing gambling is ignorant. Why? Because you have no idea what my situation is, just like I have no idea what yours is.

Just because it's a lot to you doesn't mean it's a lot to me. That's ok too... You are likely a nice guy, a great friend, a great dad etc, but just because I might have more money than you doesn't make me a gambler and you a collector because of the dollar amount I choose to put into cards.

My whole point was here that I am trying to encourage you all to not get caught up in what things used to be worth, but instead what they are worth now and what they will be worth in the future. I get annoyed so often by people complaining about how dumb prices are and how much manipulation goes on. I make up that people blame it on manipulation that prices are going up, but my sense is these same people are stuck in the past.

Hypothetically speaking, If I am willing to buy one Lou Gehrig card for 300k and that has a population of 3, I can assure you I am also willing to buy the other two for the same price before I let one of them go for less. I am an investor and I will protect my investment accordingly. I don't make any move without being willing to protect my move. If I think a card is worth 300k and there are 3 of them, I need to be willing to invest 900k in that card to make that purchase. That's not gambling, that is smart and logical investing. If I end up buying all 3 for 900k, fine, but I sure am going to support the market to protect my investment. I can only do that if I buy within my means and go in with a plan.

I hardly call that gambling. I think it's smart. I don't need you to agree with me, but I don't appreciate it when anyone tries to characterize what I am willing to do gambling when the dollar amount is merely larger than an amount they might be comfortable spending.

I can tell you all this. I don't buy a 50k Namath rookie unless I am willing to buy 50 of them for that. I consider my investments before I make them. I encourage those who don't think this way to realize there are others like me out there that are willing to buy not only one card, but all of them for "X" price and control the market.
This is happening and it bugs me that no one else realizes it. I can't convince you all that this is right or wrong, but I'm telling you it's happening because I am doing it and will continue to do so.

Well, your original premise is built on shaky grounds. There is a large difference between graded cards as a commodity vs oil, precious metals, hogs etc. When you buy a pound of gold or a barrel of oil you know what you are receiving. Would a barrel of oil sell for $50 if it half water? What if your gold bullion was mixed with nickel? With cards you're assuming that the flip accurately reflects the card and that a PSA 10 is superior to a 9 etc. What if the 10 was in a 9 holder and was resubmitted 20 times to get into a 10 holder? Is it now magically a superior card? 19/20 times it was judged to be a 9. Trimmed and doctored cards are another major factor. You brought up Kendricks collection. His centerpiece card is the prime example of problems with relying exclusively on a grading company's opinion.

[mechanicalman]

Originally Posted by kickitup

I can tell you all this. I don't buy a 50k Namath rookie unless I am willing to buy 50 of them for that. .

OK, but how many PSA 6 Home Run Bakers will it take to protect your $6K investment?

[ezez420]

You have got a big set of balls posting this.

Originally Posted by kickitup

Packs,

I am sorry I hurt your feelings when I responded to your opinion of what you might believe I am doing should be characterized as. Hurting your feelings was not the intent. You are no better or no worse than me, period. The amount of money I have or don't have should not characterize what I do with it or how the impacts of what I choose to do affect my life.

Calling what I am doing gambling is ignorant. Why? Because you have no idea what my situation is, just like I have no idea what yours is.

Just because it's a lot to you doesn't mean it's a lot to me. That's ok too... You are likely a nice guy, a great friend, a great dad etc, but just because I might have more money than you doesn't make me a gambler and you a collector because of the dollar amount I choose to put into cards.

My whole point was here that I am trying to encourage you all to not get caught up in what things used to be worth, but instead what they are worth now and what they will be worth in the future. I get annoyed so often by people complaining about how dumb prices are and how much manipulation goes on. I make up that people blame it on manipulation that prices are going up, but my sense is these same people are stuck in the past.

Hypothetically speaking, If I am willing to buy one Lou Gehrig card for 300k and that has a population of 3, I can assure you I am also willing to buy the other two for the same price before I let one of them go for less. I am an investor and I will protect my investment accordingly. I don't make any move without being willing to protect my move. If I think a card is worth 300k and there are 3 of them, I need to be willing to invest 900k in that card to make that purchase. That's not gambling, that is smart and logical investing. If I end up buying all 3 for 900k, fine, but I sure am going to support the market to protect my investment. I can only do that if I buy within my means and go in with a plan.

I hardly call that gambling. I think it's smart. I don't need you to agree with me, but I don't appreciate it when anyone tries to characterize what I am willing to do gambling when the dollar amount is merely larger than an amount they might be comfortable spending.

I can tell you all this. I don't buy a 50k Namath rookie unless I am willing to buy 50 of them for that. I consider my investments before I make them. I encourage those who don't think this way to realize there are others like me out there that are willing to buy not only one card, but all of them for "X" price and control the market.

This is happening and it bugs me that no one else realizes it. I can't convince you all that this is right or wrong, but I'm telling you it's happening because I am doing it and will continue to do so.

[thenextlevel]

Originally Posted by Peter_Spaeth

Re cards being so volatile, when was the last time the card market dropped 50 percent? When was the last time it dropped significantly at all?

This would be immediately after the era of overproduction. Everybody in the late 80's and early 90's were buying cards to put away for retirement. People were paying ridiculous prices for OPC premiere, Stadium Club, Kevin Maas rookies, etc, etc. That crash cost a lot of people money. Now of course this wasn't across all areas of collecting, but nevertheless, the "card market" dropped big time. I understand that this was the overproduced crap, but the people who were dumping money into the hobby had no clue(maybe like the people now dumping money into the sportscard market and inflating prices), and the rug was pulled out from under them. It all comes down to choosing wisely. If you know a collectibles market, then you can use it as an investment vehicle and limit the downside.

[Peter_Spaeth]

Originally Posted by thenextlevel

This would be immediately after the era of overproduction. Everybody in the late 80's and early 90's were buying cards to put away for retirement. People were paying ridiculous prices for OPC premiere, Stadium Club, Kevin Maas rookies, etc, etc. That crash cost a lot of people money. Now of course this wasn't across all areas of collecting, but nevertheless, the "card market" dropped big time. I understand that this was the overproduced crap, but the people who were dumping money into the hobby had no clue(maybe like the people now dumping money into the sportscard market and inflating prices), and the rug was pulled out from under them. It all comes down to choosing wisely. If you know a collectibles market, then you can use it as an investment vehicle and limit the downside.

Yeah I remember that stuff and superpremium cards and all that but other than some individual cards like Canseco tanking and maybe wax prices of the really overproduced crap I don't remember a major drop. But if that's the last time it's been quite a while, no?

[ls7plus]

Originally Posted by thenextlevel

This would be immediately after the era of overproduction. Everybody in the late 80's and early 90's were buying cards to put away for retirement. People were paying ridiculous prices for OPC premiere, Stadium Club, Kevin Maas rookies, etc, etc. That crash cost a lot of people money. Now of course this wasn't across all areas of collecting, but nevertheless, the "card market" dropped big time. I understand that this was the overproduced crap, but the people who were dumping money into the hobby had no clue(maybe like the people now dumping money into the sportscard market and inflating prices), and the rug was pulled out from under them. It all comes down to choosing wisely. If you know a collectibles market, then you can use it as an investment vehicle and limit the downside.

This is exactly right. Collectors thought 1990 Leaf Frank Thomas rookies, 1989 Ken Griffey Jr. Upper Deck rookies and the like would only keep going up, up and away (like the Fifth Dimension, in their beautiful, beautiful balloon). Many dollars were being put into huge lots of these cards, but a liquid market for those lots never developed. The impact of huge production set in, and much of the market, mostly new cards, but with an overflow effect even on '50's and '60's cards, tanked. By recollection, the '52 Topps Mantle dropped in NrMt grade from $30,000 or so to around $15K by 1995. I don't think this market is like that one, because much of the $$$ is going into truly desirable, proven cards which are at least condition rarities, and seldom seen in high grade (note based on my previous posts above that I do not include the '86 Fleer Jordan in gem mint "10" in that group because it is so prevalent in only slightly lesser grades).

Regards,

Larry