PSA Debacle - What to do for a Novice Collector?

[Johnny630]

John,

Everything you said is 100% true and the bottom line.

Well put

[jchcollins]

Originally Posted by Johnny630

John,

Everything you said is 100% true and the bottom line.

Well put

Thanks.

[SOX75]

I have personally chosen to wait until the FBI concludes their investigation and hands the case to the US Attorneys Office before I buy any more high end vintage PSA cards. There's still a few unknowns about what role PSA had in certifying these cards. We do know that card doctors targeted high end vintage cards to alter. We also know that they trimmed cards worth less than $5. It's hard to know what is safe at this point. The '54 Aaron would be riskier than most at this point.

If I was considering buying something I would do a certification lookup to see if PWCC had their hands on a card at any time. I would also closely inspect the difference between the edges of the card and the interior holders on the slab. The trimmed cards that I have seen all have a noticeable gap, indicating that the card would be loose and move around inside the slab.

[drcy]

I largely, and respectfully, disagree with John and Johnny's theories.

Do people who own and have large amounts of money and belong to the PSA registry want altered cards to be priced by the grade label? Of course. Will people involved in the current PSA system want things priced that way? I assume for many, yes.

Will future collectors, people who are obtaining rather than currently invested, consider value that way? I doubt it. Will a future buyer pay the same invest the same amount of money than he otherwise would have in a card he knows is likely altered because of the incorrect label? I doubt it.

I think valuations will shift and change for graded cards, especially high-grade cards, as knowledge spreads and as new buyers not invested in the old system enter.

Another practical and major problem for the PSA 'true believers' is that when cards come up for sale and shown to be altered, that has to be addressed-- possibly the auction stopped, the card in its holdered form being removed from the market, or, at least, the seller overtly saying that this card is altered, mislabelled and being sold as such. If the card is proven to be altered, PSA itself may insist the card be removed from the holder and the serial number removed from the database. The PSA registry card owner's ideology about "buy the label" will be irrelevant in that matter, and it will be out of his hand. The involvement of lawyers and the FBI in the PWCC sales have shown this.

In fact, I am sure some big PSA registry owners are currently thinking "How do I go about selling my collection, knowing that many cards will be shown to be altered?" I assume that some have already consulted lawyers.

As people say, science doesn't care about your feelings . . . And the law doesn't care about baseball card sentiments. PWCC's arguments of "it's okay, just ignore the conservation and focus on the label' already hasn't worked with the FBI.

[Exhibitman]

Just find and buy a nice raw lower to middle grade card from a reputable dealer and forget about this slabbing crap.

[mferronibc]

Great thread. So David, are you suggesting that the value spread between graded cards will start to narrow? I.e that the difference between a graded 5 and 8 may someday only be a few hundred bucks instead of a few thousand given the mounting absurdity to the specific grades being gospel and the growing sense that the 8 grade is more likely to be altered in some way and the 5 more likely completely authentic?

[drcy]

Originally Posted by mferronibc

Great thread. So David, are you suggesting that the value spread between graded cards will start to narrow? I.e that the difference between a graded 5 and 8 may someday only be a few hundred bucks instead of a few thousand given the mounting absurdity to the specific grades being gospel and the growing sense that the 8 grade is more likely to be altered in some way and the 5 more likely completely authentic?

As I've said repeatedly before, it doesn't require everyone to change their minds to alter the market and values. It requires merely a large enough percentage. That there are people, even many people, who cling to and want you to cling to the old "Move along, nothing to see here" theory of card valuation may prove to be neither here nor there.

I believe that no one with knowledge of the current scandal considers high graded cards the same as before. You see this even on the PSA boards. This change in consideration and sentiments will change or shift values in the future. Plus, there will be a shrinking of the market for such cards. Even on the PSA board, posters say they won't, if at least currently, buy such cards, and many future collectors, otherwise would have, simply won't enter that game and/or accept the old "ignore that the label is wrong" paradigm.

And, as I said, the law puts a big chink in the "just ignore that the label is wrong" financial model. Irrelevant to their sentiments and valuation beliefs, I'm sure many wealthy Registry people aren't about to follow the PWCC model of selling known altered cards. And guess what? It was that illegal PWCC model, coupled with the before-the-scandal collector's sentiments and lack of awareness of how many cards are altered and mislabelled, that created the market values.

To think the valuations, especially of high-grade cards, won't be shifted and changed in the future is daft. How exactly they will be shifted and changed I don't know. However, I'm certain many future, and current, collectors aren't going to pay the current, or recent, rate of 50x value for the removed wrinkle, erased pinpoint spot or lightly pressed left corner. And, believe it or not, not everyone (obviously) but many collectors and investors are not going to say "The card is grade poor but the label is wrong as says it's a 10, so I'm going to pay the higher 10 value."

Millions of dollars worth of current collectors and invistors, including on the PSA board, are already asking for and have asked for their money back for such mislabeled cards-- which, in and of itself, demonstrates that they value, or fear/know others value, such cards less than what was paid. And it only takes a good percentage of those people, coupled with the evergrowing expansion of the knowledge of how many cards are mislabelled like that, to shift market values-- and the returns to PWCC for refunds shows that they already exist. The value for all those millions of dollars of "ignore the card, and price by the label" cards have already fallen, and won't be valued the same if they return to the market. I would offer that as proof in the pudding.

All one has to do to answer the qeustion is ask oneself how many of those outed cards are valued the same. I would guess that 99.9% are valued less, usually majorly less. that what was paid. As evidenced by all the returns, refunds and the ubiquitous, even on the PSA boards, question "What do I do if my card is outed on Blowout cards?"

PSA isn't saying "Return the mislabelled cards to the seller for a full refund" because they think the cards have the same market value as before. They are saying that because even they know the cards are worth than what was paid. They are saying that the realization, both to the collector and the general hobby that the card is altered and does not match the label has devalued the card enough that their official advice is "Get your money back."

And to think some people are claiming "Values won't change"? (?!?!) Even PSA doesn't believe that. Even PSA is saying "You overpaid. The card isn't worth that much, get a refund."

[geosluggo]

Originally Posted by Exhibitman

Just find and buy a nice raw lower to middle grade card from a reputable dealer and forget about this slabbing crap.

This has generally been my philosophy. But when I completed a 1954 Topps set recently there were so many suspicious Aaron cards that I ended up buying a low-grade PSA card to be sure of its authenticity. Then I liberated it from its slab.

[Exhibitman]

Hence the "reputable dealer" part. Like Scottsdale Baseball Cards. I know Brian wouldn't sell a dodgy card and if one did get by he'd make good on it.

However, buying a lower grade card and cracking it out is a good strategy too. Though the newer PSA holders and the Beckett holders do make that a challenge to safely execute.

[OlderTheBetter]

Originally Posted by geosluggo

This has generally been my philosophy. But when I completed a 1954 Topps set recently there were so many suspicious Aaron cards that I ended up buying a low-grade PSA card to be sure of its authenticity. Then I liberated it from its slab.

I break out every slabbed card that I buy to complete my sets.

I'm not interested in selling them to break a set so no need to have them slabbed. I hate looking at cards in slabs -- it's just not natural.

I do have some single cards that are slabbed -- but not many. They're slabbed to sell in the future -- not to keep.

[mortimer brewster]

Originally Posted by Exhibitman

Just find and buy a nice raw lower to middle grade card from a reputable dealer and forget about this slabbing crap.

Well said. Especially if you are a novice. Then put the money you save into a nice Roth indexed fund with low P/E ratio . Years from now you will be glad you did.

[jchcollins]

Originally Posted by drcy

I largely, and respectfully, disagree with John and Johnny's theories.

David, thanks for your insight. I do not follow the PSA boards, so was basically just speculating on what I have seen here and also over on Blowout.

It's true that the market shift may also include those who own many such cards right now, and that newer collectors may help narrow the gap by being correctly informed when they go to make those types of purchases. Yours is certainly a more optimistic way of looking at the situation - and I appreciate that.