Crossover's and PSA

[cyseymour]

Having returned from vacation I would like to answer this thread:

Frank,

I think that comparing PSA to Enron and Bernie Madoff is a little over the top. I wouldn't take Jim Cramer's opinion very seriously, either, but I don't think that even he spreads rumors about companies going out of business.

Another thing that ought to be clarified: the difference between Collector's Universe and PSA, and the profitability of each. PSA was not profitable this past quarter due to the global economic crises, hardly an uncommon phenomenon. Collector's Universe had not been profitable for the past three years, due to a poorly-advised foray into the jewelry business - yet PSA had indeed been profitable. With 264,000 submissions, of course it is possible for PSA to be profitable, but maybe they weren't last quarter simply because they had expected more, causing greater expense. A simple downsizing is all that is needed. Anyways, I imagine that within a year PSA will post a profit, and this whole thread will seem absurd.

As far as the limitation in the number of cards to enslab, that would appear to be a much greater threat to a company such as SGC since they primarily grade vintage material. Yet it has to be something that anyone in the business must consider.

No one knows what the future holds. Yet Eric's arguments were one-sided and deceptive, for the many reasons I have already listed. Still he continues to root for a drop in the share price, which is now up to $4.90. Well that itself is the equivalent of $5 because to buy a penny stock like CLCT there is a spread of about ten cents. There is just not enough volume on a small stock like that to take a ten, twenty or thirty cent discrepancy seriously. It does not mean that CLCT is the next Enron.

We don't know who is selling at the share buyback, but notice that it says "up to", not a guarantee that it will buy back all the stock. Furthermore, even if an insider were to cash out, the company is still profitable, which means it has value. I am not saying that everyone should run out and buy the stock. I have no clue what the stock price is going to do, but neither does Eric. But spreading rumors of its demise (question mark or no question mark, it is still planting a HIGHLY BIASED seed in readers minds) is simply reckless in this situation. There is a name for it; it is called fearmongering. Eric is merely presenting one side of a poorly-graded coin (forgive the pun).

As for Eric's attempt to justify his statements by using an obscure non-sports issue as proof, anyone can see that that is ludicrous. It is almost evidence in itself against the very point he was trying to make. A far superior measure would be t206's or something like that. I will not take the time to tabulate sale prices of t206's because I have a life. However, the general consensus is that PSA graded cards go for more, especially in the high grades.

As far as the gentleman on this board who had his cards bumped, there are other possible explanations for the bumping. It is possible that since he complained, his cards were then reviewed by PSA's most expert graders. Those graders may have had a subjective opinion different than those who previously graded the cards.

Collector's Universe is not a scam. It is not the next Enron. It is not run by Bernie Madoff. Not only isn't it going out of business, it is indeed profitable. There is nothing more I can really say.

Kind regards,

Jamie