Investment Potential

Rich Klein · #1 12-29-2009, 07:28 AM

"Face it, newspaper circulation is decreasing because people are reading the news on their computers. Book sales are either decreasing or staying flat because people can either download a book off the web and onto their computers or use some other electronic means to buy and store a book. I imagine in 20 years or so, kids who want to collect "old" baseball cards will be doing so by gathering images on their electronic devices and storing their "collections" on a microchip instead of a shoe box or binder in their closet."

Not only that; but music as well. When we were growing up you had to buy a record or a tape or a CD (depending on your age). NOW, all you need to do is listen on a computer OR use a device such as an IPod and download songs to that.

The need for "stuff" in today's world is much less than it was a few years ago.
Heck, yesterday Amazon.Com announced they sold more ebooks for the holiday season than they did physical books.

Rich

P.S. For "investing:" $5K in cards, I'd find the best condition cards available of the best players that you can. You won't get anywhere near a T206 Wagner but you could get a nice portfolio of a VG Goudey Ruth; A NM mid career Mantle; and a few other baubles. A very safe portfolio with little downside.

Exhibitman · #2 12-29-2009, 08:15 AM

I would dissuade him from investing blindly in cards. Just like any other form of investment cards require study and knowledge of the markets and issues. You wouldn't buy a bundle of mortgage loans blindly, right...ok, bad example.

yanksfan09 · #3 12-29-2009, 10:16 AM

As a young collector (27), I too am uncertain about the long term investment potential of cards for the generational reasons previously stated. However, it seems to me that currently many people are uncertain for the long term investment potential in almost all areas (stocks, bonds etc...). There are many Geo-political, environmental etc... factors that have people uneasy.

Either way, I've been hooked on cards since I was about 8 years old and will collect them until I die, regardless of value/price.

For a 3-5 up to maybe 10 year investment I would feel comfortable staying with the true immortal/legendary players such as Ruth, Cobb, Gehrig, Wagner, Mantle etc.... I would stick with hitters as opposed to pitchers. A card of one of these type of players from their playing days is essential. Buy an attractive card and strive for a lesser seen issue, but it doesn't have to be exceedingly rare. And buy it in the best condition for the best price you can find. Be patient and wait for the right deal to come about.

barrysloate · #4 12-29-2009, 10:22 AM

Erick- it's certainly true we are living in an era where things change quickly and we never really know what to expect next. That makes it harder for us to make good choices whatever we are doing. I still maintain if you put together a quality collection of scarce cards, learn about them, keep adding to them over a long period of time, and have patience you will probably do fine and what you have will appreciate in value. But like others, I am leery of the idea of a 3-5 year investment portfolio. Those things don't always work out.

vintagechris · #5 12-29-2009, 10:31 AM

Tell him to buy silver. I also like presidential autographs. They will always be part of American history and I think will always be sought after. They are also a bargain if you compare them to baseball autographs.

yanksfan09 · #6 12-29-2009, 10:40 AM

Barry- Agree and exercising patience for the right deal is key. I also want to echo the potential of signed checks of certain players. However, you need to do a lot of homework before buying any signed stuff.

barrysloate · #7 12-29-2009, 10:46 AM

Your chances of making money on anything increase dramatically if you study and learn as much about it as possible. Too many people invest without really knowing what they are doing, and often they are disappointed with the results.

ctownboy · #8 12-29-2009, 11:08 AM

bosoxphan,

I somewhat disagree. Like I said before, I am 42 and could count at least 10 other guys just from my graduating clas who collected cards in middle school. But ALL of them stopped collecting by the time they were 18 and I doubt they have started collecting again even though they probably have children of their own right now.

One guy I know did NOT start collecting again because he died years ago and he was the one who had the best collection of all of us (his Dad gave him his cards he had collected in the 1950's).

Also, people my age are stuck. When we were born there weren't many of us to begin with. Look at the population reports and you will seee there is a bottleneck between the Baby Boomers and the Gen X'ers. I and people my age, am stuck in that bottleneck.

For the most part, we had to wait for the better jobs because the Baby Boomers were still alive and working. Look at the Fortune 500 companies and the people at the top of those companies. Look at their ages. How many 40 to 45 years olds do you see? Not many. Those companies are still led by people 50 and older. Lower down the chain of command you will find people my age but you will also find plenty of Boomers there also.

So, there weren't many of us to begin with and we have been stuck, as far as advancing to the top levels of business. This means our incomes haven't been as high as the generation before us, the ones who are now at the top of the business chain and who are the whales.

Then there is the Gen X'ers behind us. The people who not only knew how to use computers but who also knew how to build them and write code for them. They are the ones who started the tech companies and who made the big bucks. Not many people my age are on the list of tech company founders.

Look at the ages of the guys who started Youtube and Face Book. They are younger than me and worth a heck of a lot more money than me. I seriously doubt they are into collecting baseball cards.

This is why I am pessimistic about "whales" my age or younger emerging in the baseball card collecting market. There are either less people they can develop from (my generation) or the larger group (Gen X) is interested in other things.

mdschulze · #9 12-29-2009, 12:31 PM

From reading these threads, it appears to me that there are 3 categories most baseball collectors fall into: 1) those who strictly "collect" to make money, 2) those who collect solely for the sake of loving cards, and 3) those who collect because they love cards but will also sell a few off if the prices are right.

I'm a category 2. Once a card is in my collection it will never leave as long as I have a say in the matter. Do I care what the cards are worth? A little, but if they were valued at zero I would still purchase cards for the sake of collecting. With that mindset, to me the values are secondary. I spend money on cards as if I were going to Vegas to play the slots. First, I only spend "extra" money. Second, if I spend $500 - $1000 and lose... it hurts but oh well! It's not like that was my retirement investments. Besides, the market will never drop to the point where you'll see T206 Cobbs going for $5.00. So unlike the slots in Vegas, your chances of going broke on cards is 0%. You will always be able to get something back for them

Also, as long as the miracle stories keep hitting the media like granny finding a card in her attic and trying to sell on Ebay for $10 when it's worth $50k or a 206 Wagner is bought at an estate sale for $1.00 then sold for $500k, I think the public will still be interested in baseball cards.

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