Effect of inflation on long term card prices
Willymac
Posts: 206 ✭✭✭
Open thread for open thoughts…really curious if 1) cards crater, 2) only rare stuff goes up/holds value 3) since prices for new stuff/packs etc are likely to increase does everything tick up….
Example does a diverse collection of mostly raw hall of famers slowly just tick up over time….or is it only 1996 Kobe chrome refractors in psa 10….
Very relevant topic especially since stock markets gonna puke…..curious what folks think…
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Good topic. I, too, wonder what effect inflation will have on card prices.
Always looking for Mantle cards such as Stahl Meyer, 1954 Dan Dee, 1959 Bazooka, 1960 Post, 1952 Star Cal Decal, 1952 Tip Top Bread Labels, 1953-54 Briggs Meat, and other Topps, Bowman, and oddball Mantles.
The ones I try to sell will tank. The ones I try to buy will skyrocket.
Guaranteed!
Shane
The main big time investors are making big money right now. Inflation usually hurts the little guy the most. So I can see a drop of overall purchases, but probably inflation will drive up prices on the high end.
Example: Attorney fees will be driven up. The people that need attorneys will have no option but pay for them, thus hurting the client's portfolio.
The job market is tight right now. 11.5 million jobs available, but a small amount of people that want to, that can or that will fill them. This is driving wages up. So an accountant who would have received about $50,000 a year or so ago, received $62,000 four weeks ago. She was the only person who applied, but had the right resume, so that company "lucked" out.
I.E. the people with good jobs are making more. But there are a large number of people who are being forced out, leaving on their own, taking unemployment, or just sitting it out. This will spread out the time a lot of cards will sell.
Folks will feel the effect of believing purchasing 200 1990 Fleer Jordan's or 1990 Leaf Frank Thomas or other various and sundry JUNK WA cards were long-term investments.
Those folks scoffed at any who said otherwise.Comeuppance looms
It's the singer not the song - Peter Townshend (1972)
S&P vs collectables:
Certain sectors of the collectible market have out performed the S&P 500 long term.
I currently hesitate to start new positions in any of the indices as inflationary and interest rate concerns will loom for most of the year.
I would NOT hesitate to buy quality vintage baseball. They aren't printing them anymore.
I have nothing more to say.
(just to get away from my 666th post)
Inflation is already baked in to prices IMO. The money supply is going to tighten up significantly, which will put downward pressure on prices. Something like 1/2 of the dollars in circulation were printed in the past 2 years. It's no surprise cards, art, cars, houses, boats, equities, etc all appreciated substantially the past 2 years. This is not normal and with QE ending, I don't see a lot of upward price movement broadly. Yes, the best stuff will always do well because a large portion of that newly printed money went to the wealthiest folks.
Inflation means the basics will cost more, so unless your income is increasing 10-15% YOY, most of us will have less money to spend on toys. It will get allocated to the essentials. I think there are some tough times ahead for hard and financial assets.
Nobody has a crystal ball but clearly there are a lot off bearish narratives in the economy. I think we are coming down off a very clear medium term collectibles peak in basically all sectors, especially Pokemon and Basketball. With Omicron waning and unemployment low I think the Fed is basically stuck and have to rate hike in March as planned and possibly only one more rate hike (even though they have signalled 3 or possibly 4). My theory is that they want to taper enough to take the air out some of the more bubbly sectors that people are speculating on like tech and crypto. I think the motivation - and not trying to be inflammatory here - is for the Democrats to be able to signal to their base that the reduced inflation before midterms because as others mentioned it hits poor and middle class voters the most. So this, combined with Ebay and all the online payment apps (PP Venmo etc) new reporting requirements, will definitely have a cooling effect on the card market in terms of the number of people buying for short term flipping. All this to say that if events play out this way there could be some real nice buying opportunities later this year for vintage and unopened that will move to the upside in an inflationary environment.
Just remember for those buying for short term gain, you have to factor in grading, shipping, 13% Ebay fees and any taxes on capital gains. Those are a lot of hurdles at the moment so I am only buying for long terms holds especially considering the economic headwinds at the moment.
I feel like the inserts and parallels from the 90’s (the O.G.‘s of inserts and parallels lol) will be the “vintage” stuff that’s collectible long term and HOF rookies….
Buyers did the same thing in the early 90's, especially with 90 Leaf baseball sets. One person who purchased a 90 Leaf Baseball set from me was hoping it would put his child through college. I advised otherwise on his anticipation, but fell on deaf ears.
But the printing presses for our currency has not subsided.
Inflation being only one aspect of future price dictation. As always the buying public/interest will determine/drive the final price basis.
You Devil
Successful card BST transactions with cbcnow, brogurt, gstarling, Bravesfan 007, and rajah 424.
I think the very highest of the high end material will see much higher frequency of items being purchased by groups w/ fractional ownership splits rather than single buyers, and prices of those will rise accordingly.
You are correct sir.
I believe that the stuff that will continue to rise regardless of whichever way the market goes will be the SP's, the SSP's, the numbered Refractor's and such. Base cards are everywhere. Go to a show and you will see the same base RC's at every other table. Even within the last 10 years, Topps and other companies seem to be putting out more and more in terms of quantity. Just compare at how many 2011 Trout Updates PSA 10's (5,500) versus Soto and Acuna PSA 10 (20K) and there is still plentiful of 2018 Topps unopened out there that people are hoarding. 2011 is still out there but not in the same quantity.
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Inflation is being seen in the cost of grading cards @ PSA + elsewhere
(($6/ea monthly specials, anyone?))
Inflation will drive prices off most things up. Look @ inflation vs. $GOLD over time.
Cards are no different.
There is another big factor and that is human population is continuing to grow. There are 331 million people in the United States today compared to 252 million in 1990.
So at the height of the junk wax era where 'everyone' was buying cards, there are now 31% more people in the U.S. today where 'everyone' is buying cards.
So right off the bat, assuming that the percentage of collectors in the population is the same from each era, then you have 31% more collectors buying Eddie Murray Rookies. 31% more collectors buying Larry Bird rookies. Etc.
That has a very real price influence.
With the advent of making cards as true investments with NFT's etc, you have another entire class of buyers that did not exist in 1990. It is no wonder why the prices have risen sharply.
The number of people are rising and the supply of vintage cards is constant.
The variable that could really make it go boom is if interest upticks more. Card prices could explode even more. Even if interest goes down a little, you are not going to get a 'baseball card depression' because the sheer numbers of people in society makes it much different than in 1990.
Worldwide purchases is another factor. The internet, the spread of sports around the world, and the increase of foreign players in the United States professional leagues, has created a legion of foreign fans and potential buyers. This market is just getting started. We have not seen this make a huge impact yet. Yet.
I would not wait too long hoping for a baseball card depression. Cards like 1983 Donruss Action All Stars? Yes. They cost the same (or less) now than they did in 1983. Cards like that are not going anywhere up in price.
High grade modern(1970-present), elite vintage HOF rookie cards, scarce vintage HOFer issues, and early cards too or higher grade later cards of HOFers, those are pretty safe to keep their value in varying degress with many factors within each of those area.
You may very well see a downtick in prices in cards where 'every dealer has one on the table' even in higher grades. That is the market within the market. There will be cards that are winners and losers in an overall VERY healthy sportscard market.
Yes, this is the definition of inflation (i.e. a general increase in prices)
I don’t think we can assume this. The card bubble burst and prices have come down but they are still generally way above pre-pandemic levels. I think they could easily keep falling even as inflation continues.
I generally cringe when people refer to cards as investments. If you’re financially secure then sure, go ahead and try to make some money on cards if that’s what you enjoy but it seems incredibly risky compared to other investments. I don’t really plan to sell any of my cards (except maybe to upgrade to nicer ones) and I don’t buy anything that would materially impact me financially if it were to become completely worthless.
Yup. Find the cards that are either truly rare, or just simply overlooked because they haven't had their time as the flavor of the month, yet.
For example, the 1978 Hostess Murray rookie card. Far more rare than Topps or OPC. I would say more attractive too. Here it is in its natural habitat. Complete Full box.
Finding a high grade one is impossible. They are often scratched, print lines, awful registration, etc...
Heck, finding any are hard enough. Ebay only has two cut Murray's and one uncut panel. That's it! Three Hostess Murray rookie cards for sale right now. THREE!
All Hostess cards, especially complete boxes are extremely tough! Very attractive too...
No wonder I could never find the Rennie stennett 1978 lmao
https://en.wikipedia.org/wiki/List_of_Major_League_Baseball_players_from_Panama
Good post. I often wonder how non-lic cards or non official release cards like this (or promos) will hold in value. I collect mma/ufc cards... sport has been around since 93 but the first lic release was 2009.... 16 yrs of un-lic cards out there that new collectors have no idea of.
That panel is Short Print panel, so yes, the Stennett is every bit as tough as well.
The Hostess cards are licensed. Be careful of the un-licensed cards from the 1990's. Those are very plentiful. I wouldn't buy too many of those.
The MMA/UFC, I am not familiar with those, so I can't comment on them.
What was once known as 'oddball' doesn't always stay 'odd'.
Think about what can move the market for each of the Murray's rookie cards.
Knowing that there are only a few Hostess Murray rookies available, only adding five motivated collectors could have a massive affect on that market. Of course, if the prices rose, then it would shake some more lose from collectors wanting to cash in...but that in turn generates excitement and upgrade opportunities. Then you have a completely new price structure and market for those.
It would take a lot more than five new collectors to move the market for his Topps rookie card.
When the government gives you free money (stimulus checks), you have more disposable income to spend on hobbies. With no more checks on the horizon, those same people might stop buying cards for awhile and may even be forced to sell the cards they bought with their free money. That will definitely drop the prices on everything.
The price of anything is determined by supply and demand. If supply increases and demand wanes, look for a major drop in sports card prices. Add a baseball lockout to the mix and you may see a huge decrease in the price of cards...
I didn't get any stimulus money of note.
I would be surprised if someone got $1,500 in stimulus money and then could all of a sudden afford a $4,000 card on top of what they are already buying.
BTW, that stimulus money is almost two years in the rear view mirror....and the market is still super strong with prices on some still going even higher. Prices on others have come down a little. Others have maintained their prices.
Easy money policy isn't going away anytime soon anyway. Those small rate hike increases the Fed is 'promising' are still small...and is now already priced into all of the markets. Also, those policies could change and reverse.
Shutdowns have been in the rear view mirror almost two years now too. That reason of 'people have nothing else to do' no longer applies and hasn't for quite some time.
PS, the buyers who could afford four figure cards actually have more money now than before/during covid.
If during covid people were buying Exxon(like they should have been) and other beaten down stocks like Cedar Fair & entertainment stocks...they will have plenty more of disposable income. Some of those stocks, including the airlines, got another beatdown during omicron....in five months those will turn into more extra disposable income. Cedar Fair already saw that jump(and will see another after they set more revenue records this summer and reinstate their hefty dividend at the end of the year). I don't wait until they announce that they are reinstating the dividend, buy it BEFORE they announce it.
Those major airline stocks saw that jump in spring of 2021(albeit premature), and that jump is coming again after Omicron has passed and the weather turns nice around the whole country.
I am eager to take that money and buy a very nice 1948 Swell Sport Thrills Jackie Robinson....the exact type of card you should be buying during this type of market where everything has gone through the roof, and the best of which will stay there until WWIII. Then if still alive after WWIII, buy those gems that came down from the ceiling as that will be your only chance to get them. If WWIII never happens then all is good and smile away.
Exxon buying opportunity is mostly gone, but the healthy dividend still makes it worthy. Now 'experts' are rating it as a buy Now, after it has already seen the jump. When it was $36 in late 2020, the experts were saying to run for the hills because it will be a $25 stock. That is when you buy. Zig when they zag. Also, study society and people because financial experts aren't usually sociological experts too....which is why during covid they were saying Exxon was going to be a $25 stock.
Sportscards are a little different than the market because you can't just wake up one day and decide to buy any card you want at market value. The supply is too finite and too controlled. So there aren't going to be wild dips on those cards. Buy the best elite zigs you can in the hot card market. Stay away from the 1990 Leaf Frank Thomas as there are too many. The zag's are the overlooked cards and soon those become high priced too.
Zig when the Zag. Zag when they Zig.
I doubt people who are getting $300+ for PSA 10 1990 Fleer Jordans are complaining when they are into them for $20 maybe
Well of course someone who purchased when $20 is fine, that is obvious.
What about all those who paid $500,$600,$800 or $1000-$1200 as they hit at one point. My guess it will sting when the card drops to below $200 which it will before 2022 ends as the PSA 10 Pop continues to rise. There must be 20 minimum at sale at any given time on eBay.
P.S. My mentioning certain cards has to do with at least one person on Instagram who purchased a bunch of 1990 Frank Thomas at the pandemic high's then bragging about how he had 200 of them.
Now that the card routinely dips below $200 I do wonder if he is exuding the same hubris?
A drop on that 200 card holding from approx $180K to $40K with plenty of room to sink to $25K seems rather steep. Sure the person could be very wealthy but from my experience at least, those with crazy money never would have been bragging about 200 1990 Frank Thomas cards in the first place. 10 times that number perhaps, but a truly wealthy braggart goes for for a 52 Mantle type card or at very least an 86 Jordan, not a card like the 90 Thomas which is less than pocket change to them.
It's the singer not the song - Peter Townshend (1972)
But they did. It's just that it wasn't these stocks they thought were undervalued were the likes of Gamestop, AMC, Bed Bath Beyond. They were certainly beaten down!
Incorrect. The last one was given out in March 2021.
And you're conveniently ignoring the recent crash of the stock market and cryptos market. Those crashes have wiped out billions in income that might have been used for buying (or investing) in sports cards. You're looking at the current economy through rose colored glasses. I'm paying at least 20% more now for my groceries than what I was paying last year. My gasoline and heating oil expenses are through the roof now. The more inflation rises, the less people will waste on hobbies like collecting sports cards.
You may be right, but I doubt it. Historically inflation has always resulted in a flight from financial assets and to hard assets; gold, cotton, fine furniture, trading cards. When you spend 20% more on your groceries, and I certainly hope no one disputes that part, the money doesn't just go away. It has to go to the Walmart executives, or the Procter & Gamble shareholders, or the guys working the slaughterhouses, or the pork farmers, or Archer Daniels Midland who sells the seeds to the farmers to grow the corn for the pigs to eat. The point is that the money goes somewhere (probably a little bit to all those people and thousands more). Those people aren't going to want to put their money in a savings account yielding 0.05% or government bonds yielding 3% when THEIR groceries are going up 20%, so they are going to buy something real that has a chance of holding its value, or even increasing.
So, even if you're going to have to sell your collectibles to buy groceries, there are going to be plenty of people who are going to be able to buy more, or at least ay more for the same fixed quantity.
Um. There is not a recent market "crash." That's a patently absurd contention.
Overall the market has to be quite a bit down from peak when you account for modern. Some of that stuff is 75% off peak, and there is mountains of it. So if viewed as an index, the index would be way off all time highs. The large cap stuff is the 89 and 90 jordan, the prism Zions etc. There are tens of millions of dollars into these cards and they are down significantly. For every Blyleven that is up 80k, there are 2k zions down 2 or 5mm
Food for thought!
The stock market hasn’t crashed, it isn’t even in correction territory. SP 500 is only 300 points off ATH’s. 1 year return is still +14%. Bitcoin is still +5% for the previous 12 months.
I do agree that inflation will hurt card prices. But anyone that has lost big in the markets is an idiot and shouldn’t have been self investing.
The Collectible Trading Card (and Comic Book) Market as well know it has pretty much only existed post the high inflation times of the late 70's that ended in the Mid 80's. These are unprecedented times in the hobby as it relates to inflation. There are plenty of opinions to be sure but no exact historical data to apply.
My guess is eventually supply and demand will reign. High Pop Junk Wax and High Pop Modern Day will likley bear the full brunt of any downturn. Of course there will always be Outliers or Hot Card of the moment that go against the grain.
BTW I see similar threads on Comic Book Forums. Here like in those forums the ones with the "most to loose" in term of HIGH POP junk, many of who got unexpectedly "fat" in the COVID bubble, are very vocal in defending current and future higher values. Regardless of they want to occur, what will occur, will occur, and there is a reason Supply and Demand may very well be the most important pillar of economics.
It's the singer not the song - Peter Townshend (1972)
Part II
People have pointed out that the basketball market has come way down. Why? 95% of the basketball card market consists of cards from 1970 to present. None of those years are rare or even remotely difficult to obtain, and almost all the cards from the 1980's to present are also easy to find in the highest grades. 1986 Fleer Michael Jordan cards are extremely available. So those cards are more similar to 1990 Leaf Frank Thomas than they are to 1948 Jackie Robinson cards.
However, very high grade Julius Erving rookies have not dropped with the rest of the basketball market because those are difficult to find.
There are currently 46 Michael Jordan Fleer RC graded a 9 on Ebay right now. I stopped counting after 46. That is a lot.
People point to the Jordan rookies that went for record prices and since lost half the money, That is a shopping problem, not a market problem(although as pointed above, Jordan rookies are too common). You can go on Ebay right now and severely overspend on even rare cards if you go in thinking you have to buy it right now and you have to meet that dealers asking price as if the card will never come up for sale again in a reasonable manner.
There are still some tougher basketball issues from the 1970's and 80's that are out there, and those will prove to be the better buys in the long run
So people making $40,000 a year who got $1,200 last march are still using that money to buy Jackie Robinson rookies at these current high prices??? That does not add up.
People who got stimulus checks in March of 2021 had to be below an income threshold and that threshold wasn't very high. Those customers aren't spending $4,000 on cards, and that was almost a year ago and that money is loooooong gone yet card prices are super strong.
The stock market didn't crash. There was a correction in some sectors. Oil and energy sectors went through that 'crash' quite well and made people a LOT of money and will continue to do so with their handsome dividend. C
edar Fair(FUN) and entertainment sectors are going up.
There were so many well established stocks that were killed by covid and most came back and are even stronger. The airlines took a hit with omicron and staff shortages, and those are buys right now.
Yeah if you were buying stocks like Peloton and Zoom, those crashed. Those were your 1988 Donruss stocks that were propped up purely from covid.
The reality is, most people with money made a lot more money by taking advantage of covid drops. Those are your card buyers.
Food prices and gasoline prices have been up for over a year...yet not a dent in the card market.
Don't comment about something you know nothing about:
Stocks prices this past week or so:
1) Paypal was $175.80 on 2/1 and it closed at $126.08 on 2/4.
2) Facebook was $323.00 on 2/2 and it closed at $237.00 on 2/4.
3) Netflix was $457.13 on 2/1 and it closed at $410.17 on 2/4.
4) Ford was $20.63 on 2/1 and it closed at $17.96 on 2/4
5) Clorox closed at $168.74 on 2/1 and it closed at $141.41 on 2/4.
I think I proved my point that you are wrong, yet again.
Dr J rookies at the peak in an 8 were 8-10K. Now In an 8 they are 3-4K. Agree on volume of 86 Jordan, however demand is strong and the Doc rookie may have taken a bigger hit since peak?
The stimulus was much broader then the cheques issues, evidenced by the debt that Canada and the US ran up.
The supply of money doubled, low rates meant money was essentially free to borrow, house prices increased (in Canada by 50% in 2 pandemic years, wtf). No one was traveling so money usually spent was diverted.
Personally I didn’t receive one stimulus check but because of WFH and low rates my house increased in value by 500k. The 10k we spend in travel every year didn’t get spent. Mortgage went down by 10k per year. I didn’t allocate any of that lift to cards but I bet many did.
That whole scenario above is reversing. End of QE, rate normalization, travel resumed. Who knows what happens to housing prices but they typically inverse rates.
I don't want it to look like I have something against 1990 Leaf Frank Thomas cards. It is a great card worth owning. I was just looking at mine the other day and it is a raw well centered beauty. Like everyone says, collect what you like and then you can't go wrong.
I just wouldn't go looking to buy one thinking it has future price growth. If I had to bet, that is an example that probably will drop at some point. There are just too dang many of them.
The 1990 Fleer Jordan....yikes...when 10's are that common your instincts should tell you something right away. Plus there are tons of those tucked in closets somewhere. Heck, I know of several raw 1986 Fleer Jordan's still tucked in closets waiting to hit the market.
There are some tougher high grade 70's and 80's basketball that are much safer buys. Erving, Bird, Magic.
There are still great buys in this hot market. Cards where it takes a little effort and patience to obtain in the condition you are acceptable with. Look within the market for those buys. Some of those are high priced already(and safe buys) and some haven't had their day in the sun' quite yet, but will.
When buying, if funds are limited, be patient. If there is a card where there bushels of 10's on Ebay on any given day, that card isn't going anywhere. Nobody will buy it and lock it into their collection. Circle back to the easy to find ones after you buy the tougher issues.
I do agree with you that recent drops in stock prices along with inflation are probably making people tighten their purse strings. Even if your portfolio is up significantly compared to a couple years ago, you would still have lost a lot of money recently (assuming you didn’t sell at the peak) and that will make a lot of people more cautious until things stabilize and head back up.
However, I don’t think there has been a “crash”. You list a bunch of stocks but a “crash” is not defined by movements in a handful of stocks. A “correction” is generally defined as a drop of 10-20 percent in a major market index (eg the S&P). I think a “crash” is a little less well defined but I think most would say it requires a drop in a major index of at least 10% and some would say at least 20% and that the drop be sudden. I believe the NASDAQ entered correction territory but I don’t think the other major indices did and I don’t believe anybody in the financial world is calling the recent drop in stock prices a “crash”
Those are individual stocks, not the “stock market”. I could show you a similar same of stocks that have big gains. But that of course wouldn’t mean anything.
You are in over your head here Tim of you think by any definition other then WSB / Reddit that the market has crashed.
Some cards will be more expensive in the future than they are today.
Some cards will be less expensive in the future than they are today.
It will all depend on the card(s) in question.
Cherrypicking 5 down stocks doesnt prove anything. The S&P is actually up 70 points over the past week.
Collecting 1970s Topps baseball wax, rack and cello packs, as well as PCGS graded Half Cents, Large Cents, Two Cent pieces and Three Cent Silver pieces.
I’m okay with this, so long as the ones I own go up and the ones I want go down.
Yes, that is the rub. Except most people desire the same elite cards and it is only a matter of affording them that keeps people from trying to obtain them.
I wish I had a taste for 1988 Donruss, that would make things easier.
I don't pretend to be a stock expert, but I do know just from the headlines that at least two of those stocks listed above released earnings reports that immediately pushed their stock prices down, which hardly makes them evidence of a crash.
There is a Patrick Mahomes card at Goldin currently bid up to $425,000 that is ending tonight....someone must have went all in with their stimulus money