are there parallels between the modern US coin market, and the baseball card bubble?
Doogy
Posts: 4,508 ✭
The following excerpt is from a Seattleweekly.com, and it seems like bears a striking resembelance to the market for modern US coins:
"That baseball fans weren't even aware enough of baseball cards to look for them at the ballpark speaks to just how far the hobby had fallen from its zenith in the late 1980s. Back then, baseball cards were the darlings of the collectibles industry. A 1987 Time magazine story proclaimed them an "outlandish but sound investment," and even suggested that trading cards were more lucrative than the stock market. The hobby's popularity led to an explosion of card makers and card sets, which confused collectors and flooded the market with cards that it couldn't absorb. The irrational exuberance of the times drove up the cost of entry, disillusioning traditional collectors and pricing out kids. "I felt so bad when I was selling a pack of three cards for $18," says Keith, who also owns a card shop in Montlake (Washington).
The gains in value that cards could make attracted a new kind of collector: the investor. "That was good in terms of getting foot traffic in the store, but it promoted a culture of people looking at it just from a money standpoint," says Pete Brown, owner of Brown's Cooperstown card shop in Fremont. "What's going to go up, when it'd pay off . . . it was a mini–stock market."
Those who weren't hoarding unopened cases were tearing into boxes in search of rare inserts. Almost as quickly as they had bought in, investors realized that their returns couldn't continue, and people who didn't cash out were left with cards worth pennies on the dollar"
"That baseball fans weren't even aware enough of baseball cards to look for them at the ballpark speaks to just how far the hobby had fallen from its zenith in the late 1980s. Back then, baseball cards were the darlings of the collectibles industry. A 1987 Time magazine story proclaimed them an "outlandish but sound investment," and even suggested that trading cards were more lucrative than the stock market. The hobby's popularity led to an explosion of card makers and card sets, which confused collectors and flooded the market with cards that it couldn't absorb. The irrational exuberance of the times drove up the cost of entry, disillusioning traditional collectors and pricing out kids. "I felt so bad when I was selling a pack of three cards for $18," says Keith, who also owns a card shop in Montlake (Washington).
The gains in value that cards could make attracted a new kind of collector: the investor. "That was good in terms of getting foot traffic in the store, but it promoted a culture of people looking at it just from a money standpoint," says Pete Brown, owner of Brown's Cooperstown card shop in Fremont. "What's going to go up, when it'd pay off . . . it was a mini–stock market."
Those who weren't hoarding unopened cases were tearing into boxes in search of rare inserts. Almost as quickly as they had bought in, investors realized that their returns couldn't continue, and people who didn't cash out were left with cards worth pennies on the dollar"
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Yes, I think there is definately a parallel, and the Mint's "Special" commemoratives, Proof Sets, Siver Proof Sets, ect. will probably have little value in the future. The "70" craze will die off when people realize that a "cheap" "69" is basically identicle. Then again, as long as the Registry thrives, the inflated prices could last......
Anyways, it's hard to really say there's a bubble. I mean, coins have been collected for hundreds of years. Baseball cards, well, it is just ink and paper...but...what do I know? I guess that's also why I like my coins with a little bit of silver in them. :-)
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on top of the other good points mentioned
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This was the OP:
Last night, I read a reprint of an article in the Numismatist from 1992 penned bt Bowers entitled, "What are we doing to ourselves?"
In the article, he discusses the glorious state of baseball card collecting and contrasts it with the gloomy state of affairs in coin collecting at that time. He lists five points at which baseball card collecting was proficient and coin collecting was quite weak. We all know what happened soon thereafter; baseball card collecting tanked.
In 1992, I was already mostly out of baseball cards. I spent 1985-1989 or so heavily involved in cards and the next couple years unwinding a good portion of my collection. I was not doing coins during any of that period.
I see now concerning similarities between baseball card collecting in 1989 and coin collecting in 2004, as well as some stark differences. Here is some food for thought:
1. Baseball card collectors in the 1980's were very much focused on the "moderns", the active and future players. People would speculate who would be the next Willie Mays or Bob Gibson and take sizable "positions" in these players cards. If a player had a good week or month, his rookie card good rise in price appreciably in a short period of time. To me, there are some striking similarities between these modern baseball cards and modern coins of today.
2. More advanced collectors, after the thrill of getting a few Dwight Gooden or Darryl Strawberry rookies, would often move on to more "classic" cards. I formed a "type set" of Roberto Clemente cards (one from each year, 1956-1972--I never bought the "key date" 1955 rookie card--too expensive--and still is). I also purchased some rookie cards/key dates of hall of famers like Willie Stargell and Rod Carew. I was also able to obtain non-key cards of Ted Williams, Sandy Koufax, and Mickey Mantle. Relative to the "modern" cards, these seemed way too cheap.
3. Many baseball card issues became a one-way market. Even when there was a lot of demand for collectors to buy certain issues (Don Mattingly rookies come to mind), the dealers were not that interested in taking them back on trade, let alone for cash. When I start to hear that it is tough to get dealers to buy popular coins, I will know the end of this cycle is near.
4. Near the peak of the baseball card cycle, there was a lot of supply. The established companies were pumping out new cards like crazy, there were retro sets (a reprint issue of the 1953 Topps set, for example) and new companies with new gimmicks every year. We will have a a "retro" coin next year, the new "buffalo nickel", but fortunately, there is only one US Mint to produce new coins.
5. One point that Bowers brought up was that baseball cards were successful because you could go to shops and shows and readily discuss the game and the hobby with friendly dealers and fellow collectors. Coin shows are not quite as friendly and shops are non-existent. The internet and forums like this certainly take the place of the friendly neighborhood coin shop.
6. All of the press about baseball cards was positive and promotional at the time of its boom, while the press about coin collecting was negative including whining about the sagging market, hand-wringing overgrading issues, concern for counterfeits, etc.). I would say that the numismatic press presently is balanced with a good mix of both the positive (price and demand boom) and the negative (grading issues, ebay rip-offs, etc.).
I disposed of most of my collection by 1992 but still have some cards that I will keep no matter what their monetary value because they have some sentimental value to me. Cards like a Cal Ripken card that he signed for me (for free) in person, my complete Mazeroski and Stargell sets and my almost complete Clemente set (can you guess where I am from?), my Honus Wagner (not THE Honus Wagner), Pie Traynor, Ralph Kiner, etc. cards, and so on.
I apologize for the rambling post but thought it would be an interesting discussion point.
<< <i>I'm not a card collector, but tell me what happenned to what I term the "antique" cards - say pre WW2, and the cigarette cards? Did those prices collapse like Beanie Babies as well? >>
Higher grade old cards still have alot of value, but they just don't sell on ebay. I've seen some on ebay with a certain BIN price that is a fair askin price and they sit and sit for months.
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#1 1951 Bowman Los Angeles Rams Team Set
#2 1980 Topps Los Angeles Rams Team Set
#8 (and climbing) 1972 Topps Los Angeles Rams Team Set
<< <i>Nearly five years ago, I started a [L=thread] We will have a a "retro" coin next year, the new "buffalo nickel" >>
do wuh? Come again? Is this true? When did this happen and what are the details? Sorry to derail the subject. Just want a quick reply on this.
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#1 1951 Bowman Los Angeles Rams Team Set
#2 1980 Topps Los Angeles Rams Team Set
#8 (and climbing) 1972 Topps Los Angeles Rams Team Set
<< <i>
<< <i>Nearly five years ago, I started a [L=thread] We will have a a "retro" coin next year, the new "buffalo nickel" >>
do wuh? Come again? Is this true? When did this happen and what are the details? Sorry to derail the subject. Just want a quick reply on this. >>
stamps, to beanie babies, to baseball cards and you'll see that the damage
was total. Oh sure, an inverted Jenny still sells for a lot of money and a Ho-
nus Wagner tobacco card still brings prety good money but nothing is safe.
When the NCLT market collapses as so many seem so much to desire just
don't be surprised if it doesn't take 1804 dollars and walking liberties with
it.
<< <i>
<< <i>
<< <i>Nearly five years ago, I started a [L=thread] We will have a a "retro" coin next year, the new "buffalo nickel" >>
do wuh? Come again? Is this true? When did this happen and what are the details? Sorry to derail the subject. Just want a quick reply on this. >>
>>
Oh. a thread started 5 years ago. My bad
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#1 1951 Bowman Los Angeles Rams Team Set
#2 1980 Topps Los Angeles Rams Team Set
#8 (and climbing) 1972 Topps Los Angeles Rams Team Set
Edit > Sorry cladking didn't see your post.
<< <i>Yes, I think there is definately a parallel, and the Mint's "Special" commemoratives, Proof Sets, Siver Proof Sets, ect. will probably have little value in the future. The "70" craze will die off when people realize that a "cheap" "69" is basically identicle. Then again, as long as the Registry thrives, the inflated prices could last...... >>
The more common post 1982 Mint commemoratives draw little numismatic interest but are quite popular amongst those buying gold at modest premiums over melt.
https://www.pcgs.com/setregistry/gold/liberty-head-2-1-gold-major-sets/liberty-head-2-1-gold-basic-set-circulation-strikes-1840-1907-cac/alltimeset/268163
But if you insist that the cards are rubbish (pre-1975 as that's all I deal in), please send them to me and I'll happily reimburse your shipping and throw in a gift basket of edilble goodies for the holiday season of your choosing.
Funny thing is that a while ago, I was contacted by a board member who had a pile of old cards he thought were trash, He netted out a shade over 40K by the time we were done.
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I don't think anyone is questioning the viability of the market for pre- 1970's cards. It seems all directed at the crap that came out in the '80's.
Personal experience though: In that boom time I went to an estate auction that had a bunch of cards from the 50 and 60's. I went for the coins but had a card pricing book with me. most of them had values between $5 & $10 so I thought I was doing great when I bought a few pages of the for about a buck a card. Needless to say, I barely broke even when I sold them.
And I thought Redbook prices were screwy.
A collector only wants one of each date and MM for each series.
In the late '50s and early '60s, everyone and his brother was buying 10 rolls of
every coin. They ended up cashing them in at the bank for face.
Same thing with stamps 10 years earlier. Sheets of stamps hoarded by the speculators.
They finally had to sell them at 10% LESS than face.
What did all these "get rich quick" investors? in was that there wasn't a market for them
because collectors had their one coin already.
Nobody wanted a collection of rolls of coins or sheets of stamps.
I accurately predicted the numistmatic crash of 1964 & '65.
I sold rolls of circulated Jeffersons, the 5 key dates, just before it happened.
I could have bought them back for less than half what I got for them.
I know not many of you are old enough to remember those days.
I'll bet you could read about them with a Google search.
Been there. Seen that.
JT
I collect all 20th century series except gold including those series that ended there.