Stock market + alt assets plunging = ??? to your collecting or "investing"

[pewe]

A couple years ago, on the pre-market of the first day of the stock market rout generated by COVID, I posted a similar thread: https://www.blowoutforums.com/showpo...71&postcount=1

At that time we saw a short term deep weakening, and then the Fed + Congress started pumping tons of $$$ into the pockets of every day Americans. Who turned around and immediately started "investing" those $$ into meme stocks, crypto, and other alt assets like sports cards.

Fast forward to today, and the Fed + Congress are wrangling with how to take all that stimulus out of the system, as they face down persistent high inflation. And we have the Fed rising rates into the mouth of a Bear - a highly unusual, and perhaps scary market setup. Remember in rosier downturn setups (i.e., no inflation to also fight) of 2000 and 2007 that it took nearly 3 years and 1.5 years to hit their bottom at -49% and -57% in the S&P vs our current downturn of 18% in the S&P since the Jan 3 peak.

The riskiest stock market assets, like tech stocks, are down tremendously from their peak in Nov '21. Crypto is falling off a cliff, Coinbase trading volume down 40% and warned in the unlikely event of bankruptcy that customers' coins could be seized by creditors, and with Tether becoming unpegged it even is making some question whether Bitcoin could drop a lot more in the rush for an exit that has taken down many other high flying assets (you get the terror some are spreading).

Where do we go from here in sports cards?

If you are a collector, are you pausing, hoping for cheaper days ahead? Or shrugging and ignoring?

If you are an "investor" do you have diamond hands? Or are you starting to wonder if paper hands would be better, and are going to cash (or plan to)?

Originally Posted by pewe

Interesting morning with US stock markets to open as much as 3% down on global supply chain disruption caused by corona virus. We’ve had some discussion about the effect of “investors” on the hobby. They seem to have driven card prices to significant new highs over the last few years.

If you are in it for the hobby and your PC, but also like to feel like you can at least get your $$ back if you sold... how is a period of economic uncertainly going to affect your participation? Will it slow your purchases? Will you shrug and say “so-what”?

BTW my bigger fear: I sure hope we don’t see disruptions to games if we do have wider outbreaks in the US. Looks like the emerging issues in Italy is shutting down lots of public events.




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[smanzari]

I know when downturns happen, everyone yells "the sky is falling" but my eBay has NEVER been busier. I'm guessing people are still buying cards, just focusing on low-end ones

[pewe]

Originally Posted by smanzari

I know when downturns happen, everyone yells "the sky is falling" but my eBay has NEVER been busier. I'm guessing people are still buying cards, just focusing on low-end ones

I guess two points: last time I posted like this, there was about ~1 month of buying opportunity. I snagged a bunch of stuff at ~50% discount.

Second consideration: the stock market is a leading indicator, so end consumers haven't been hit, yet. But with pressure like this: https://finance.yahoo.com/news/why-t...100055174.html It will really start to bite the small guys, and not just the big ones who are taking it in the shorts right now.

The real question for folks on here... do you plan for a chilly future? or do you just plow ahead and ignore?

If you plan for the chilly future, what do you recommend?

[smanzari]

Originally Posted by pewe

I guess two points: last time I posted like this, there was about ~1 month of buying opportunity. I snagged a bunch of stuff at ~50% discount.

Second consideration: the stock market is a leading indicator, so end consumers haven't been hit, yet. But with pressure like this: https://finance.yahoo.com/news/why-t...100055174.html It will really start to bite the small guys, and not just the big ones who are taking it in the shorts right now.

The real question for folks on here... do you plan for a chilly future? or do you just plow ahead and ignore?

If you plan for the chilly future, what do you recommend?

I think if you're planning for a chilly future, you need to just focus on what you like. Overpaying for something that is PC is so much more different than over paying for a flip.

I do want to point out, there's always a chance that the Card Market IS NOT impacted; two entirely different "markets," can almost get to the point on Blue Collar v. White Collar. HOWEVER, the Card Market and the Crypto Market seem to have a beta close to "1" and that one is DUMPING (so that's a pipe dream)

As historical market data shows us, "Blue Chip" Vintage is never a bad choice.

[49erRCCollector]

Originally Posted by smanzari

I know when downturns happen, everyone yells "the sky is falling" but my eBay has NEVER been busier. I'm guessing people are still buying cards, just focusing on low-end ones

eBay has definitely been busier. During the pandemic it was a struggle for me to keep anything up because people were buying everything, as I posted. Rusty nail? SOLD. Old sock? SOLD. It reminded me of 1998-1999 where I sold everything I put up there for a while.

Not as much now... things have definitely cooled.

I have no idea what that means for the future, but it has cooled.

[rwperu34]

Originally Posted by smanzari

I know when downturns happen, everyone yells "the sky is falling" but my eBay has NEVER been busier. I'm guessing people are still buying cards, just focusing on low-end ones

This is the only comment I read, but felt it worthy to respond before I reply to the OP.

I have experienced the exact opposite! My mid and high end cards are selling strong, it is the low dollar cards that are missing.

[Silent George]

I'm personally on a near pause as my life transitions, which has nothing to do with the current economic client (except that I admit I would probably have gotten an Al Kaline on card auto in the $30 range, except now it costs over $60 to fill up my car.)

just want to say that per usual I was reading this post without the author, and had this strange feeling that seldom happens on this website of "this guy knows what he's talking about" and of course, it's Pewe.

[pewe]

Originally Posted by Silent George

I'm personally on a near pause as my life transitions, which has nothing to do with the current economic client (except that I admit I would probably have gotten an Al Kaline on card auto in the $30 range, except now it costs over $60 to fill up my car.)

just want to say that per usual I was reading this post without the author, and had this strange feeling that seldom happens on this website of "this guy knows what he's talking about" and of course, it's Pewe.

thanks @silentgeorge! coming from you that really means something

[GlenSepper]

Originally Posted by Silent George

I'm personally on a near pause as my life transitions, which has nothing to do with the current economic client (except that I admit I would probably have gotten an Al Kaline on card auto in the $30 range, except now it costs over $60 to fill up my car.)

just want to say that per usual I was reading this post without the author, and had this strange feeling that seldom happens on this website of "this guy knows what he's talking about" and of course, it's Pewe.

Clearly a SME when it comes to the economy/finance.

[notoriousrmb]

Everything is cyclical.

Buy the dip.

In a year we might be talking about booms again.

If you card collecting/selling habits are influenced by the stock market, maybe its time to separate your disposable income from your investments.

[Biohazarddfl]

I'm just buying everything I like. I would bet that the stuff I buy right now is going down in value, but if it's something I may not see again any time soon, I'm still grabbing it. If it's a player I think will outperform, I'm grabbing it. If it's something I think I will be able to find abundantly, I'm letting it drop. I'm also staying the hell away from crypto and buying stocks that have fallen too far, like Uber for example.

I am not a financial advisor and please do not take this as advice.

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[MiamiMarlinsFan]

Interesting question. While I only use “fun money” for this, and view cards has a hobby more so than an investment, I don’t like throwing away my money and try my best to make somewhat smart additions to by collection (while still collecting what I enjoy).

The direct and tangible impact this has had on my buying habits is this: I still feel perfectly fine buying nice parallels and refractors of current establish stars (HOF? Who knows, way too soon for any of our current hobby darlings), but I’ve backed off of the prospect game a lot. Back in the day, I could go see the Braves top prospect (Austin Riley) look good in a spring training game, go home and buy his 1st Bowman auto raw for $40. Now a completely unproven prospect like Kahlil Watson’s 1st Bowman autos go for over $300. It’s just not fun to have to take such a big risk.

Over the long-term, we’ve seen time and time again that nice cards from big names can weather the short-term bumps along the road. But the risk of putting massive amounts of money into a Jasson, a Watson, or any other flavor of the week prospect has gotten exponentially bigger over the last three years to the point where you’re just better off waiting to see if they succeed or not before jumping in (knowing you’ll pay a higher price), since you’ll spend more going around trying to chase kids with a extremely high failure rate.

[willcurt76]

I'm definitely hoping for cheaper days ahead, but at the same time shrugging and ignoring. I've always been somewhat frugal with my spending and try to find the best price on a particular card I'm looking to buy.

[mallowciraptor]

An upcoming October wedding will likely keep most of my spending limited this summer, but anything I do buy will be PC-focused or some cards for sets I'm trying to complete.

Wouldn't mind seeing wax prices start to plummet from the high prices we're seeing now, even if I'm not buying them at the moment.

[MiamiMarlinsFan]

Originally Posted by mallowciraptor

An upcoming October wedding will likely keep most of my spending limited this summer, but anything I do buy will be PC-focused or some cards for sets I'm trying to complete.

Wouldn't mind seeing wax prices start to plummet from the high prices we're seeing now, even if I'm not buying them at the moment.

Unfortunately, you’ll never see wax drop to an affordable price point for a solo buyer as long as breakers are a thing. Since they spread out their costs over multiple buyers, they can afford to spend more than just an average guy looking for something to rip. It’s a bummer for sure.

[pewe]

Originally Posted by MiamiMarlinsFan

Unfortunately, you’ll never see wax drop to an affordable price point for a solo buyer as long as breakers are a thing. Since they spread out their costs over multiple buyers, they can afford to spend more than just an average guy looking for something to rip. It’s a bummer for sure.

How long will the breakers have demand if their customers lost all their $$ in crypto and meme stocks? And lost their job / can't get the cool new job they quit their current job to go get?

[hermanotarjeta]

As a collector I am for sure pausing and waiting for wax prices to come down so I can enjoy opening again at a reasonable price. The product will still be there in the future.

As an investor, I have sold 99% over the last year. Doesn’t make sense to buy at moon prices.

Having extra cash for the hobby is never a bad idea as I see prices dropping further from the pandemic pump.

[MiamiMarlinsFan]

Originally Posted by pewe

How long will the breakers have demand if their customers lost all their $$ in crypto and meme stocks? And lost their job / can't get the cool new job they quit their current job to go get?

Will they take a hit? Definitely. Enough so that Average Joe can easily and cheaply buy some 2022 Topps Chrome boxes? I don’t see it happening. Like I said, their business model just allows them to spend more on boxes/cases. The financial hit would have to be so bad that it completely removes breakers from the market. I see Fanatics removing them by force sooner then I see the market naturally removing them.

[BonVoyage]

Originally Posted by pewe

How long will the breakers have demand if their customers lost all their $$ in crypto and meme stocks? And lost their job / can't get the cool new job they quit their current job to go get?

People still gamble (which is essentially what breaking is) during recessions.

[pewe]

Originally Posted by BonVoyage

People still gamble (which is essentially what breaking is) during recessions.

Some academic research on the topic, if you are interested: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3501160/

I do wonder if there is a double whammy this time, because folks were gambling with winnings from the stimulus inflating meme stocks and alt assets. And that accumulated wealth has officially turned negative, now.

[OneSickDegen]

Originally Posted by pewe

How long will the breakers have demand if their customers lost all their $$ in crypto and meme stocks? And lost their job / can't get the cool new job they quit their current job to go get?

Degens gonnna degen. The spirit is strong with them and they will find a way to grind up another stab.

[mallowciraptor]

Originally Posted by MiamiMarlinsFan

Unfortunately, you’ll never see wax drop to an affordable price point for a solo buyer as long as breakers are a thing. Since they spread out their costs over multiple buyers, they can afford to spend more than just an average guy looking for something to rip. It’s a bummer for sure.

I guess plummet was probably the wrong word to use, as that will never happen. But at least to a level that is somewhat closer to the MSRP (certainly not to the 500%+ mark-up we're seeing currently). Even that might be wishful thinking though...

[towerymt]

I had an idea for a doom thread: what's the one card you hope shows up in a no-reserve auction at the lowest point we've seen in years? It's probably gotta be something really rare, or priced above where you would have wanted to pay in the recent past. I have a few cards in mind.

Otherwise, I'm buying less these days and trying to thin out whats left of my PSA returns of players I don't collect. Good news today, might be able to fire sale some Eloys in about 2-3 weeks.

[captionwanker]

this thread is a lot different from the doom and gloom in the basketball section

[pewe]

Originally Posted by captionwanker

this thread is a lot different from the doom and gloom in the basketball section

Oh?!? What's going on there?

I expect there are more hobbyists in the baseball card world than most other sports... I wonder if that is the reason?