@itsvegasdave “The Sports Card Market Will Collapse”

[premium1981]

Originally Posted by joe73

Do the people who don't believe there's a bubble believe prices will continue to increase if there's an MLB work stoppage a year from now?

Do you see where you went wrong with your question?

Since you may not be clear on what this "bubble" is, let me help explain. Bubbles are a term used for super hot markets that seem too good to be true. For us, its the sports card industry. So you believe this "bubble" will pop and everyone will sell off their Luka's if MLB has a work stoppage? Not sure I see the link between the two.

[KhalDrogo]

Originally Posted by joe73

Do the people who don't believe there's a bubble believe prices will continue to increase if there's an MLB work stoppage a year from now?

You can’t be serious. We’ve been arguing for days and you don’t even understand what a bubble is?

[Publius]

Originally Posted by rwperu34

This question has me convinced that you don't even know what a bubble is.

Originally Posted by premium1981

Do you see where you went wrong with your question?

Since you may not be clear on what this "bubble" is, let me help explain. Bubbles are a term used for super hot markets that seem too good to be true. For us, its the sports card industry. So you believe this "bubble" will pop and everyone will sell off their Luka's if MLB has a work stoppage? Not sure I see the link between the two.

Originally Posted by KhalDrogo

You can’t be serious. We’ve been arguing for days and you don’t even understand what a bubble is?

Perhaps the question could have been better articulated but joe73's question is reasonable and could be answered respectfully without piling on and implying that he is ignorant of something. If we are in the midst of a "revolution" as KhalDrogo stated a few pages back then the market is undergoing fundamental changes that do not support the bubble thesis and past experience (including the study of asset bubbles) may not be helpful in projecting the future. So in that state of the world what effect will a work stoppage have on prices? No effect? Minor correction? Collapse? Something else. Pretty simple.

[2010GBPackers]

Originally Posted by rwperu34

I'm glad you reposted because I meant to respond last night, but lost the post and didn't want to scroll back 15 pages to find it.

I think you have to separate out the overall market, seasonality, and player performance.

I don't follow basketball at all (aside from the ultra disappointing Sun Devils), but I would suspect that based on the calendar you are well past the peak for prices. In baseball you kind of hit a plateau on opening day at which point the money starts shifting from the below expectation performers to above expectation performers. Then shortly after the all star break prices start to broadly fall, with only the MVP/CYA/ROY candidates and maybe post season heroes gaining. Then they hit bottom in early November and plateau there until they start rising again, which used to be mid January but is now like Nov. 2.

I imagine it's a similar cycle in basketball that has to be in the plateau phase, if not the start of the lull. As discussed in this thread, Luka and Giannis are both playing below expectation which would put downward pressure on their prices.

That's the problem I have with using one active players as a barometer for the market. Heck, even Mike Trout is going to have a bad year some day and his cards will fall (see: Pujols). That's why for my Price Index I use a broad base of ~70 active players.

I think about players like Pujols and Derrick Rose. If their peak years were anywhere from 2017-current, we're talking Trout and Luka money being poured into those guys. And while both still have a good following and one is a clear 1st ballot HOF, investors would have taken a bath on them. And that's best case scenario. Truth is, unless a player turns out to be Mantle, Aaron, Jeter, Jordan, Brady, etc. prices won't hold. Once these new investors start to understand that, I think we see a sharp decline. Which is why I think we're seeing an unbelievable run on Jordan's rookies right now. So for current players, the only real locks are players like Trout, Kershaw, Verlander, Rodgers, Mahomes, Lebron, Curry....I'm trying to think of others but those are the only ones I can think of with multiple MVP's/Cy Young's and Championships. Even players like Giannis with 2 MVP's will continue to fall without another accolade.

That's just me though

[premium1981]

Originally Posted by Publius

Perhaps the question could have been better articulated but joe73's question is reasonable and could be answered respectfully without piling on and implying that he is ignorant of something.

Ignorant gets a bad wrap, but it simple means someone doesn't know any better. That fits here.

The question shows that the person asking does not understand what they are arguing. The "bubble" has no correlation to any potential work stoppage. They are completely detached from each other. Want me to prove it? Answer this question for me....

In what market would baseball cards not soften under any strike or work stoppage? The hobby could be at all time lows, and a strike would make it sink further. That is common sense. It has nothing to do with the topic at hand. So to use that as a point to prove we are in a bubble is nonsense.

PS. And for the record I am in agreement that we are in a bubble. No market can sustain what our hobby is going through long-term. But the wrong questions are being asked. Here are mine:

A) Where is the peak going to be? My guess is this summer, maybe early fall.

B) Once the peak is reached, how fast do we start going down? My guess is slowly. It isn't going to be a stock market crash scenario. It will be individuals getting burned on these crazy high prices and some money will start to leave one person at a time.

C) Where will the bottom be after correcting? My guess will be back to where we were about a year ago. Strong market, but a reasonable market. We aren't going into fire-sale levels any time soon.

[cardsin47]

Originally Posted by premium1981

Where will the bottom be after correcting? My guess will be back to where we were about a year ago. Strong market, but a reasonable market. We aren't going into fire-sale levels any time soon.

This puts you and I on the same page. Bubbles aren’t just one big size or pop —- they can let out a little air and maintain that new size - they don’t have to violently and quickly explode under their own weight and stretched mass!

[MoreToppsPlease]

Originally Posted by Publius

Perhaps the question could have been better articulated but joe73's question is reasonable and could be answered respectfully without piling on and implying that he is ignorant of something. If we are in the midst of a "revolution" as KhalDrogo stated a few pages back then the market is undergoing fundamental changes that do not support the bubble thesis and past experience (including the study of asset bubbles) may not be helpful in projecting the future. So in that state of the world what effect will a work stoppage have on prices? No effect? Minor correction? Collapse? Something else. Pretty simple.

Mob mentality.

[SupermanBrandon]

Originally Posted by MoreToppsPlease

Mob mentality.

Choir boy. Noted!


Sent from my iPhone using Tapatalk

[NYBBFAN]

Something very important that hasn’t been mentioned: negative interest rates.

Investors have to park their money somewhere. Sports cards are the best way to do that, especially compared to art, where everything is a 1/1 and is subjective.

Wealthy individuals and investor groups have to make a return on their capital, so what better way to do it at the present time? If you feel stock valuations are stretched beyond what’s reasonable, how else do you make money in today’s environment?

[premium1981]

Originally Posted by MoreToppsPlease

Mob mentality.

Because a few people agree with each other? Doesn't that make you a mini mob for agreeing with the guy you quoted? Do you live in a glass house by chance?

[monkeymcgee]

Originally Posted by NYBBFAN

Something very important that hasn’t been mentioned: negative interest rates.

Investors have to park their money somewhere. Sports cards are the best way to do that, especially compared to art, where everything is a 1/1 and is subjective.

Wealthy individuals and investor groups have to make a return on their capital, so what better way to do it at the present time? If you feel stock valuations are stretched beyond what’s reasonable, how else do you make money in today’s environment?

Some people fail to get a perspective beyond cardboard. This is absolutely a factor. They also evaluate cards like they do other investments and are less concerned with short-term trends in performance and more about who has the potential to be iconic. Their gap between playing good and hobby good is much wider than the traditional sports cards buyers.

[ThoseBackPages]

Originally Posted by premium1981

Because a few people agree with each other? Doesn't that make you a mini mob for agreeing with the guy you quoted? Do you live in a glass house by chance?

his house is covered in regret and tin foil

[k13]

Originally Posted by 2010GBPackers

I think about players like Pujols and Derrick Rose. If their peak years were anywhere from 2017-current, we're talking Trout and Luka money being poured into those guys. And while both still have a good following and one is a clear 1st ballot HOF, investors would have taken a bath on them. And that's best case scenario. Truth is, unless a player turns out to be Mantle, Aaron, Jeter, Jordan, Brady, etc. prices won't hold. Once these new investors start to understand that, I think we see a sharp decline. Which is why I think we're seeing an unbelievable run on Jordan's rookies right now. So for current players, the only real locks are players like Trout, Kershaw, Verlander, Rodgers, Mahomes, Lebron, Curry....I'm trying to think of others but those are the only ones I can think of with multiple MVP's/Cy Young's and Championships. Even players like Giannis with 2 MVP's will continue to fall without another accolade.

That's just me though

Mahomes is a lock...

He only played a few years, so much can still change.

Trout can fade too as he'll have a decline after age of 30 and no championship most likely.

No one is a lock.

Maybe Jordan will be found a child molester.

[ThoseBackPages]

Originally Posted by k13

Mahomes is a lock...

He only played a few years, so much can still change.

Trout can fade too as he'll have a decline after age of 30 and no championship most likely.

No one is a lock.

Maybe Jordan will be found a child molester.

Tomorrow Never Knows

[MikawlBBC]

Originally Posted by k13

Mahomes is a lock...

He only played a few years, so much can still change.

Trout can fade too as he'll have a decline after age of 30 and no championship most likely.

No one is a lock.

Maybe Jordan will be found a child molester.

+Freaky career ending injuries (Bo Jackson)

[JeremyNick]

Originally Posted by NYBBFAN

Something very important that hasn’t been mentioned: negative interest rates.

Investors have to park their money somewhere. Sports cards are the best way to do that, especially compared to art, where everything is a 1/1 and is subjective.

Wealthy individuals and investor groups have to make a return on their capital, so what better way to do it at the present time? If you feel stock valuations are stretched beyond what’s reasonable, how else do you make money in today’s environment?

This is where I double down on my “this is going to end bad and abruptly” thinking.

Sports cards (namely modern) are highly volatile. They were long before modern cards became a serious investment option. Since the 2018 rapid rise and definitely since the Luka, Giannis, Mahomes, etc money started pouring in, everything is going up. The big names haven’t seen any real dip.

We all know that is not normal and not sustainable in the hobby. We know Tork has a small chance of becoming Trout. We know Andrew Luck had an incredibly bright future. Losing money is a part of collecting cards. This new wave of money hasn’t seen or experienced that normalcy yet. What happens when there is a normal, but expected drop for one of these big money guys? How does this new wave of $$$ focused investors react? Will that trigger a huge sell off, will investors decide that they don’t really are a grasp of sports cards and pull out?

Modern sports cards are not comparable to art. It’s a completely different dynamic that is namely dependent on a players performance, health, team market and achievements. Where we see so much new money being pumped into players whose careers are just starting, we know that only a small percentage of those players maintain that early trajectory long term. That is not comparable to art in any way.

[shayscards79]

Originally Posted by JeremyNick

This is where I double down on my “this is going to end bad and abruptly” thinking.

Sports cards (namely modern) are highly volatile. They were long before modern cards became a serious investment option. Since the 2018 rapid rise and definitely since the Luka, Giannis, Mahomes, etc money started pouring in, everything is going up. The big names haven’t seen any real dip.

We all know that is not normal and not sustainable in the hobby. We know Tork has a small chance of becoming Trout. We know Andrew Luck had an incredibly bright future. Losing money is a part of collecting cards. This new wave of money hasn’t seen or experienced that normalcy yet. What happens when there is a normal, but expected drop for one of these big money guys? How does this new wave of $$$ focused investors react? Will that trigger a huge sell off, will investors decide that they don’t really are a grasp of sports cards and pull out?

Modern sports cards are not comparable to art. It’s a completely different dynamic that is namely dependent on a players performance, health, team market and achievements. Where we see so much new money being pumped into players whose careers are just starting, we know that only a small percentage of those players maintain that early trajectory long term. That is not comparable to art in any way.

The first drop in value will come when this pandemic is finally over. People are going to be going on trips again, going to sporting events, going to concerts, eating out more, pumping more gas in their cars, etc.

Sure some big money guys will keep pumping and dumping no matter what... but the average guy won't be spending as much. I don't think any massive bubble will pop but it will start deflating when everything goes back to normal.

[KhalDrogo]

Originally Posted by JeremyNick

Sports cards (namely modern) are highly volatile. They were long before modern cards became a serious investment option. Since the 2018 rapid rise and definitely since the Luka, Giannis, Mahomes, etc money started pouring in, everything is going up. The big names haven’t seen any real dip.

What’s a “real dip” to you? All of those guys have seen periods where there stuff has taken significant hits. Giannis Prizm was over $7k in August, and is less than half that now. Mahomes had the injury in fall 2019 and his Prizm went from $1600 to $700 in December. Luka Prizm went from a peak of $2150 in the bubble to $1300 in the fall before the MVP front runner storyline got picked up. If these aren’t “real dips” I don’t know what is.

[JeremyNick]

Originally Posted by KhalDrogo

What’s a “real dip” to you? All of those guys have seen periods where there stuff has taken significant hits. Giannis Prizm was over $7k in August, and is less than half that now. Mahomes had the injury in fall 2019 and his Prizm went from $1600 to $700 in December. Luka Prizm went from a peak of $2150 in the bubble to $1300 in the fall before the MVP front runner storyline got picked up. If these aren’t “real dips” I don’t know what is.

I should have used the word tank and not dip. You ignored the entirety of my post and honed in on a single word.

I’m talking about the normalcy of a player being highly valued to see that value drop significantly and sustain or completely evaporate.

[monkeymcgee]

Originally Posted by JeremyNick

I should have used the word tank and not dip. You ignored the entirety of my post and honed in on a single word.

I’m talking about the normalcy of a player being highly valued to see that value drop significantly and sustain or completely evaporate.

People who invest are familiar with this risk

[JeremyNick]

Originally Posted by monkeymcgee

People who invest are familiar with this risk

What risk specifically.

Injury, bad market, no championships, complete failure?

Those are the normal risk involved in sports cards that I was talking about. Are those normal investment risks compared to art?

[monkeymcgee]

Originally Posted by JeremyNick

What risk specifically.

Injury, bad market, no championships, complete failure?

Those are the normal risk involved in sports cards that I was talking about. Are those normal investment risks compared to art?

They are familiar with the risk of an investment losing value. And that such risk is more likely with more speculative investments.

[JeremyNick]

Originally Posted by monkeymcgee

They are familiar with the risk of an investment losing value. And that such risk is more likely with more speculative investments.

So the risk and market dynamics between art and sports cards are the same?

[Chris P]

Originally Posted by MoreToppsPlease

Mob mentality.

You act like Joe doesn't bring it on himself..hes not some innocent victim in all this bickering

[rngrdanny22]

Originally Posted by JeremyNick

So the risk and market dynamics between art and sports cards are the same?

I think you're arguing just to argue. Nowhere did he allude that they are one in the same.

People who "invest" in sports cards know what the risks in doing so are. They are the same risks that you listed out just two posts ago. Granted, I would say those are more for the modern card market, and less so for vintage.