World Colonial

On 9/6/2022 at 11:39 AM, GoldFinger1969 said:

Without taking any risk, it's not bad.  10-year Treasury today is at 3.33%.....that means you'll get close to 40% over 10 years with NO RISK.

Good investments for some -- not ALL -- of one's portfolio. 

There is risk, the depreciating currency.

My position is that the bond bull market which started in 1981 ended in 2020.  The prior bear market lasted from somewhere in the 40's (1946 I think) to 1981 during which time interest rates (long-term UST) rose seven fold.  It wasn't that big of a problem last time because debt levels were so much lower.  It's going to be a much bigger problem this time because the actual fundamentals now (including debt levels) are actually absolutely awful. 

It just never appears so at or near a market peak.  What most people call the negative fundamentals will become a lot more evident during the rising rate environment or at the peak.

On 9/5/2022 at 10:41 PM, VKurtB said:

Yes, this. A guarantee against loss now brings LOWER returns than at any point of my lifetime. Only risk brings even a reasonable return. More risk? Higher average returns, but may also bring a negative return from time to time. Time horizon matters. Those who will need funds soon need to be careful of risk. 

The real reason future returns from current market levels across all major asset classes will be "low" is because the real economy isn't actually productive enough to provide anything more, outside of a mania with perpetually increasing debt which isn't wealth.

On 9/5/2022 at 10:41 PM, VKurtB said:

Time horizon matters. Those who will need funds soon need to be careful of risk. Those who are young not only CAN handle more risk, they NEED TO. Low risk investing for young people is HORRIBLE for their futures. Just like high risk investing is horrible for me.

There is a time to buy and a time to sell.  There is a time to short and a time to cover.  There is a time to hold and a time to avoid.  Every position has its place under the sun, at one time or another.  

It's not just time horizon or age.  It's also valuation.  Valuation has mostly been completely disregarded over the last quarter century.  That's what makes recent experience a mania.

Most supposed "investing" is also speculation.  That's why I use "investing" in quotes most of the time.  It's a rationalization to take on more risk and now mostly reckless risk by somehow convincing yourself that maniacally relatively overpriced markets and "assets" are somehow "low" risk.

If I ask anyone the difference between most supposed "investing" and speculation, the only distinction they can usually give me is the holding period which isn't one at all.  It's arbitrary, as under both any profit is disproportionately or entirely the result of changes in the market price with nothing of any value created.  It's more Wall Street BS marketing.

On 9/5/2022 at 10:41 PM, VKurtB said:

And gold is just a ridiculously bad “investment” for nearly everyone, even William Devane. 

It depends upon the price.  It doesn't matter that gold just sits there as Buffet states, as this isn't tangibly different from owning serial money losing cash burn machine companies or ridiculously overpriced (supposed) blue chip companies that pay immaterial dividends and have garbage balance sheets to go with it.  That's most of the (US) stock market now and recently.

I don't think gold is a good buy at current prices.  It isn't the worst but that doesn't change it's still historically relatively expensive.

On 9/5/2022 at 9:39 PM, VKurtB said:

Everybody in “hard money” belief has been predicting Armageddon seemingly forever. I keep waiting. The fact that it didn’t all go to h—- in 2008-2009 MIGHT MEAN it will never come. Gold is down 15% off recent highs. And THIS with high inflation!

The only reason I can see for this belief is due to what you told me before, that all precedent is irrelevant.  History isn't deterministic of future events but it's indicative of how people actually act.  You told me you don't believe history is relevant.  I'm telling you this is a very long cycle.

Also, I haven't predicted "Armageddon".  That's a straw man.  My prediction is that the majority of Americans are destined to become poorer or a lot poorer over the indefinite future.

On 9/5/2022 at 9:39 PM, VKurtB said:

And THIS with high inflation! Money and credit simply may not matter anymore. The Fed simply makes up new tools as needed. Now we have a RIDICULOUS fiscal policy environment and STILL things hold together. Yes, it’s weird, but there it is. 
 

To put it succinctly, the boom bust cycle may have been rendered obsolete. The data sure looks that way. 

The only reason I can see for this belief is your concurrent belief in what I call the economic priesthood.  Practically everyone shares this version of religion because that's what it is. 

I'm telling you that the only reason for their apparent success is manic psychology. It's the only reason why QE is possible, especially for this long and to this scale.  It's also the only reason deficit spending and government debts of this magnitude and duration are possible.  

There is no wizard behind the curtain in economics or central banking any more than there is in "OZ".  There is also never something for nothing, ever.  If you disagree you disagree, but I know it's nonsense.  Central banks and governments didn't miraculously discover some "deus ex machina" to magically generate prosperity in perpetuity through "printing" (currency debasement), borrowing from the future (deficit spending), and pretending that risk has been eliminated because of politically motivated government guarantees (moral hazard).

On 9/5/2022 at 8:28 PM, VKurtB said:

Absolutely correct. As Warren Buffett has said many times, gold is ALMOST without utility. Crypto is completely without substance. 

What's your point?  I don't disagree.

On 9/5/2022 at 8:28 PM, VKurtB said:

As Mark Cuban once observed, “Everybody’s a genius in a bull market.”  How’re ya doin’ lately?

I haven't lost a cent because I stayed out during the mania.  Others will call me a fool for not participating in the biggest bubble in human history, but I don't measure my financial performance by other's opinions.  I'll still be better off than most people by not participating.  They aren't paying my bills, are they?

Contrary to what you presumably believe, I also know that we've lived through the biggest financial mania in history which is going to be followed by the biggest bust.

On 9/5/2022 at 11:39 AM, GoldFinger1969 said:

For the record, I don't consider baseball cards "investments" but collectibles like art.  Or Hummels. 

The accurate analogy is a print, not the original work.  No actually significant artwork is mass produced, like a sports card.  Prints sell for immaterial fractions compared to any expensive sports card.

Art is also subjective, but if there are any exceptions, maybe a Stradivarius violin might quality.  There is more than one of those.  Likewise for the Declaration of Independence.

On 9/5/2022 at 11:41 AM, GoldFinger1969 said:

If you mean no comparison to gold, I agree. 

Yes

Store of value for all of recorded history means something.  Tangible substance versus electronic 1s and 0s also means something.

I haven't changed my mind that gold is relatively overvalued versus many things, but it's not effectively infinitely relatively overvalued like crypto.

On 9/4/2022 at 9:22 PM, GoldFinger1969 said:

As a metal, it has value in certain mechanical and other instruments.

The primary reason gold isn't more widely used in industry is because of its price, not its lack of utility.  There are cheaper options (like silver), at least for most applications.  Being a gold hater doesn't change this fact.

I don't hate crypto, I just know that it's current value (for all 19,000+) is (almost) entirely due to the bigger asset mania.  Whatever utility it has bears no relation to the price, no government backs it to provide base demand, and it has no extended history as a store of value.  If the major asset classes (stocks, bonds, and real estate) crash but somehow crypto (presumably BTC) prices mostly remain intact, I'll admit my error.  I'm sure somebody will remind me.

There is no comparison whatsoever.

On 9/4/2022 at 2:09 PM, GoldFinger1969 said:

As with coins, you have to go UP in quality to separate price/value. 

Yes, I know but this isn't a real rarity.  It's another contrivance.  This is what I don't believe is going to last any more than with coins, not at anywhere near current price spreads.  It's more financialization and marketing, not actual collecting.

On 9/4/2022 at 2:09 PM, GoldFinger1969 said:

Stars from the 1950's and 1960's are popular:  Sandy Koufax, Ernie Banks, Roberto Clemente, Tom Seaver, Nolan Ryan.  For some reason, Willie Mays and Hank Aaron aren't -- maybe because they didn't have the number of die-hard followers once their teams moved from NYC and Milwaukee, respectively. 

Agree with your general sentiments which I think are a negative for this supposed "asset".  Yankees, Cardinals, Cubs, Red Sox, and maybe Mets have what I would describe as largest "hard core" fan bases due to cultural reasons and population.  The rest, a lot less to virtually none.

On 9/4/2022 at 2:09 PM, GoldFinger1969 said:

I grew up reading about these players from 1900 - 1960 when I was a kid flipping and collecting cards in the 1970's.  I don't think the younger generation like my young cousins (b. 1976) did.  They knew who Ruth was, but if not for the T-206, they'd never know who Honus Wagner was...or Pie Traynor....Walter Johnson....Christy Matthewson.    You might as well talk about players from the 1880's when the rules for baseball weren't like today.  Even players from the 1930's (i.e., Dizzy Dean) and beyond -- no knowledge and not enough cards.  

I extracted this part of your post, but my reply is to all of the rest.  Yes, I agree. 

This was exactly my point in my prior post.  I know all those players you named, from the sources I listed.  There is a web page I looked at this morning (maybe dated now) listing the 50 most valuable baseball cards.  I recall all the players but two whose cards are printing errors.  Yes, even Andy Pafko (50's Yankees) who I'd guess over 99% of non-Yankee fans don't know or have a reason to care.

This is the point.  It's evident there is limited to virtually no interest in most of these "classic era" (mostly pre-70's) players even now.  So, what's going to happen years later?  Some of them are still alive but most from when I started watching (1977) are already dead.

As an "investment" asset, the current price level isn't sustainable without bubble level financial conditions when the (supposed) interest is contingent on a tiny fraction of players with somewhat scarce cards with the balance being predominantly common as dirt modern mass produced.

Fractional ownership isn't going to change the long-term outcome when there is no depth of interest.  It's just another gimmick.

On 9/2/2022 at 2:27 AM, GoldFinger1969 said:

Warren Buffet thinks cryptos are bad and he's not a conspiracy theorist.

It's about intrinsic value and whether these things can deliver what they promise.

Read the prior post to which you replied.  What the prior post actually meant is that crypto provides the opportunity to transfer money from the pocket of person "A" into the pocket of person "B".  Crypto is nothing, so it can't actually generate any real wealth meaning everyone can't be better off in the aggregate.

It has value - for now - until either government takes it over and eliminates all private alternatives (my prediction) or the end of the mania reduces the value of every single one to its correct value, zero.

No, there is no long-term third option since no one has to accept it for anything which means it isn't a real currency.

On 9/4/2022 at 1:17 AM, GoldFinger1969 said:

I might want to spend speculative $$$ on a rare baseball card as opposed to Bitcoin or cryptos ! 

Which ones are actually rare, aside from printing errors?  Are any for actually prominent players especially from one of the teams with a hard core following?  Or someone hardly anyone remembers other than from the card?

I ask because presumably the best known card by far (Honus Wagner T-206) purportedly has 50-60 known though the highest graded is or seems to be an "8".

This number isn't even close to actually rare, but the distinction is that the card is the equivalent (for a baseball card) of any "famous" coin and probably better known.  I'm also assuming it was worth more than this 9.5 Mantle card back in 1991 ($50K) before everything became really inflated during the mania financial era.  

On 9/2/2022 at 1:28 PM, zadok said:

...agree no collector would pay that much for any baseball card...these collectibles at these prices almost certainly r going to speculators or consortiums...in reality i seriously doubt many baseball collectors r trying to assemble complete sets of baseball cards anymore, more of assembling groupings of potential investment cards i.e. rookie cards or HOF cards...could be wrong....

I infer (that's all it is) that there is a hard core following of overwhelmingly mostly older baseball fans who actually like this stuff.  They grew up both watching (like I did) and maybe buying Topps cards (which I did not).  But it's still speculation (not collecting) accounting for the prices, as there isn't a dimes worth of practical difference of near equivalent grade baseball cards just as there isn't on coins.

I also infer a noticeable gap between the best known players from the teams with the hardest core followings + a few players from less popular teams and everyone else.  The Yankees are definitely one with a great tradition.  But even accepting any current rationalization (which of course I do not), I don't see that this translates to baseball cards generally or HOF players who are actually obscure now.

On 9/2/2022 at 9:07 PM, GoldFinger1969 said:

It's the condition.  The MM 1952 sold was graded 9.5 out of 10.  There are supposedly three 10 cards out there that would command a premium but apparently the sellers have no interest in selling and are wealthy enough for that to not be considered a bluff or a selling strategy.

No more "hoards" either, as the 9.5 MM was found in an attic in Massachusetts about 1990.    A real fluke.

I know. It's another fake rarity as with other graded collectibles.  More marketing and financialization. 

If you look at one of the older Heritage listings of this card (who also sold this one) in slightly lower grade, anyone can see what I am talking about.  The card isn't rare until above an "8" (with 35 though presumably some duplicates) where this one is still worth a boatload of money.  That's for PSA only.

I agree with zadok's post above mine.  That was part of my prior point.  I grew up an avid baseball fan, knowing about all the classic era hall of famers from my old Baseball Encyclopedia, books, and the APBA tabletop game.

How many people really care about that at all, especially to pay big money for a card for what it actually is, as opposed to speculation? 

The Yankees are somewhat different (for now) but most (probably practically all) of these players are destined to be forgotten by the predominantly modern casual fan base who mostly know or care nothing about what I am telling you.

On 9/2/2022 at 2:35 AM, GoldFinger1969 said:

No argument, WC....but that 1952 Topps Mickey Mantle -- and I am fully willing to say it is an outlier -- went from $50,000 in 1991 to $12.6 MM today.

That's 20% a year for 31 years !! 

Now, let's see what happens to all those NBA and MLB collectibles, cards, NFTs, etc. that went from a few hundred or few thousand dollars to hundreds of thousands of dollars practically overnight.

I've already given my opinion on this one.

On 9/2/2022 at 2:35 AM, GoldFinger1969 said:

I think the speculative element in cards and collectibles can sustain price rises for authentically rare cards like the 1952 Mickey Mantle and some others, but NOT for hundreds or thousands of various cards.

From what I know, this card isn't actually rare, not even close. I don't have access to the TPG population data directly but recall it's included in Heritage auction listings (somewhat at least) which I have reviewed on occasion.

It's "rare" compared to the more recent (post late 80's) really mass produced stuff but from the Heritage listings, a lot more common versus coins that are usually considered scarce or rare.  It's even more common versus actually significant cultural objects, like Russian Imperial Faberge Easter Eggs which are each unique, some of which are presumably still worth less than $12.6MM now.

The distinction is the cultural element which baseball (or any other major sport) has to a much greater extent than coin collecting.  It's a simple as this because otherwise, no actual collector (which must include some of these buyers) would ever pay anywhere near these prices, even if they are partly buying it for financial reasons.

It also depends how far out you are looking but that's a more complicated discussion.  My belief is that the cultural appeal both for baseball and the players illustrated on these classic cards has either peaked or will in the relatively near future.  (Depends upon the player.)  So, even if I didn't think this concept (fractional ownership) is totally stupid for any collectible (which I do), I'd still never be a buyer at anything close to recent prices especially for a long-term hold.

On 9/1/2022 at 10:02 AM, GoldFinger1969 said:

I just find it interesting that all the bball cards bought in bulk -- the moderns -- from about 1988-1994 are STILL underwater as I understand it.  I remember my young cousins stockpiling them in their closets.

The rare stuff has made a spectacular comeback.  The stuff made during the bubble has not.

Might be a good lesson there for coins. 

I understand your point but the first (not only) reason for the outcome you described is that buying supposed collectibles in bulk has nothing to do with collecting, whether for coins or something else.

That's the same principle with this fractional ownership.  It's not actual collecting because it serves no recreational purpose.  It also has no economic usefulness which is why it's just another form of speculation and not investment.

In different threads here and on the PCGS forum, I have also provided my explanation for the current US collecting culture since it makes a lot more sense than the consensus perception.  It's very unpopular because it's contrary to the preferences of practically anyone with a "meaningful" financial commitment in their collection.

On 9/1/2022 at 2:58 AM, GoldFinger1969 said:

I think that is true of LOTS of threads here that many of us don't read.  This thread is no different.

OTOH, it does analyze the intersection of low-interest money, hobbies vs. investments, NFTs and baseball cards vs. coins, and other variables that affect our little niche.

The subject covered by the title of this thread is a complete farce, but apparently that escapes some people.  Not the OP for starting it, but that this concept even exists and is considered viable.  It's utterly absurd but due to recent experience is considered "normal".  

More generally, much of the discussion on this type of coin forum is about labels on plastic holders and stickers, not actually about the coin since there isn't a dime's worth of practical difference much of the time from a collecting standpoint.  But then, I suppose that makes total sense too.

On 8/30/2022 at 8:26 AM, zadok said:

...observation: i see locally many circulated raw barber n morgan coins still being sold individually at auction, seems lots of collectors still filling holes in their whitman albums, also to a lesser degree indian cents...i personally go to these auctions mostly to buy silver bullion coins n then refine but will buy circ raw semi n key date morgans have certified n flip...on the counterfeits, two schools of thoughts...one, go for the higher dollar coins n max out %...two, go for common date lower dollar coins n volume, lower % but less scrutiny....

Good to know.  The only ones I have followed are online with firms that are better known.  There are (or were) many auctions on iCollector which I infer are similar to your description, but I have never looked or participated.

On 8/29/2022 at 2:20 PM, GoldFinger1969 said:

Exactly....if I was a teenager buying inexpensive Whitman-type coins, no great risk.  I buy commemoratives, Saints, other gold coins, Morgans, and other silver coins.  Greater risk of being burned for me without TPG certification.

No one to my knowledge ever bought Whitman-type coins at auction except as bulk lots and these would not have been graded individually.

I believe the time period RWB is referring to was after certification started, like maybe 20 years ago or near it.  Then yes, because certification was already established.

Before certification (about 1986), it all goes back to the inflated price level directly connected with the widespread adoption of TPG.  Prices were a lot lower back then, so the financial risk was a lot less.  Same goes for counterfeits, as it's a lot less profitable to counterfeit lower priced coins, most of the time.  Exceptions exist but not many.

So basically, sort of a circular causality.  Buyers today prefer to buy higher priced coins graded but it's the grading culture which substantially inflates the price level through financialization.  Some Morgans have been expensive to most collectors my entire life and Saints since the mid to late 70's too due to the metal content.  The other coins you identified, in isolation or not at all.

On 8/29/2022 at 9:30 AM, GoldFinger1969 said:

True, but I'm not sure I have the time or inclination to learn grading...go to seminars...spend the time reading....etc.  Even if I educated myself, I might get caught buying a counterfeit coin that costs me thousands.

That's mostly because of what you buy and the inflated price level.  The risks you describe were mostly much lower or not a consideration at all, depending upon what the bidder was trying to buy.

This is another coin, where based upon your preference, I'd buy graded and just crack it out of the holder.  I would only buy an ungraded one after a personal inspection (mine or someone I knew), not from an image. 

It's a really common coin, so I see no need to buy it as you are describing here.

I'm not worried about someone hacking a coin auction site.  I can't imagine anyone would care to do that.  If anything is going to happen which I consider unethical, it would be the auction house awarding the winning bid at the winning bidder's maximum (or near it) instead of one increment above the runner up.

I only buy occasionally now due to my interests, but now or previously, if I really want a coin, I make sure to try to bid during the auction. Nothing above nominal prices on eBay for a long time.

Otherwise, I just place my maximum bid in advance and wait to see the result. If I was buying the coins most collectors do, that's what I would every time.  It's not like another one won't become available, soon or very soon.

All modern US proofs and NCLT are widgets.  There is no reason for any US modern base metal proof to sell for even the slab fee or, except for a few like the 95-W, for ASE to sell for more than minimal premiums to silver spot.

So, while I understand submitters do not like the changed economics, the pricing structure almost (but not quite) makes sense for collectors.

On 8/26/2022 at 1:33 PM, gmarguli said:

The business strike ASE were absolutely collected early on. I remember submitting a lot of the 1988 and 1989 SAE business strikes. Used to sell a bunch on Teletrade until that bastion of hypocrisy would (kind of) no longer take them on consignment.

NGC stopped grading moderns supposedly because Albanese thought they were overpriced in the marketplace and people would get burned. 

Thanks, wasn't aware of it.

In my last post, I was referring to circulating coinage but now your post makes sense.

On 8/26/2022 at 1:22 PM, gmarguli said:

Then Albanese intentionally tried to kill the modern market and ended up only hurting NGC and helping give PCGS the market edge.

Then Hall killed the modern market because he was clueless.

How?

Going by the image, I don't think it should straight grade.  This is apart from the rim damage would I agree should disqualify it.  Whether it would or not is another consideration.

Given how common 1921 Peace dollars are, I'd think one looking like this wouldn't be "market acceptable".  But this opinion might because I'm not used to seeing circulated examples.

If it were a coin in my series, I'd guess 50-50 even though anything I collect is hundreds of times scarcer.

On 8/25/2022 at 10:10 PM, GoldFinger1969 said:

You wonder, if with all the pent-up demand for classic coins when they first opened for business, if the 2 TPGSs would have even been able to handle modern coins individually submitted, let alone mass submittances like you see today with dealers sending in hundreds or thousands at a time.

I don't think the prior post is referring to NCLT which accounts for the lopsided majority of "modern".  I've never heard of anyone collecting "business strike" ASE as a collectible until later, only buying it for the metal content.  Outside of the Chinese Panda and Mexican Libertad, it's my recollection the other NCLT weren't struck until later either.

By "modern", referring to US moderns.  There were no registry sets at the time (came later but forgot exactly when) which presumably means NGC might have thought hardly anyone would ever submit this coinage.  Volume only became "meaningful" beginning in 1999 with the introduction of SQ and later series.