Hey! Thanks for your question,
No I have not considered the DN multiplier for the overall market 
Sure, I donât doubt youâre right about the basic investment principles and your 10-point apple analogy. I just doubt the universal applicability of a financialized investment perspective on something which is almost entirely driven by nostalgia, irrational attachment, and arbitrary value. Itâs why many people, including myself, will recommend that the best way to invest in Pokemon cards is to collect them.
Iâm not saying that 20-21 growth is sustainable. As I said, I agree that we are likely heading for a rather significant retrace from 2021 highs, in fact weâre already there. Where we disagree is that you somehow think that weâre going to go back to 2018-19 prices, which I think is incredibly unlikely if not impossible.
Weâve seen this boom-and-retrace cycle multiple times in Pokemon, from the gold star bubble to the original no rarity hype period, to 1st ed base rises in 2016-17, and then again in 2020-21. Itâs pretty clear what happens, things enter meteoric rises, they peter out at the top, come down, but almost never reach the prices they were at before the period of rises. 2020-21 featured more craziness, but I remember exact threads like this in 2016-17 decrying âflippersâ as those who would ruin the hobby and take things to the ground because they only cared about money. Turns out it didnât happen,
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Honestly, I even have a hard time envisioning EX Series boxes retracing to 2018 prices. I donât know 2018 prices off the top of my head because I wasnât actively following the EX Series box market at that point, but I do know late 2019 prices because thatâs when I sold my boxes â my Ruby box for $4k and my Power Keepers box for $3k.
Those boxes are now worth approximately $8k each. Do I think itâs possible that these boxes retrace back to late 2019 prices? Absolutely. But letâs assume 2018 prices on those boxes were approximately $1.5k ea, which is probably pretty close to accurate. Do I think the boxes could retrace to those prices? Honestly, I have a pretty hard time imagining it. Despite the growth % being extremely (and perhaps unhealthily) high, I just canât envision these boxes getting back to under $2k-$3k each. Perhaps Iâm helplessly blinded by my love for that era .
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I see.
Alright so
Regarding market motivators:
So, I agree, nostalgia, irrational attachment, and arbitrary value, then ago only 2/3 are more seen in pokemon than other speculative vehicles. Arbitrary values are common with most speculative assets, housing is prime example
Regarding retrace back into 2018/2019 prices:
Is the reason because the new serious investors and overall GDP increase within the US? What are some other factors that you are looking at that will prevent us from hitting 18/19 prices again?
Regarding Boom & Retrace cycles:
So, when you have an entire sector rise fast and experience unsustainable growth YoY thatâs a bit different then lets say, one company or one set of cards (these gold stars). I take it that a few years ago everyone was buying up all the gold stars and the price started skyrocketing right? Well, thatâs normal price goes up, comes back down then levels out to natural growth YoY (as long as the market doesnât entirely collapse or something catastrophic happens).
What is different is when you have an entire market or economy do the that same thing. A rise in gold star cards and the bust is a lot different than an entire economy running into a rough patch. You canât really compare it to 2008 either because the amount of interest was not the same and I have a feeling the level of exposure to the public was small. So, it probably wonât have the same reaction as today, if an economic issue occurred because the growth has been insane.
Regarding Flippers & Market Collapse:
I donât think a market collapse is going to happen, all I see is prices dropping back to pre pandemic frenzies, then leveling out as long as the US economy doesnât go totally south.
My view on flippers is that no matter what they are bad for your market no matter the industry. They are just bad. EDIT: Just wanted to clarify, nothing against the normal âflipperâ what I am against is scalpers buying every single box at a store harassing the store people then trying to sell for 4x the price while taking pics of the product in their car in the store parking lot.
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Wow⌠that would have a been an amazing investment opp, $500 â $8k?? Yeah this is just mind numbing, idk where else you could see this outside of normal investing, maybe lucky with a few one off stocks that 10x or something, but even those are extremely rare. To get lucky on. Maybe crypto but thatâs just glorified gambling haha.
Here is what I know,
If you have an asset class, and large large amounts of new interest/volume pour into the market skyrocketing prices in a short period. The most common way to maintain is to maintain that level of interest/volume in the market. Otherwise, if those interest/volume leaves, liquidity dies down and at that point, itâs kind of just back to the old collectors selling to collectors. Only so many times you can sell the same shadowless PSA 10 zard to the same person. BUT if you had insane interest/volume then maybe you have 10,000 people who want to buy that same zard.
Without interest you a hard time maintaining growth, If the boxes were 1.5k back in 2018 as the highs before the pandemic shenanigans then I can see 1.5-2k being retested as a support.
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You are wrong
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Hey!
I very well could be wrong; however, if we think that the majority in this game are not in it for the profit and just collect and dont care about lighting money on fire, well. My only question is why did we see such large amount of growth? If collectors behave the same, then why not irrational growth YoY constantly?
Without interest you a hard time maintaining growth, If the boxes were 1.5k back in 2018 as the highs before the pandemic shenanigans then I can see 1.5-2k being retested as a support.
If your view is that âpandemic shenanigansâ were the source of the price spike, wouldnât the support be equivalent to late 2019 prices? After all, the pandemic hit in early 2020. Iâm curious why youâre using 2018 prices as the reference.
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I think your definition of a collector is flawed
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Using Late 19/early 20 prices, you could but it would be safer to go back a bit further before everything really started kicking off to perform your projections. I personally wouldnât use data right at the same time before high market instability. That is just me though, im sure other people might.
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Could you elaborate on how my view is wrong? Also, this entire post isnât about collectors, itâs about investors.
I think you failing to realize that someone cant be both is the problem
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If pokemon was a stock now, would you have a sell off now so when the prices tank to pre-covid you can stonk again?
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Well, you could but this entire post is purely for investment purposes. Collectors are willing to eat losses and be happy with eating them. A investor never wants losses
Conflict of interest between the two. Not impossible but will be hard to balance properly.
Please pm me. Iâll buy all your cards for 2018 prices.
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If pokemon was a stock, you wouldnât see a sell off right now or in the immediate future, short term future, possibly 6months-1year from now. Although normally stocks are first hit when it comes FED behavior, then a year later consumer goods gets hit. Thats why the bull whip effect is so dangerous and the FED is trying to figure out if they want to less on the financial tightening or not. Its a mind_explosion.jpg scenario lol
I donât have enough knowledge to even try to fathom entire local economical behavior.
You canât say this though when youâre trying to analyze the entire market. Itâs like saying âletâs analyze the housing market but forget about all those people who want to buy houses to live in, theyâre too complicated.â
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You are trying to apply the wrong concepts to an asset class (collectibles) that has little fundamental utility when compared to other assets like stocks, bonds, housing, etc.
At the end of the day, people collect Pokemon cards because they like them. As the years have gone by, more people like particular Pokemon cards such as ex-series or Japanese promo cards. Therefore their price have gone up and wonât retrace back down too much since the enjoyment of those cards will probably not go away.
Supply of these cards are fixed, while demand continues to rise over time. Collectibles across the board for things like MTG cards, artwork, and Pokemon cards have risen over time because of this, regardless of pandemic effects. The pandemic just accelerated it because people had more time to figure out or rediscover what they like.
tl;dr prices are where they are at because people collect what they like.
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Which comment was this in reply to? For some reason I canât see the history, can you quote the part?
I think long term you are right, short term all reactions are similar across speculative assets. Prices will retrace, hit support, then as long as overall market is healthy price will go up YoY on healthy rates comparatively to previous years, as long as similar level of outsider interest/volume/demand is present.
Maybe I am wrong, and prices arenât going to dip back down into 2018 highs and everything goes on like normal. It could be totally happen.
Once again, I am not talking about collectors I am talking about short term Investors. We have to apply two different types of psychology with the two.
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