People holding high end cards can typically withstand a bad economy with their cash reserves.
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I’d say that’s true for some of the people but I know a few collectors personally who put the majority of their cash into the hobby and don’t leave much for a “rainy day”. Guess we will have to wait and see to find out!
I can´t speak for Pokémon but MTG held up very well in 2008. Biggest price decrease I saw was on higher end cards (UNL/Beta Power) which was roughly like 20-25%. Sealed product did even better, with no to maybe 10% decrease for newer stuff. Really high end stuff (high grade alpha etc) was basically unaffected.
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2008 was once in a generation. 20% unemployment is an insane number lol If you cannot survive a run of the mill recession then you are over invested in collectibles and alternative investments. Recessions are buying opportunities.
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Once in a generation, I think not. Buckle your seat belts because we are in for a wild ride over the next 24 months…,
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It just feels like somethins a brewin about to begin. I can’t put my finger on what lies in store but I know what will happen because it’s all happened before…
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Or it won’t be a wild ride and it was once in generation. Just as good a chance of that being a correct statement as yours.
Fair enough. To each his own. Don’t get caught blind sided. I’m just saying…
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True, been hearing that since 2010 though…I bet so many people missed out on a bull market because of this “because it’s so good it must end bad” mentality.
It has to do with fiscal policy and not just guessing about well it’s been good so must end badly. All markets run in cycles. The 10 plus trillion dollars of stimulus printed out of thin air to prop up the world economy in 2008-?? was just a massive bandaid and did nothing to address the actual issues at hand. Yes, $10 trillion artificially propped up most markets and made it appear all is normal and healthy. In my opinion it is a just smoke and mirrors. Just my humble opinion though. Not trying to argue or convince anyone otherwise…
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Wouldn’t that be a reason for people not to sell? They already have the reason of nostalgia not to sell. So if it’s also not easy to sell or drops in value, that would be another reason to keep.
High end is the lowest probability of dropping. They have the least supply and the buyers have the most discretionary income. It’s a win win for anyone who owns the items. Either they hold value, or prices drop and you can buy more of the best stuff if it appears.
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There are many people that might be in the position to need to sell right away in a recession. Someone who just lost their job, someone who has lots of school debt and can’t find a job. They could probably use an extra $3000 to help them through their current financial situation. A lot of people aren’t buying these boxes because they love them like children–many just see it as a good investment. If times get tough for them and/or their family and they’re short on cash, they might have to sell asap even if it means doing it at a reduced rate.
The counter theory is that the big guns won’t be much affected by any sort of recession, and will always be willing to shell out lots of cash for a booster box or other big collectibles purchase no matter the market. I can see the argument from both sides. But this current growth–which went from steadily growing over the past couple years to skyrocketing in the past couple months–is not sustainable. Not saying it will shrink down to pre-skyrocket rates, but the trends are bound to normalize at some point.
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Batten down the hatches a storm is coming!
I can see all PKMN TCG items dropping! I’ve actually sold off alot of my graded singles (Gold Stars, WOTC, Crystals etc.) and kept nostalgic items. Sealed is the best place to store your money to ride the wave smoother.
Good luck collectors!
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I don’t think $3000 is the “high end” that Scott is referring to here. I’d imagine the stuff in the high hundreds to low thousands would be the most affected during a recession. Stuff in the upper echelon of PSA 10 set cards or lower tier Japanese trophy cards. There are a lot of people who have financially hyper-extended themselves to obtain these cards and will be hit worst during a recession. It’s also easy and fast to cash out one or two singles.
The cards in the $20k+ range, the owner will just be laughing through a recession. The stuff $50 and less will probably see a decrease but since it’s often an already saturated market the decrease will be relatively small compared to the stuff I described above.
Of course, this is all speculation on my part. No one here can possibly know anything for sure until (and if) it happens.
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We heard that in 2014.
And 2015.
And 2016.
And 2017.
And 2018.
And now 2019.
And yet, prices keep rising.
At some point, people just need to accept the market for what it is and stop trying to look for reasons to downplay it.
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Yup! I agree.
I said I’m going to win the lotto in 2014.
And 2015.
And 2016.
And 2017.
And 2018.
And now 2019.
Still hasn’t happened. Maybe one day I’ll be right. Maybe not.
HODL!
I don’t think there’s any significant correlation between buying habits of a tiny tcg market and a recession, the definition of a recession being lack of GDP growth for 2 consecutive quarters.
GDP growth in western countries is already low and growth is never constant.
We like to extrapolate lack of economic growth/recession with a doomsday scenario because in decades past recessions meant that every facet of a country’s economy was crippled. There’s just too much going on in our modern economies in 2019 that doesn’t stop people buying luxuries. We’re not getting up every morning to go work in factories or mines any more.
The dollar amounts that keep people buying stuff in hobbies are small so that unless you’ve lost your job you can still buy things.
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Consumer culture with a healthy dose of late-stage capitalism keeps the ball rolling as well.
Prices keep rising since there hasn’t been a recession. Recessions are an inevitable part of market cycles. Collectibles is not an immune asset class and it’s very normal for people invested in an asset class to believe something won’t negatively impact their investment.