I was too young to be particularly cognizant of the collectibles market 10 years ago during the market crash (and the years following) - but I was curious how the market for graded cards, sealed product, etc. in pokemon followed the greater general recession era. Recessions and economic downturns are perfectly normal parts of the economic cycle, but again - as I was not around really during the era I just wanted to hear what people’s perceptions were of the era.
Obviously the pokemon tcg player base was much tinier (As seen by nationals being a couple hundred individuals IE and masters division alone this year expected to hit 2,000 at the US internats this year) then, just as there was less product, and less collectors. Did more product enter the market during this era as people tried to sell stuff to deal with economic needs?
I am partly curious about peoples anecdotal experiences of the era and partly curious to hear what people think would happen if say we had a recession/downturn tomorrow. Obviously I don’t expect anything to happen tomorrow, but again - economic downturns are perfectly natural and it goes without saying one will eventually happen and an upturn will of course eventually happen just as all cycles go. In a theoretical recession scenario now with more collectors, higher valued items, and more players in the player base currently how much would prices of stuff theoretically decrease (would they even for the rarest of stuff, medium rare stuff, etc.?) substantially or not at all? I assume in such a scenario both supply would increase and demand would decrease in such a period.
Well Gold increases in value during a recession as it’s the oldest form of currency and supply has always been low.
Pokémon cards are not gold nor a currency so I would assume in a global recession their worth will decrease, as demand would be low. Course there are lots of factors at work if a recession were to be localised. If the card was in short supply and demand was high it might increase comparatively to the localised currency.
In recessions discretionary products fall the hardest, and collectibles are deep in the discretionary segment. Their prices should fall.
Fyi gold isn’t as recession proof as people make it out to be, it does fall during recessions too. With the exception of customer staple products like Colgate and Johnson & Johnson most asset classes will drop in value
I’d say cards will still sell via Buy it Now, but just not as fast. However if there are mass auctions like what PWCC is doing at the moment, spending power would be lower and hence lower closing prices.
In sum, BIN listings won’t get affected too much as people who are able to spend will purchase them, but not as often. However auction listings will get impacted pretty hard as 0.99 no reserve auctions are sales forced on to the consumers, with the smaller purchasing power, prices will close lower too.
Always have some cash reserve ready in the case of mass auctions to get certain collection pieces for cheap or just to make a quick 30% profit a few months down the road. With the quantity that PWCC is auctioning since last year’s May, I doubt there will be more months with 500+ auction listings.
BIN listings will adjust as a secondary reaction to lower realized auction prices (over time), so they will be affected to the extent that auctions are affected, but only after some time passes and auctions continue to churn out lower prices (consistent lower prices indicate that market price has shifted, severely cutting the odds of selling a card at a much higher BIN price… basically to 0%).
The only exception is if the card doesn’t show up often and someone really wants it and/or believes that it won’t be around later (or will have appreciated in value the next time it appears).
There’s a decrease in prices for sure, but there’s just less activity as a whole on the market. There would not necessarily be that much of an increase in supply except for individuals that are having a VERY bad time and they have to liquidate everything just to stay afloat as they lost their job/business or can’t pay their rent/mortgage. As bad as 2008 was, it effected maybe 10-15% of the population if even that. Now if we were talking 1930 era Great Depression kind of thing it would be a totally different story so unless that happens, I wouldn’t worry too much.
And just to piggy-back off this (and stress this point), that’s why everyone’s advice on here, if you’re collecting cards as a pure hobby, is to only put in money that you’re okay with losing/investing away for years of time, since yes prices will decrease during a recession, but should pick right back up as the economy pulls itself back out. Unless Pokemon is your bread and butter, you should be good.
Non essentials/luxury items always go down in recessions, there are always people that overextended their finances and need to liquidate when times get tough. People get conservative with their spending in time of fear and uncertainty and sellers that are relying on sales income will lower prices and accept lower margins to turn over items and stay afloat.
That said some things might not see a huge decline because there are people that are fairly insulated depending on the severity of the recession and see economic downturns as an opportunity to buy if things they’re targeting drop.