A Good Sign

Yesturday when I visited one of my local card shops, I saw a good sign.  There are a lot of people that think the bad economy is having a big hit on the hobby, but when I walked in that door yesturday it sure didn’t look like the case to me.  The cash register up by the front door is on a table that is pretty high, and the tape reached all the way to the floor.  I asked the owner how business was going?  He replied that they are selling a ton of high-end products by the box such as 2008 Bowman Sterling football.  This bad economy doesn’t seem to be hurting the card collectors in my neighborhood.  Its great to see a card shop that has been in business for over 30 years have a register tape reach all the way to the floor, especially when its full of expensive products.  A recent report on The Cardboard Connection stated that Topps and Upper Deck both have sold out of some of their products from last year.  I’m thinking that sports card collecting provides an escape for some people from the world’s problems.  For those people that think our hobby is in the crapper, I respectfully disagree.  I think our hobby is doing good, and I can’t wait to see what surprises come next.

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The Economy and Sports Card Collecting – Guest Blogger

Figuring out what your sports cards are actually worth can be a tricky process. Depending on what source you use (Beckett, Tuff Stuff, etc.), you may or may not get a really accurate or current value. But what happens when you mix in current economic conditions such as the state of the economy that we are now facing in the United States? CardScape.net decided to pick the brain of Adam McFarland, owner of SportsLizard.com, to get his thoughts on card values, the economy, and some of the other factors involved in sports card valuation. 

CardScape: Hi Adam. First off, I’d like to thank you for taking time to share your knowledge and insight on this topic. So let’s get right to it. Does a down economy affect card values?

Adam McFarland: I think it has to. Cards are a commodoty item, an unnecessary expense, and when faced with the choice of paying the bills or buying a box of cards, the bills will always win. The hobby has really evolved to rely on the collector who spends their disposable income on cards. We’re talking hundreds of dollars a month, not just a few packs here and there. Those same collectors also drive the secondary market. The “hot” cards in the hobby, generally cost $50 or $100 or more. The demand is there because there’s someone willing to pay that much for a card pulled out of a pack. When those people diminish (as they likely will), values will definitely diminish as well. How much is anyone’s guess.

CS: During bad economic times, is there anything, in your opinion, that the sports card industry as a whole can do to help protect itself from declines in card values?

AM: It will be interesting to see how Topps, Upper Deck, Donruss, etc react to the economic downturn. Certainly they have a challenge at hand to avoid having sales dip. If big companies in the industry end up going down, it will hurt the hobby. More options are always better for the consumer.

They spend a ton of money getting signatures and memorabilia to put into cards. That’s the most obvious thing I see getting trimmed back. Less autos and relics. Hopefully they can come up with creative substitutions that will keep collectors happy. 

Personally, I think that times like this help drive innovation because it forces you to think outside the box. Maybe the result is less autos and relics like I just speculated. Maybe it’s a reduction in the number of sets released. Maybe it’s something I’m not thinking of. Either way, I think it’ll be an interesting and possibly exciting time for collectors who are open to change.

CS: Do you agree or disagree with the following statements: Card values are like stocks in the stock market. There are fluctuations in values, but over the long term, cards will increase in value.

AM: Not really. I believe that great cards – the 1952 Micky Mantle Topps Rookie, the 1986-87 Jordan Fleer Rookie, etc – will always increase in value. But value is always correlated with demand, and demand has all sorts of unique variables that drives it. Look at Roger Clemens: his image has taken a nose-dive over the past year and so has the demand for his collectibles. I don’t think that value will ever be completely restored in the collecting community, unless something unforseen happens. 

Then there’s the case of all of those cards I have sitting in my basement from 1988-2000. Most of them saw their peak in the early 90’s and then dropped off dramatically to be worth pennies on the dollar. There are so many people that have saved those cards thinking that they’ll be worth a lot some day. There will always be a far greater supply than there is demand, so I don’t see how these cards will ever have any real value no matter how long you hold on to them.

CS: It may be a bit of a stretch, but do you think there is any kind of correlation between the stock market as a whole and card values?

AM: Yes and no. I think that for the reasons I mentioned earlier there is certainly a correlation between the economy and the amount of money people spend on cards. So in that sense, values will probably always be higher in a good economy and lower in a bad one. But there are also a slew of factors that impact value that have nothing to do with the economy. In the last twenty years we’ve seen the introduction of Upper Deck, grading companies, autograph/relic cards, the internet, and of course eBay into the hobby. In my opinion, those things have had a lot more impact on card values than the economy.

CS: What would you say to the average collector that is worried that their collections are not worth the money that they’ve spent on it?

AM: I’d ask them to really think about why they collect. Almost no collector ever makes a profit from collecting sports cards. It’s a hobby. It’s almost impossible to buy and sell for profit (I say almost because I do think there are a few people out there who do it and do it well). But while most collectors love to sit around and talk about the “value” of their collection, it’s generally something that will never come into fruition. Most likely they’ll never sell. If they do sell, they’ll probably never realize that full value for their collection even in a good economy. So to most collectors I’d say focus on what you enjoy about collecting. Put less of an emphasis on the exact dollar amount of a card and more emphasis on the happiness you get from opening a pack, completing a set, interacting with the collecting community online or at shows, etc.

CS: What are some of the other factors that you feel affect card values?

AM: Most people don’t like it when I say this, but each and every card has it’s own unique value. What is the condition? Is it graded? If it’s autographed, how does the auto look? If it has a jersey in it, what part of the jersey is it? How hot is the player in question? How hot is the set from which the card comes from? Where are you trying to sell the card (hobby shop, eBay, forum, etc)? And of course, what is the overall state of the hobby and the economy? Those variables are constantly changing and usually different for every card that goes on sale. So usually you can figure out about what your card is worth, but you’ll never know for sure until you try to sell it and see what someone is willing to pay for it.

CS: Given some of the things that we’ve talked about, how does SportsLizard.com help collectors value their cards?

AM: First and foremost, I hope it helps with education. We have a Pricing Tool that allows collectors to quickly and easily get an approximate value for a card or collectible. You type in what you’re interested in valuing and we spit out a number. It’s as simple as a Google search. It works by aggregating all of the items available for sale on eBay, SportsLizard, and a bunch of other sites, and gives you a number using our formula that also factors in our sales and search data.

We’ve put a lot of work into getting it to work well, but it’s only one piece of the valuing puzzle. Right below the search box is a tutorial for how to value any collectible. That tutorial links to an article that I wrote that I feel explains a fool proof method for valuing any card or collectible. It’s the culmination of everything I’ve learned as a lifetime collector. Generally it takes less than five minutes and can be done using free tools available on the web. 

CS: What else does SportsLizard.com offer collectors?

AM: In a grand sense, I hope we offer transparency. Collectors I think are frustrated with the Beckett’s and PSA’s of the world because they have their hand in too many conflicting businesses. We’re totally independent and I try to keep the reasons we do everything we do out in the open. More specifically, our afforementioned Pricing Tool is probably the most useful thing we offer collectors. We also just launched the Collector’s Voice, a service that aggregates all of the articles from the best collecibles bloggers on the web into one common location. It allows collectors to discover new sources of card information so they don’t have to rely on what Beckett or Tuff Stuff feeds them. For anyone who sells on eBay or has a website, we allow them to syndicate their listings in our marketplace for free through our seller program. As a buyer, a quick search of our marketplace gives you results from our 20,000+ items, everything on eBay, and everything listed on Google Product Search. I think it’s the best way to quickly find the card or collectible you’re looking for.

CS: Again, thank you very much for shedding some light on these issues. It’s really been informative.

AM: Thank you for the interview!

About the author: Mike Johnson is the owner of CardScape.net. He invites sports card collectors of all types to visit CardScape.net to see what they have to offer collectors for managing, tracking, and organizing their collections online. To become a member of CardScape.net, set up a membership today:http://www.cardscape.net/join.aspx