Jay Leno's advice on collecting Original Comic Art 2 2

[PhilipB2k17]

Well, actually, no. It's his advice on collecting cars. But, most of you will think this sounds familiar!

https://www.msn.com/en-us/money/markets/jay-leno-has-3-rules-for-buying-collector-cars-that-will-go-up-in-value/ar-AAwyd0g?ocid=spartandhp

"If you're just trying to buy cars for investment purposes, you'll always be disappointed because you'll never make enough money," he continues. "But if you buy something that you like, if it goes down in value, then at least you still like it."

[vodou]

1 hour ago, PhilipB2k17 said:

"... if it goes down in value, then at least you still like it."

Which is sorta hs because nobody feels the same about something when it goes down in value. It's human nature. That's why most buy the highs and sell the lows.

[pemart1966]

1 hour ago, PhilipB2k17 said:

Well, actually, no. It's his advice on collecting cars. But, most of you will think this sounds familiar!

https://www.msn.com/en-us/money/markets/jay-leno-has-3-rules-for-buying-collector-cars-that-will-go-up-in-value/ar-AAwyd0g?ocid=spartandhp

"If you're just trying to buy cars for investment purposes, you'll always be disappointed because you'll never make enough money," he continues. "But if you buy something that you like, if it goes down in value, then at least you still like it."

I think that Jay can afford to have a few cars go down in value....

[JadeGiant]

6 hours ago, vodou said:

Which is sorta hs because nobody feels the same about something when it goes down in value. It's human nature. That's why most buy the highs and sell the lows.

I don't know. I take this approach to buying art that I really like. I have a number of pieces that I know I paid at/above market and I did not care because it was still worth more to me. It is a tough argument as one can only really tell when faced with a big loss on a piece. I haven't had that experience yet. 

[Pete Marino]

I would say this hobby would shrink a lot if people were expecting the value to go down after purchase.

I am not a big spender in this hobby, so I've never spent a dollar that would hurt my "real life", so comic art undergoes a 50% correction tomorrow I'll be jumping for joy as i can now afford things that were previously out of reach.

[vodou]

2 hours ago, JadeGiant said:

I don't know. I take this approach to buying art that I really like. I have a number of pieces that I know I paid at/above market and I did not care because it was still worth more to me. It is a tough argument as one can only really tell when faced with a big loss on a piece. I haven't had that experience yet. 

I hope this doesn't come off as excessively argumentative, it's not meant as such, but - overpaying justified by the euphoria of a raging bull market is my point. Just as much as the deep depression that sets in when a market is crashing and half your value evaporates overnight. Or in the course of a year. When nobody will step up to buy at any price, forget about getting out for "what you paid". Just because we haven't seen that in comic art doesn't mean we won't. Or rather certain segments won't, let's say, just as in fine art not everything drops the same way at the same time either. Sometimes it's Impressionists, other times Old Masters or Post-War, Minimalism, etc.

If you don't sell: you're never faced with "a big loss on a piece". I think, Dave, that you are not much of a seller correct? So you really wouldn't know one way or the other re: realized gains/losses.

Oft-touted Wall Street trading advice is "sell your losers, let your winners run", and yet most do the exact opposite, booking the profits (early, for euphoria boost) and "forgetting" about the dogs, sitting on them too long and then having a much larger loss later (even if it's only a "loss" in the relative sense that everything else moved up much faster). The psychology at work there is going to be the same in art, it's been well shown to be present already in fine art. Winners are sold and losers...are left to heirs to deal with, when cost basis and stick-price-memory no longer matter. Estate pickers are all too happy to buy until the sun sets at no reserve all must go to sell the property type sales. This happens so much, I mean folks make a living at it (the picking I mean).

I think a true "big loss" would be if the owner of ASM 328 cover tried to sell it next HA. Does anybody think it would net even $400k back to the seller? If not - that's a quarter mil loss, over (now) a fair number of years too!

[vodou]

2 hours ago, Pete Marino said:

I would say this hobby would shrink a lot if people were expecting the value to go down after purchase.

I would say this hobby would shrink a lot if zero percent rate promotions disappeared.

[pemart1966]

2 hours ago, Pete Marino said:

I would say this hobby would shrink a lot if people were expecting the value to go down after purchase.

I am not a big spender in this hobby, so I've never spent a dollar that would hurt my "real life", so comic art undergoes a 50% correction tomorrow I'll be jumping for joy as i can now afford things that were previously out of reach.

I suspect that, just like you, a lot of people would be buying as opposed to leaving the hobby...

[vodou]

3 hours ago, Pete Marino said:

I would say this hobby would shrink a lot if people were expecting the value to go down after purchase.

I am not a big spender in this hobby, so I've never spent a dollar that would hurt my "real life", so comic art undergoes a 50% correction tomorrow I'll be jumping for joy as i can now afford things that were previously out of reach.

 

27 minutes ago, pemart1966 said:

I suspect that, just like you, a lot of people would be buying as opposed to leaving the hobby...

This assumes that what is causing the 50% correction isn't also causing you and many others to be unemployed or otherwise unable to economically justify buying. Hence the 50% correction. Sort of like how very few were buying the bottom or even near the bottom of the 2008/09 market rout. Why? Because most everyone was too busy trying to not be homeless

[Pete Marino]

2 hours ago, vodou said:

 

This assumes that what is causing the 50% correction isn't also causing you and many others to be unemployed or otherwise unable to economically justify buying. Hence the 50% correction. Sort of like how very few were buying the bottom or even near the bottom of the 2008/09 market rout. Why? Because most everyone was too busy trying to not be homeless

Of course, if I'm in such dire straits that my choice is food and shelter for my children or art, I'll choose to feed my kids.

But I'd also like to think that I'm not living on the precipice of disaster with my life.

[Lucky Baru]

If you are chasing the dollars then what you place value in isn't the art.  You value money.  That's the end all be all in your world.  You won't be happy unless your horde of green paper or digital dollars and cents increases. 

Edited May 3, 2018 by Lucky Baru

[Rick2you2]

 

12 hours ago, vodou said:

I would say this hobby would shrink a lot if zero percent rate promotions disappeared.

I don't sell at all, so I'm curious what you mean. Are you saying there really is that much speculative buying of OA?

[vodou]

13 minutes ago, Rick2you2 said:

I don't sell at all, so I'm curious what you mean. Are you saying there really is that much speculative buying of OA?

Yes.

This is a subject covered here in many threads over many years from any number of directions: what is a bubble, is comic art in a bubble, if so does that even matter (if you love it, who cares about price/value), what happens in a correction instead of collapse, who's buying/selling in what quantities in these cases, where's the "new" money coming from if there is even any, and more. All to the general annoyance of Lucky Baru, who nonetheless can't help but pop his head in and comment anyway. I suspect he's not concerned because he doesn't have much at stake.

Is new money coming in and where is it coming from, imo the most important questions to be answered. If, as some suspect, most of the money coming "into" comic art is upgrade recycling from recently minted CGC billionaires (lol, more like millionaires) and the maturation of the hobby widening the gap between commons and stars, then that's not "new" money at all. Is it?

There are certainly a number of reasons why the thirty-five year ascent of the comic art price curve is much steeper than other hobbies, average incomes, even above-average incomes (widening gaps not withstanding), stock market indices, real estate, just about any other hobby or pure investment vehicles out there (except Topps #352 in PSA Mint it seems!) One of them, imho, is thirty-five years of cheap money. Another is the broadening of awareness, community, and ease of doing business that twenty-five years of widespread internet use has brought us but also almost the entire world. The first is reversing, and the second may have already reached full saturation. In both cases, the explosive aspect that drove price expansion (intentionally not using growth here) has probably exhausted itself and present day speculators and old-timers that are now bagholders are more and more being left with identifying (hoping for?) expansion in greater fools as the exit strategy.

Anyway there is lots of interesting reading out there on what happens when annuity schemes dependent on a low rate environment blow up in a rising (worse: rapidly rising) rate market. If that's something you think may be pertinent...have at it.

[JadeGiant]

15 hours ago, vodou said:

I hope this doesn't come off as excessively argumentative, it's not meant as such, but - overpaying justified by the euphoria of a raging bull market is my point. Just as much as the deep depression that sets in when a market is crashing and half your value evaporates overnight. Or in the course of a year. When nobody will step up to buy at any price, forget about getting out for "what you paid". Just because we haven't seen that in comic art doesn't mean we won't. Or rather certain segments won't, let's say, just as in fine art not everything drops the same way at the same time either. Sometimes it's Impressionists, other times Old Masters or Post-War, Minimalism, etc.

If you don't sell: you're never faced with "a big loss on a piece". I think, Dave, that you are not much of a seller correct? So you really wouldn't know one way or the other re: realized gains/losses.

Oft-touted Wall Street trading advice is "sell your losers, let your winners run", and yet most do the exact opposite, booking the profits (early, for euphoria boost) and "forgetting" about the dogs, sitting on them too long and then having a much larger loss later (even if it's only a "loss" in the relative sense that everything else moved up much faster). The psychology at work there is going to be the same in art, it's been well shown to be present already in fine art. Winners are sold and losers...are left to heirs to deal with, when cost basis and stick-price-memory no longer matter. Estate pickers are all too happy to buy until the sun sets at no reserve all must go to sell the property type sales. This happens so much, I mean folks make a living at it (the picking I mean).

I think a true "big loss" would be if the owner of ASM 328 cover tried to sell it next HA. Does anybody think it would net even $400k back to the seller? If not - that's a quarter mil loss, over (now) a fair number of years too!

Correct. I am NOT a seller and have only traded off a couple pieces but nothing that was extremely significant to me. So I can’t say for sure how I would feel if a $5K piece sold for $2K etc. but I can say that I considered this very carefully when I made larger (in my scope) purchases and did consider how I would feel if I took a large loss. It did not factor much into the purchase equation for me personally as some art bought put me in a negative position right away due to overpaying. If I sold off art at significant losses, I would not like it but I can also say that I would look at it as the cost of owning/enjoying the art while in my possession.

 

I think this comes down to an individual collecting philosophy and where your priorities are toward how you acquire art. If investment/return, etc. is higher on the totem pole than personal enjoyment/appreciation, then you will look at what you buy very differently then someone who buys for personal enjoyment as a primary driver. I got burned in the comic and sports card game when I started buying with return as a significant factor and I vowed never to enter into a hobby this way again so I look at what I collect these days very differently.

[Lucky Baru]

Someone's warm and fuzzy feelings got harshed and decided to go on the personal attack.  My five year old does the same thing when the obvious is pointed out to him and he doesn't like it.  Kind of expected from a 5 year old.

Edited May 3, 2018 by Lucky Baru

[PhilipB2k17]

I look at it this way. I think of owning these pieces of art as an aesthetic experience, rather than an investment. I get the "value" of being able to look at and enjoy the art from time to time, at my leisure and convenience. That, and knowing I'm the only one who possess it, gives me psychological satisfaction. I compare it to going on a nice vacation, or eating a very nice meal. Once you spend the money on those things, it is gone. And all you have are the memories and the experiences.

Now, imagine a world where you could "re-sell" your past vacations and meals (bare with me, its a thought experiment, not to be taken literally). Sometimes you may get back a larger amount of money than you spent on them originally. Sometimes you break even. Or, sometimes, you take a "loss." But, in each case, you still have the "value" of the experience and the memories.

Nobody thinks of "taking a loss" on a vacation or a nice meal. They are not paying for an object of value, per se. They are paying for the experience. The same is true, I think, with most collectors of Original Art. Or, art of any kind, for that matter.

[Lucky Baru]

25 minutes ago, PhilipB2k17 said:

I look at it this way. I think of owning these pieces of art as an aesthetic experience, rather than an investment. I get the "value" of being able to look at and enjoy the art from time to time, at my leisure and convenience. That, and knowing I'm the only one who possess it, gives me psychological satisfaction. I compare it to going on a nice vacation, or eating a very nice meal. Once you spend the money on those things, it is gone. And all you have are the memories and the experiences.

Now, imagine a world where you could "re-sell" your past vacations and meals (bare with me, its a thought experiment, not to be taken literally). Sometimes you may get back a larger amount of money than you spent on them originally. Sometimes you break even. Or, sometimes, you take a "loss." But, in each case, you still have the "value" of the experience and the memories.

Nobody thinks of "taking a loss" on a vacation or a nice meal. They are not paying for an object of value, per se. They are paying for the experience. The same is true, I think, with most collectors of Original Art. Or, art of any kind, for that matter.

+1, my favorite pages aren't ones I've spent the most money on, nor are they the ones that other collectors I know would stop when looking at a portfolio and make a comment about.  They are the ones that have memories attached to them.  I have a commission that there isn't enough money on the planet to buy from me.  It is of my son turned into a comic book hero that the artist and I created together, hangs framed in my son's room, and will NEVER increase in value nor be sold it for what it cost me.  Until I typed that it has never occurred to me to even look at it that way.

It looks like Jay Leno doesn't look at his collection through the following spectrum:

 

 

Edited May 3, 2018 by Lucky Baru

[vodou]

52 minutes ago, Lucky Baru said:

Someone's warm and fuzzy feelings got harshed and decided to go on the personal attack.  My five year old does the same thing when the obvious is pointed out to him and he doesn't like it.  Kind of expected from a 5 year old.

Third sentence makes you guilty of the first sentence. Takes one to know one? (and be wrong anyway)

If you don't have five, six, seven figures in cost basis (nevermind present value) in the "hobby" then while your opinion on big picture hobby economics may be valid (of course), it's going to be immaterial to those that do.

Do you?

Last you posted, that I remember, about art you'd recently bought and were excited about was some (nice, no doubt) Matt Wagner early oughts Batman panel pages. Of the $150-$300 variety. Nothing warm, fuzzy, harshed or otherwise about that or my statement re: whether you have a significant stake in the game or you don't. If recent Wagner Batman pages and similar are most of the cards in your hand, I don't think you do.

It's a fallacy of false dilemma  that those concerned about hobby economics cannot also love something, anything other than money/economics. LOL. We all love comic art; not everybody that loves comic art loves economics (subset within the set).

[vodou]

1 hour ago, PhilipB2k17 said:

I look at it this way. I think of owning these pieces of art as an aesthetic experience, rather than an investment. I get the "value" of being able to look at and enjoy the art from time to time, at my leisure and convenience. That, and knowing I'm the only one who possess it, gives me psychological satisfaction. I compare it to going on a nice vacation, or eating a very nice meal. Once you spend the money on those things, it is gone. And all you have are the memories and the experiences.

Now, imagine a world where you could "re-sell" your past vacations and meals (bare with me, its a thought experiment, not to be taken literally). Sometimes you may get back a larger amount of money than you spent on them originally. Sometimes you break even. Or, sometimes, you take a "loss." But, in each case, you still have the "value" of the experience and the memories.

An interesting anecdote about sunk cost but: even memories and experiences can be and are monetized. They're called memoirs and less formally reviews. Some take the matter of memoirs and reviews (for pay or exchange for goods/services of value) much more seriously than others and that's a to each their own matter, I'm just pointing out that even vacations, good meals and the like, typically thought of as sunk cost situations don't have to be.

1 hour ago, PhilipB2k17 said:

Nobody thinks of "taking a loss" on a vacation or a nice meal. They are not paying for an object of value, per se. They are paying for the experience. The same is true, I think, with most collectors of Original Art. Or, art of any kind, for that matter.

Most? Meaning more than 50%? I'm not so sure about that. Why are you? Can you point me to some statistically valid survey results of both the art of any kind and [comic/illustration] Original Art segments that bears this out.

[PhilipB2k17]

1 hour ago, vodou said:

An interesting anecdote about sunk cost but: even memories and experiences can be and are monetized. They're called memoirs and less formally reviews. Some take the matter of memoirs and reviews (for pay or exchange for goods/services of value) much more seriously than others and that's a to each their own matter, I'm just pointing out that even vacations, good meals and the like, typically thought of as sunk cost situations don't have to be.

Most? Meaning more than 50%? I'm not so sure about that. Why are you? Can you point me to some statistically valid survey results of both the art of any kind and [comic/illustration] Original Art segments that bears this out.

A) My point there is still valid. You may make money, break even, or lose money on monetizing your experiences. But, you generally paid the money for those experiences primarily for the experience, not to monetize your memories.

B) I think virtually everyone in this hobby hopes their art appreciates in value. But, that's different from expectation of appreciation, and making money, being the primary motivation for buying the art. I'm not talking about dealers, here. Dealers buy inventory, and that includes art they don't personally like, or have a connection with, because they know there's a market for it and they can sell it to someone who does want it. Collectors rarely do that. This doesn't mean dealers don't also collect - many do. But, a dealer's mindset is completely different than your average collector.

Do I have a statistical analysis or survey that shows this? Nope. I can only go by the sampling on this board, Felix's podcast, talking to other collectors at shows, etc. But, outside of dealers, I rarely hear any collector saying their primary motivator for buying art is to make money off of it. I think it is a fair, and reasonable, estimate to say that "most" do not.