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Collectibles are terrible investments

fullstackeconomics.com

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Re: Collectibles are terrible investments

#111

Post by redisman »

giantrobot wrote: post #96
zenlikethat wrote: post #31

So funny enough, there _are_ some people looking at ways of generating cash flows with NFTs. For instance, some projects have offered a chunk of their fees from resales to users, or offer a token reward for staking the NFT. Or in Bored Ape Yacht Club's case, they just 'airdropped' a bunch of a new token over to holders, giving them free money essentially. Yes, just about everything out there still feels pyramid-schem…

> lending as an item in an in-game economy... That's never going to happen in a real game because no game developer is going to spend time supporting some "item" bought somewhere else. There's no incentive for them. They can much more readily just sell their own in-game items and make all the money from the sale. This has the positive side effect for the developer that the in game item can't be taken to some other ga…

It also completely breaks the game economy and experience if you can bring a bunch of random valuable stuff with you when you start.

Re: Collectibles are terrible investments

#112

Post by bcrosby95 »

majormajor wrote: post #8
allturtles wrote: post #7

I find this argument very strange: > But it is, because in the long run, assets without cash flows cannot increase in value more than the economy as a whole. If something appreciates faster than the whole economy in the long run, it eventually eclipses the whole economy, which is impossible. No one is operating on an infinite time horizon in their investments, so this argument seems moot. You can certainly find colle…

The article is arguing that you aren't likely to be able to pick the ones that will grow faster than the economy as a whole over the time frame you intend, because it relies on an extreme amount of right-place-right-time luck. If you were looking for the next Beanie Baby for the last 20 years, do you think you would've found it? I think it's also arguing that the particular appreciation you need to capture largely on…

> "before you heard of it"

Not quite true for MTG. It was insanely popular in the mid-to-late '90s, and you could still pick up a black lotus for $250. Dual lands, which are now $100+ each, could be had for $5 each.

For MTG, the problem was more "is this gonna keep increasing in value". In hindsight the answer is yes.

Re: Collectibles are terrible investments

#113

Post by [deleted] »

majormajor wrote: post #60
linkjuice4all wrote: post #55

Earlier quoted context omitted.

There’s some predictability in terms of people trying to buy all the things they wanted as a kid when they finally have the adult income to afford it. Some examples include muscle cars, BMX bikes, LEGO sets, and other things that a large population of children were aware of and wanted. If you just stock-pile the big sellers or scoop up the used stuff when it bottoms out in value then you might be able to profit. The…

How are 90s baseball cards, pogs, and yo-yos looking? Or "regular" opened copies of NHL 94 or what have you? I think we often overlook all the shit we were into that hasn't gotten expensive. We'd have to basically index-fund this shit if we had really been trying to invest in it in 2000 or so, and I think the losers would be a big problem for our fund. Maybe you bought a 3000GT instead of a Supra because you didn't s…

[deleted]

Re: Collectibles are terrible investments

#117

Post by totoglazer »

Waterluvian wrote: post #35
allturtles wrote: post #7

I find this argument very strange: > But it is, because in the long run, assets without cash flows cannot increase in value more than the economy as a whole. If something appreciates faster than the whole economy in the long run, it eventually eclipses the whole economy, which is impossible. No one is operating on an infinite time horizon in their investments, so this argument seems moot. You can certainly find colle…

Tangent: based on my internal perceptions throughout the past decades, I’m positively shocked that a Black Lotus is only worth $11,000.

I was as well. Apparently it’s not true though. Here’s a record at half a million. https://www.reddit.com/r/magicTCG/comments/l6lpol/a_black_lo...

Re: Collectibles are terrible investments

#118

Post by raffraffraff »

Natsu wrote: post #82
majormajor wrote: post #8

Earlier quoted context omitted.

The article is arguing that you aren't likely to be able to pick the ones that will grow faster than the economy as a whole over the time frame you intend, because it relies on an extreme amount of right-place-right-time luck. If you were looking for the next Beanie Baby for the last 20 years, do you think you would've found it? I think it's also arguing that the particular appreciation you need to capture largely on…

> If you were looking for the next Beanie Baby for the last 20 years, do you think you would've found it? Even easier, if you just pick the right 6 numbers you could end up with millions of dollars.

Unfortunately this is why I've given up on investing anything more in stocks or crypto. Everything I invested since before COVID is down.

My coinbase account currently has only 34% of the value I put into it 2 years ago, and I spread my investment over the top 5 hot currencies at that time (ethereum, cardano, algorand, sushi, bitcoin).

My stock investments are doing better at 65% of what I invested (tech, engineering, infra, pharma). Most are doing ok (down about 10%) but one in particular has absolutely tanked even though their pharma products are doing great and they've got two promising drugs in clinical trials. It's value has gone down 65% in the last year.

People will tell you to do you DD but the simple fact is, you can't. The market doesn't operate on any type of logic, a cat can do as well as a stock broker at picking stocks, and huge investment firms only win out in aggregate because they can (usually) absorb gigantic losses.

Right now I'm "bag holding" for the foreseeable. I consider these things "back pocket lottery tickets" that might one day give me a small win. But for the future I'm maxing out my pension and saving enough to buy a rental property, because one thing that has never dipped through boom and bust (at least where I live), is rent.

Edit: I lie, part of my TC is stock, so wherever I work, I am "investing in them" too

Re: Collectibles are terrible investments

#119

Post by ddorian43 »

raffraffraff wrote: post #118
Natsu wrote: post #82

Earlier quoted context omitted.

> If you were looking for the next Beanie Baby for the last 20 years, do you think you would've found it? Even easier, if you just pick the right 6 numbers you could end up with millions of dollars.

Unfortunately this is why I've given up on investing anything more in stocks or crypto. Everything I invested since before COVID is down. My coinbase account currently has only 34% of the value I put into it 2 years ago, and I spread my investment over the top 5 hot currencies at that time (ethereum, cardano, algorand, sushi, bitcoin). My stock investments are doing better at 65% of what I invested (tech, engineering…

> People will tell you to do you DD

No they do not tell you to DD. Just do boggleheads method.

And its your fault for "investing" in shitcoins (all coins are shitcoins).

And the time horizon is 20 years and not 2.

You can buy a house and it needs a repair in the 2nd year and you are again in the hole. You get a bad tenant and again bag holding.

Everybody has promising clinical trials all the time.

Re: Collectibles are terrible investments

#120

Post by jhbadger »

grapeskin wrote: post #45
majormajor wrote: post #32

Earlier quoted context omitted.

This is covered in the article in the cash flow aspect. Outside of a total economic collapse that took out "real" investments and collectibles both, the reasons the value of an Apple share would fall, or the price of land would fall, would be much more tangible and understandable. The relationship for land is more obvious and immediate that business investment (you can charge rent!) but someone in 2010 who said "this…

People will also keep buying pristine copies of old games so long as that series has some popularity. People aren’t going to lose interest in Nintendo series any time soon. Even if Nintendo made some awful business decisions, went bankrupt, and the developers and executives were all revealed to be violent criminals, people would still love those games and want to own them. There’s a non zero possibility Apple could b…

But collectibles have a finite length of value based on the generation to which they are of interest. Many old baseball cards from the 1950s and 1960s are actually going down in value as the people to whom they were nostalgic are dying off. It might be a while for Nintendo NES/Famicom nostalgia to do the same (and even later for subsequent consoles), but eventually the people who had those consoles as children will die and later generations just won't care.
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