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The Beanie Baby Bubble of '99
51–60 of 141 posts
Re: The Beanie Baby Bubble of '99
#52The current state of NFTs etc. amazes me in the context of Beanie Babies. So many people have learned nothing. Granted the time gap means these are entirely new people making those mistakes. We have such a degraded level of discourse now that if it were used in the Beanie Baby craze there would be people arguing about whether all soft toys are evil.
The difference is that stuffed toys have value independent of speculation.
True in the ones to dozens of dollars. I remember in the Beanies Baby era they were going for hundreds or thousands though.
I actually knew somebody with an extremely valuable collection in the late 90s whose house was broken into. Only the BBs were stolen, which speaks to their value being well beyond that of regular stuffed toys at the time.
Re: The Beanie Baby Bubble of '99
#53Earlier quoted context omitted.
> while building has been accelerating massively Nope, we have a decade of underproduction that led us to this crisis
Households to number of homes built is exactly the same as it was in year 2000. You can compute it yourself using FRED data. 1.1 homes per household (or vice versa). People who count from 2010 are cherrypicking the underbuilding decade while ignoring the overbuilding decade, 2000s. There is no "shortage" of homes, there's a shortage of homes listed currently.
Couldn't there also be a shortage of homes where people want them to be? A house in the city and a house in the boonies are not exchangeable
Re: The Beanie Baby Bubble of '99
#54How were these plastic beans even considered child-safe?
Or world safe. There was a huge thing in 2000s up to 2015 or so with tiny little plastic beads in soap that will forever contaminate the water supply and soil it ends up in, and I think it is still legal. Glitter, which is also tiny pieces of plastic, is still legal.
Re: The Beanie Baby Bubble of '99
#55Lot of people making comparisons to crypto / NFTs etc. Looking at it from another angle, what are the best examples of things that lots of people thought were bubbles, but turned out not to be?
Magic the Gathering cards probably
Re: The Beanie Baby Bubble of '99
#56There's a great history of this, The Great Beanie Baby Bubble: Mass Delusion and the Dark Side of Cute by Zac Bissonnette. It's a quick read, almost entirely original reporting. Aside from the colorful characters, it's really compelling to see the way some individuals' and limited information combined with mass media fell together to create the bubble. It seems like it couldn't have happened at any other time because…
Oh, bubbles can surely happen even in the era of widespread information. Look no further than housing. A few points on housing: - real home prices have now surpassed the 2000s peak - household formation and population growth has been decelerating, while building has been accelerating. - there are 1.1 homes per household, same as the year 2000. We are not at historically low supply as some claim. Only low in terms of…
Has building been accelerating in the areas where people want to live, though? e.g. lots of Californians wanting to move to MT or ID, but is building catching up there?
Re: The Beanie Baby Bubble of '99
#57I’m not a crypto evangelist or anything, but what about alternatives like Pokémon cards which seem to have increased in value over the same period. There’s currently a pump and dump on retro video games but I don’t think the same supply issues exist in Pokémon cards, but I’m not actively monitoring either market.
I think the difference between Beanie Babies and Pokemon/Magic cards is that trading cards hold some sort of utility outside of existence. There's a game behind the cards. And certain cards increase your chances of winning.
This is an ex ante explanation, because it doesn't apply to (canceled) stamps, which are valuable and have been for a couple centuries.
Re: The Beanie Baby Bubble of '99
#58Earlier quoted context omitted.
Households to number of homes built is exactly the same as it was in year 2000. You can compute it yourself using FRED data. 1.1 homes per household (or vice versa). People who count from 2010 are cherrypicking the underbuilding decade while ignoring the overbuilding decade, 2000s. There is no "shortage" of homes, there's a shortage of homes listed currently.
Couldn't there also be a shortage of homes where people want them to be? A house in the city and a house in the boonies are not exchangeable
That could apply to some local markets, sure. But we are seeing massive price increases rather universally, which implies it's a more widespread phenomena than just local undersupply.
But it will be true for certain markets. Most homebuilding is concentrated in the SMILE states (southern, areas where people are migrating to)
Re: The Beanie Baby Bubble of '99
#59The current state of NFTs etc. amazes me in the context of Beanie Babies. So many people have learned nothing. Granted the time gap means these are entirely new people making those mistakes. We have such a degraded level of discourse now that if it were used in the Beanie Baby craze there would be people arguing about whether all soft toys are evil.
Non-fungible tulips.
Re: The Beanie Baby Bubble of '99
#60Earlier quoted context omitted.
Oh, bubbles can surely happen even in the era of widespread information. Look no further than housing. A few points on housing: - real home prices have now surpassed the 2000s peak - household formation and population growth has been decelerating, while building has been accelerating. - there are 1.1 homes per household, same as the year 2000. We are not at historically low supply as some claim. Only low in terms of…
Sorry, I think I'm not following. I think you're saying that housing prices are too high. Then you're saying that if inflation continues housing prices will drop? I totally get that most home sales are based on the monthly mortgage bill, so when interest rates are high, house prices are lower. But, if we have 7% inflation why wouldn't rates increase AND prices increase? I don' think the outcome is obvious when high i…
When the Fed starts raising rates to try to counter inflation we'll see mortgage rates follow. If mortgage rates go up to, say, 7% (pretty close to the average mortgage rate over the last many decades) that's going to impact the monthly payment. If people are just barely able to afford a house at a certain price with 3% mortgage rates, they're not going to be able to afford it at 7% - it all comes down to monthly cash-flow. As fewer people can afford to buy at current prices with higher rates that limits demand at those prices and something has to give - either prices will fall to accommodate, or the market will just stagnate. Even so, a stagnant market can only last for so long before some sellers start lowering prices because they have to.
This is essentially what happened in the early 80s when we had mortgage rates in the upper teens. If you look at home price sales history during that era there were some quarters where average selling price went down 10% or more.