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Postmortem of a Legend – Why Vintage Baseball Cards Don’t Qualify as Investment Grade

Postmortem of a Legend - Why Vintage Baseball Cards Don't Qualify as Investment Grade

When I’m doing research on possible investment grade antiques, I come across a lot of marginal antiques.  In this situation a particular class of antiques comes very close to being investment grade, only to lack one or two vital attributes.  An item’s investment grade status is generally determined by five distinct elements: portability, quality of materials and construction, durability, scarcity and stylistic zeitgeist.  In a marginal class of antiques, one or more of these qualities is absent or inadequate.  This delineates items that are merely collectibles from true investment grade pieces.

Vintage baseball cards are a great example of this phenomenon.  For a long time I looked into these early to mid 20th century mementos of the great American pastime.  They have a lot going for them.  First and foremost, they celebrate that quintessentially American sport – baseball.  This gives them major cultural or zeitgeist points, especially considering that the antique market is awash in goods that are total anachronisms in the current age.  Copper coal scuttles and brass tea strainers are not only unnecessary in the modern world, but also lack any significant stylistic mojo.  In contrast, baseball cards are still culturally relevant.  That is a major win.

However, a class of antiques cannot be declared investment grade based solely on scoring well in one of the five aspects of investability.  And while baseball cards do well in two of the other categories (portability and scarcity: both good enough) they fall flat in the final two elements.  Quality and durability are the investment Achilles heel of baseball cards.

Originally used as cheap prizes that were packaged with cigarettes or candy, vintage baseball cards are made out of cardboard…and not high quality cardboard either.  Intended to be abused, lost and damaged, they were throwaway items.  Baseball cards were meant for hyperactive, grubby kids to trade amongst themselves and put in the spokes of bicycle wheels.  They were never meant to be treasures and were, consequently, never manufactured to stand the test of time.

This cheap fabrication was reflected in their mass printing and distribution.  In the 1920s through the 1960s every candy shop and corner store in the U.S. sold baseball cards (and candy or gum with them) for a few pennies each.  They were the antithesis of luxury goods.  Unfortunately, in my opinion, this is fatal to any aspirations baseball cards may have to become legitimate investment vehicles.  After all, when accidentally nicking the flimsy edge of an iconic 1932 U.S. Caramel Babe Ruth card instantaneously drops its market value by 25% or more, the importance of durability in investment grade antiques becomes obvious.

Another major factor that eliminates vintage baseball cards from contention for investment grade status is the fact that professional baseball is a largely U.S. (and Canadian) sport.  This severely limits the possible collector base, a fatal coup de grace when coupled with their less than durable cardboard construction.  Most investment grade antiques have strong international demand, reducing dependence on any one geographical area.

Of course, baseball is also big in Japan, but that doesn’t fundamentally change matters much.  It is unlikely that most Japanese baseball card collectors would be scouting for vintage U.S. cards anyway.  Instead, they would probably just stick to vintage Japanese baseball cards.  Baseball is a major sport in a few other Central and South American countries, but they are too small to impact demand in the U.S. card market significantly.

Now I don’t want anyone reading this to get the wrong idea.  I don’t dislike vintage baseball cards or think they are “bad”.  I don’t even have an opinion on their future return potential, which may or may not be good.  What I do know is that according to the five attributes of investability, vintage baseball cards come up short on two.  It doesn’t mean they can’t appreciate in the future, but it does mean that I can’t predict that possible appreciation with any certainty.  When investing my own money, I would prefer to stick with a surer thing.

The Ethics of Elephant Ivory and Art

The Ethics of Elephant Ivory and Art

Ivory is one of the world’s great unsung treasures.  Its inviting warmth and tantalizing, organic texture is innately attractive, an obvious predecessor to the finer properties of today’s plastics.  Although elephants are the most well known source of the venerable material, ivory also originates from a variety of other animals, including hippos, narwhals, walruses and sperm whale.  Even ivory tusks from extinct woolly mammoths are still found and used today by fine craftsmen around the world.

While stunningly beautiful, ivory is also one of the most controversial materials commonly encountered in antiques.  Due to the rapidly shrinking populations of wild African and Asian elephants, ivory has become a focal point of international law enforcement.  Although possession of elephant ivory is generally not banned outright, trade in ivory or ivory items is heavily regulated by the global community.  In spite of the heavy web of laws and regulations surrounding the ivory industry, the poaching of elephants for their tusks has continued unabated.  In response to this development, many nations – including those as diverse as Kenya, Gabon, the Philippines, Hong Kong, China, France, Ethiopia, the Congo and the United States – have crushed, burned or otherwise destroyed previously seized stockpiles of illegal ivory.

Over the past 30 years more than 100 tons of illegally poached elephant ivory has been destroyed in this way.  Environmentalist and conservationists applaud this policy as a way to send a powerful, “zero-tolerance” message to would be poachers and dealers in illegal ivory.  Unfortunately, like many well-intentioned policy initiatives, it may also have more negative, unintended consequences.

First, destroying national elephant ivory stockpiles does not directly impact poachers or illegal dealers.  These two illicit groups only care about one thing: is the ivory they poach today salable?  Destroying existing ivory stockpiles doesn’t change the economic calculus of the situation one iota.  If anything, severely restricting the availability of elephant ivory only serves to elevate the cream-colored material to an almost mythical status.  This enhances its desirability to amoral consumers who are driven primarily by the social status that extreme rarity imparts.  Simply put, if poachers think they can find a buyer for ivory, they will kill more elephants.  Any illegal ivory that might be seized is simply written off as a loss – an acceptable part of doing business – by those operating illicitly.  The poacher or illegal dealer doesn’t care or even know if his previously seized ivory has been destroyed.

The second issue is the unspoken future artistic sacrifice that is made when national governments destroy elephant ivory stockpiles.  Ivory has been a recurring theme in exquisite sculpture, carvings, jewelry and musical instruments – not to mention countless other tangible arts – throughout human history.  Ivory is truly a physical cornerstone of humanity’s artistic expression as a species – an inherently amazing material which has been treasured by our ancestors for thousands of years.  Destroying ivory that has already been seized by national governments constitutes a pointless cultural holocaust.  Any ivory destroyed today is ivory our grandchildren and great-grandchildren will never get the opportunity to admire in a work of fine art.  Crushing our collective cultural patrimony doesn’t, ultimately, make the world a better place.  It doesn’t even save any elephants.  Instead we become collectively poorer, both culturally and spiritually, when elephant tusks are burned upon the pyre of international pressure to “do something”.

Let’s peer 50 to 100 years into the future.  Although I sincerely hope I am wrong, in all probability both Asian and African elephants will be extinct in the wild.  National governments will have proven unable to stop the extermination of elephants because poaching is driven primarily by human poverty in elephant habitats.  In other words, as long as sub-Saharan Africa and Southeast Asia are economically poor, people there will poach to augment their incomes.  As a result, elephant ivory will have become an incredibly rare and highly coveted material.  Instead of feeding tons of seized ivory into the grinder, countries could have sequestered these precious ivory stockpiles in secure locations like Swiss underground bank vaults.

In this probable, dystopian future, poaching is no longer an issue – all the wild elephants are already gone.  Therefore, these official, state-approved elephant ivory stockpiles could be quite legally and ethically sold.  This would grant an economic boon – perhaps for further conservation of other species or elephant repopulation efforts – to the nations that once harbored these magnificent tusked beasts while also providing the art world with a ready source of a gorgeous and rare luxury material.  Instead of this more reasonable outcome, I fear all the world will end up with will be crushed ivory dust, extinct elephants and, of course, bitter regrets.

Don’t Collect the Artist

Don't Collect the Artist

Those of us familiar with the art world constantly hear the names of famous artists thrown around.  Andy Warhol, Jasper Johns, Roy Lichtenstein and Willem de Kooning are just a few of the modern artists whispered about in hushed, reverent tones – almost as if their names invoke a supernatural power.  These artists and their many contemporaries usually have their works breathlessly described with words like ground-breaking, powerful, avant-garde and unique.  Their works also often sell for astonishingly high sums of money.  10 million dollars – 20 million dollars – 30 million dollars – it almost seems as if there is no limit to the prices some works of modern art can command.  And yet, these artists’ works are rarely good investments.  Why?

To be blunt, they are fads.  The people paying outrageous sums of money for non-representational blobs of brightly colored paint on a white canvas are not really art connoisseurs.  They wish to be perceived this way, but wishing doesn’t make it so.  Today’s modern art collectors are largely nouveau riche financial services executives or wealthy technology entrepreneurs who want to be recognized by their peers as cultured individuals.  Collecting art is a good way for them to appear as urbane sophisticates.  And no art serves this purpose better than abstract works from well-known modern artists.  Most modern art can be simultaneously opaque, unapproachable and sometimes, quite frankly, unconscionably ugly.  But these works are popular right now and make for great conversation pieces.  So out comes the checkbook and before too long another record price is set.

And now we’ve arrived at the heart of the matter.  Most of these hedge fund manager and Silicon Valley CEO collectors don’t know the first thing about art.  They are just parroting what they hear their jet-setting friends and business associates say.  Instead of understanding and appreciating the art itself, they are “collecting the artist”.  In some ways this is a very human reaction to what can be a very intimidating field of study.  Art is often complicated; meaningful commentary on a work can rarely be distilled into a glib, dinner-party sound bite.  And if you don’t really care about art – but only about impressing your very wealthy colleagues – then collecting the artist (especially modern artist) might seem like a reasonable move.

All of this focus on artists instead of art creates an opportunity for those investors who are willing to educate themselves properly and not be deluded by the latest craze.  Real art is instantly, undeniably beautiful.  It stands on its own merits, never relying upon a famous artist for its desirability.  When reasonably priced, authentic, high quality art tends to appreciate in monetary terms far into the future, regardless of who created it.  Don’t be caught chasing a hot artist in a fad that you don’t understand.  Always collect art for the beauty and allure of work itself; never just blindly “collect the artist”.

The Sunset of the Age of Discovery

The Sunset of the Age of Discovery

Many historians spend a great deal of time researching the Age of Discovery, when European explorers sailed to every corner of the globe in search of new lands, peoples and riches.  However, they usually focus on the beginning of the period in the 15th and 16th centuries.

In my opinion though, it is really the end of the Age of Discovery that has more importance for art and antiquities collectors.  I loosely define this period as taking place during the early to mid 20th century.  It was during this historically crucial time that the last of earth’s wonders, both manmade and natural, were revealed.

Even a mere hundred years ago an amateur explorer could hike through the densest jungles of South America and into a lost city floating in the Andes Mountains.  Machu Picchu, abandoned by the Incas for almost 350 years, was only rediscovered by American professor Hiram Bingham in 1911.

Similarly, in the late 1940s nomadic Bedouin shepherds accidentally uncovered the Dead Sea Scrolls in desert caves in the Holy Land.  These priceless ancient religious texts contained the oldest extant writings of the Jewish and Christian Bibles known.

The mysterious culture of ancient Egypt also surrendered it last great treasures in the sunset of the Age of Discovery.  Egyptian pharaoh Tutankhamun’s unlooted tomb, found in 1922 by British archaeologist Howard Carter and his benefactor, aristocrat Lord Carnarvon, was almost certainly the greatest archaeological discovery of all time.  Forgotten for over 3200 years, it was a miracle that the tomb had remained intact.

A mere 18 years later, in the dark shadow of a brutal global conflict, French professor Pierre Montet uncovered the only other undisturbed Egyptian pharaoh’s tomb, that of Psusennes I, The Silver Pharaoh.

The earth was still grudgingly giving up her secrets to intrepid explorers into the mid 20th century.  A U.S. bush pilot operating in Venezuela, Jimmie Angel, first spotted the world’s highest waterfall in 1933 – 3,212 foot (979 meters) tall Angel Falls.

Even Mount Everest, the highest point on earth, only succumbed to ambitious New Zealand mountain climber Edmund Hillary and his rugged Nepalese Sherpa Tenzing Norgay in 1953.  However, it is possible that the famed Himalayan peak had actually been conquered decades before by doomed English mountaineer George Mallory in 1924 before claiming his life.

From an exploration standpoint, it had all been done, found or seen shortly after World War II ended.  Incidentally, I think this is one of the reasons the swashbuckling Indiana Jones movie franchise so captivated the public.  The lead character and story were set in the 1930s, the last time an explorer could plausibly still have any realistic hope of finding truly amazing hidden artifacts or cities.  Of course setting the movies against a backdrop of an evil Nazi organization obsessed with diabolical mysticism didn’t hurt either.

The end of the Age of Discovery has significant implications for connoisseurs and investors in fine art, antiquities and antiques.  It means that there are likely no more major unknown civilizations waiting to be uncovered.  Likewise, there are almost certainly no more intact ancient cities waiting in the mists.

The grandest and most important archaeological finds have assuredly been brought to light already.  And, of course, there are no more grand natural mysteries still residing on distant, forgotten corners of the globe.  While this might seem sad, it should help us realize that, as collectors, we are working with a relatively fixed pool of artifacts.  Invest accordingly.