Rare...
"The illusion has become real, and the more real it becomes, the more desperately they want it. Capitalism at it's finest."—Gordon Gekko
Rarity is a favorite term of art for me because it is so misunderstood and misused. One eBay seller I watch uses “rare” in every auction title, no matter what he is selling. A rare card for five bucks? Where do I sign up? (insert roll eyes emoji here)
Let’s try and define our terms with greater precision, shall we? Imprecise language is the bane of my existence. I hate ambiguities. My teeth just grind whenever someone asks whether a card is “real” because there are two different yet totally correct answers to that: (1) it is real because it exists in the physical world, and (2) it is real because it is authentic. What they meant to ask is whether it is authentic.
But I digress…
There are three wildly different forms of rarity:
1. Absolute rarity: few of this item in existence. It is hard to find in any condition at any time. The Ty Cobb brand Cobb card is a case of absolute rarity, with about 20 total known examples.
2. Condition rarity: the card can be common, but few have graded in that specific condition with a third-party grader. A 1952 Topps Mantle is not rare. You could have one tomorrow if you have the cash. A PSA 10 1952 Topps Mantle is a condition rarity. There are three (I think; I really don’t keep that close a watch since I don’t have one).
3. Manufactured rarity: The 2018 Leaf Originals Metal Errol Spence, Jr. orange version is numbered / 4. There are four in existence, by design.
Absolute rarity is wonderful and complicated all at the same time. On the one hand, when you have a truly rare item, you have something truly special. You can set the price and hold out to get it. I had a 19th century baseball card, anN300 Mayo Hugh Duffy. I really prized that card. Great image of a guy who hit .440 in 1894 with an on-base percentage of .502. Those stats are not typos. Anyway, the PSA population today is 27 cards. SGC has 43 cards in its database. So, 70 total cards slabbed in every grade. People also tend to hang on to them: PSA does not show a sale at auction since 2018 in any grade. A buyer wanted my Duffy card, and I was reluctant to sell it, so I set a price I could live with, without reference to any market or comparable price. He tried everything to wheedle it out of me for less, every argument there is, but I just said no over and over again. Ultimately, I told him to pay what I was asking or find it somewhere else. Of course, he could not, so he ended up paying my asking price. That is the beauty of owing a rare item: my way or the highway. Of course, I really wanted another one and it took me several years to find one at a reasonable price.
On the other hand, trying to figure out a fair price for an absolutely rare item is very challenging and there is a lot of FOMO when one comes up for sale. I bought an impossibly rare card at auction, an R340 Sport Kings premium of Jack Dempsey, Max Baer and Primo Carnera. It came out of the estate of a longtime boxing memorabilia dealer. There are no other known examples. I had no idea what to pay for it and I have no idea what I would want for it. The card has no easily defined market. I just bore down and decided to pay what it would take to get it.
Moving on, if you guessed that I am contemptuous of condition rarity and loathe manufactured rarity, you are correct.
Condition rarity is one of the riskiest things to buy into for investment for two reasons. First, when it comes to newer mainstream cards, that pop 1 becomes a pop 5 all too readily. It is inevitable. When you have a shit-ton of cards kept in pack-fresh condition and a mountain of unopened material, there will be a shit-ton of pack-fresh cards to grade and inevitably a big stack of 10s. Consider the card that many think of as the granddaddy of modern cards, the 1989 Upper Deck Ken Griffey Jr. rookie card. Total PSA population of this card as of January 14, 2023, is 176,667, of which 4,091 are unqualified PSA 10 graded cards. The people trying to sell these cards will tell you that PSA 10 are only 2.3% of the total population of PSA Griffey cards. True, but meaningless, because there are still over 4,000 PSA perfect 10 Griffey cards. Add in the SGC and CSG and Beckett populations and there are even more. If you bust a box of 1989 UD and find a Griffey and if the PSA card gods smile upon you, your card will still be one of thousands. Prices on these cards have actually fallen. That 1989 UD Griffey PSA 10, if you find a buyer, it will be in the $1500-$1700 range. And, of course, the distinctions PSA makes over these cards is so trivial that you can put a bunch of PSA 9 Griffeys with a 10 Griffey in a pile with the labels covered and the vast majority of collectors will not be able to choose the PSA 10. Getting a ten on a raw card is like hitting a slot: freakish, spontaneous wealth.
The second reason I detest condition rarity is that massive value swings result from arbitrary and opaque decisions made by unknown persons at the TPG, and the TPGs have a dismal track record of approving altered cards. There are hundreds and hundreds of examples of altered cards in various TPG holders. The fine folks at Blowout Cards have outed tons of them. Card doctors beat the graders regularly.
Take T206 as an example. I am very dubious about high grade T206 cards. I bought my first T206 in 1977. When I collected them heavily, grading did not exist, so the vast majority of my collection was purchased or traded for as ‘raw’ cards. Two things stood out at the time I collected T206s. First, there were no cards in what we would consider near mint or better and precious few that would make ex-mt. They simply did not exist. Second, most T206s had wide, fat borders. Only the American Beauty cards were noticeably slimmed down. Well, decades later, when grading is the thing, there are many more cards in the upper echelons of condition and many of those cards sure are skinny. I was the victim of one of them. I purchased an SGC 6 Rube Waddell portrait. Gorgeous card in the catalog, but just did not look right in hand. I took it to the National and brought to to SGC, and sure as hell, they agreed it was trimmed and had slipped through. They bought it back and I got my nice, fat-bordered vg card to replace it that same day.
Manufactured rarity is an even dumber investment, in my not-so-humble opinion. The problem with these manufactured rarities is that demand for them hasn’t built organically and over the long term. The manufacturers keep churning them out, year after year, in every series and set, and they get hyped relentlessly, until the next wave of cards is issued and they become yesterday’s news. Also, when every card has a rainbow of parallel manufactured rarities, player collectors get frustrated and burned out, and they quit. I know I did when I tried to collect the rainbow of 2018 Leaf Metal Errol Spence cards. I stalled out with the orange /4 card. The /3, /2 and/1 cards were nowhere to be found. So I quit. Add frustration to the hype and a new super-duper rare card coming out every week (or so it seems) and there just does not seem to be a long-term value there. The proof is on eBay, which is filled with listings for thousands of cards of the last 30 years that had very limited print runs, and they mostly sell for very little compared to when they were hyped as the next great things. I can attest to this myself. I recently decided to sell into a surge in modern boxing card prices. I had a 1/1 2011 Leaf Muhammad Ali Prismatic Gold card. I had it slabbed at CSG, and it got a ten. So, not only is it a 1/1, it is a perfect 10. Great. I could not find an auctioneer to handle it. I ended up selling it on eBay for not that much money.
Manufactured rarities remind me of jewelry. Go to a jewelry district in a major city. My wife and daughter lured me into going to the one in Los Angeles. After traipsing through several floors of this stuff at the diamond mart I turned to my wife and said: “this stuff is so common, it is not an investment, it is just expensive.” I learned just how accurate that was when I tried to close out my mother’s estate. All of the jewelry she spent six figures amassing was worth perhaps 10% of what she had spent, purely for the metal and stones. Not an investment, a consumer good. Same as manufactured rarity cards.
If you can go to a show and find showcases and boxes filled with thousands of ‘rare’ limited edition numbered cards, you are no longer looking at an investment. That’s when I run away. Expensive and investment are not analogous concepts.