My Hubby, darling that he is, loves to buy stamps on eBay. Which is fine. Keeps him out of trouble, off the streets, etc.
My only irritation with this hobby is his insistence that he’s finding incredible “bargains”. Hoo-boy, this stamp he paid $.10 for, well it’s $250 in the 2000 Scott catalog!
Now, maybe I’m wrong, Og knows I’m no economist - but if he paid .10 for it, at auction, then it's worth .10. It’s not worth more until someone’s paid more for it. If this catalog is listing another price, but no one’s paying it, then the catalog is meaningless.
We used to have these same debates over baseball cards and comic books. I’m not entirely sure this is a GQ, but thought I’d start here & see if someone can enlighten me.
Lots of factors at work, here. First, it’s important to remember that the Scott people don’t sell stamps - they’re just in the business of producing a catalog with “values” attached to each item. The Scott Catalog price reflects, IIRC, what you would expect to pay a stamp retailer for the stamp in question. You’d be lucky to be able to sell it back to him for more than a third of that, and collectors selling to each other, or buying things at auction, would likewise be paying a lot less.
Second, condition is everything. There are grading standards for stamps (relating to things like centering, whether the original gum is intact, whether all the perforations are in perfect condition, etc.), and a stamp that would sell for $100 in VF (very fine) condition might only fetch $5 in AVG condition.
Last but not least, stamp collecting is a dying hobby, and prices have been dropping for years.
Ultimately, of course, you’re right: if the best bid for a given stamp in an an auction is $1, that stamp is worth $1. If hubby turned around and tried to sell it, he’d probably get about $1 for it, and it really doesn’t matter what the catalog says.
As with anything else, it is worth ehat someone will buy it for. The catalog is a guide for buyers, so he aught to get a good percentage of that price if he sells to someone who wants it. What is really stupid is that if the stamp is faulty (say they print the price upside down) then it may be worth an absolute fortune. So faulty products are worth more than good products!
Nothing is worth anything until you sell it and get money for it. That is not to say they have no value. If they give your husband a lot of pleasure, they are valuable to him. If he wants a particular stamp that costs $250, if he derives pleasure from owning it and the pleasure is more valuable to him than the money, then it’s woth $250. If he can find the same stamp on ebay for $0.10 then he has had his fun while saving $249.90.
But if he is trying to make an investment, thinking that one day he will put it on ebay and someone else will pay him $250 for it, then his logic may have a slight flaw in it.
Any suggestions for how to explain this flaw to him? I used to swear I was going to bury him with those damn baseball cards, just heave 'em in before they pile on the dirt. Calm and supportive, that’s me.
Scott values are inflated for assessing inventories, since they’re what you can expect to pay for the stamp at “list” retail from a dealer (who of course did not pay that price for it himself).
Also, as Early Out noted, the condition of the stamp is very important to its value – and Scott only lists mint and used values.
After some research, a collector-for-investment friend purchased Stamp Collector’s Data Base which gives three values (very good, fine, and very fine) for both mint and used stamps (and for plate blocks and such as well). I installed it for him and did some data entry to test it out, found it to be passable in terms of ease of use (not great, but moderately easy to manipulate and enter material in) – and the values listed match much closer what you might expect to buy/sell for on a non-forced sale between equals (e.g., to/from another collector). (Subscription to his service includes regular updates.) While one is not really supposed to push products here, and I do have some reservations about how terrific the product really is, it may be just what he needs to get realistic values.
In my 20s, I collected art. Exclusive dealers kept telling me about the incredible “resale value” of everything. Problem is, you will never get the retail price for anything–from anyone. A dealer won’t pay you retail for something, nor will a store owner. That leaves other buyers and connecting with the right buyer on something so esoteric as art or stamps is difficult to impossible. And if the buyer pays full price, that leaves little room for his investment to appreciate.
As others have said, “value” is determined by how much someone else is willing to fork over for it. All else is smoke and mirrors.
I’ve been perusing the eBay stamp auctions, and here’s what I see, for the most part: stamp dealers trying to unload their “problem children” on unsophisticated buyers. There are some tell-tale signs:[ul][li]The stamp is listed as “mint” without any further information. “Mint” simply means that it’s never been used to mail a letter. It doesn’t say anything about quality. The stamp, while uncancelled, may have no original gum, may have stamp hinges stuck to the back, may even be torn. No reputable dealer would list a stamp as “mint” without saying anything more about it.[]The stamp is listed as “VF,” where even a glance at the photo tells you that it ain’t. The grades (AVG, F, F-VF, VF, XF) refer to the centering of the stamp, and have fairly specific definitions.[]A lot of the eBay auction items don’t mention the grade - this just means that the buyer can’t come back and complain about what he got.[]On unused stamps, there is often no mention made of the condition of the gum. Again, no reputable dealer would do this. There’s a big price difference between NG (no gum), OG (original gum), NH (original gum that’s never had a stamp hinge put on it), and HR (there are the remains of a stamp hinge permanently stuck to the back of the stamp).[]The listings rarely mention things like pulled perfs, toned perfs, and creases, all of which have an effect on the value.I haven’t done an exhaustive search, but I haven’t seen any mentions of APS certificates. There are some stamps that are very difficult to identify accurately, and on some rare early stamps, it takes an expert to spot repairs and outright fakes. A certificate from the American Philatelic Society provides some assurance that what you’re getting is genuine, and is as described.[/ul]In short, if I were still collecting, I wouldn’t buy stamps on eBay on a dare.[/li]
[A cautionary tale: I collected for many years, usually buying stamps at respectable philatelic auction houses. I had a pretty good grasp of the ins and outs of the business. When I gave up the hobby, and auctioned off my collection, I probably got back a third of what I had spent. It’s a hobby, not an investment.]
One caveat: My mom recently bought a small stamp collection at a garage sale for fifty cents. Despite the fact that she is not a stamp collector, and knows nothing about the ranking of quality for collectable stamps, she’s quite certain that it was a huge bargain. How does she know this? The stamps are all American stamps, uncancelled, and their face value adds up to over $9.50. So even if, as she suspects, they have little to no value as collectibles, she can still legitimately use them to send close to ten dollars worth of mail. In a country such as the US which never devalues stamps, the true value of the stamp can never fall below its face value. So if your husband is getting 25 cent stamps for 10 cents apiece, well then, yes, he is getting a bargain (though perhaps not as big of one as he thought).
But if it’ll make your husband happy, just whip up a catalog yourself that lists the 2005 first-class stamp with the U. S. flag pattern as being worth five thousand dollars
With all due respect, your darling hubby doesn’t know that he doesn’t know what he is doing.
If you/he/me/anyone else does’nt really know the true value of what he is collecting he will get BURNED financially.
Take my word for it. I’ve been there and done that. Get involved with a philately (stamp collecting) club and learn the ropes before ‘investing.’ Catalog values are not the willing buyer/seller price. Stamp or coin fairs, exhibitions, get-to-gethers are far more realistic markets that eBay for collectables.
Hmmm…Thanks for the feedback everybody! Amazing what people around here know! I do wish it were better news - this is one where I wouldn’t have minded being proven wrong. The really dumb thing is we used to live about a mile from the national HQ of the American Philatelic Society!
