Anyone Bought Into Keith Heddle's Sales Pitch?

I remember watching some video by Keith Heddle on how stamp investment has outdone other forms of investment. He seems to swear by rare stamp investment as a safe haven and even went on to talk about investing in error stamps. I wonder if anyone in this forum has bought into his pitch and parked money with SG.

I collect stamps as a hobby and ignore all the investment stuff


Peter

Collecting stamps as an investment would likely destroy my desire to collect stamps. Most stamps do not readily accrue in value ... hence one would be severely limited in the choice of which stamps to acquire. And when you do identify a desirable investment grade stamp, you would likely want to purchase it in quantity ... provided your pockets are deep enough & the product supply numerous enough. Investing & collecting (in the normal sense of the word) seem to me to be somewhat incompatible activities.
Of course, with REALLY deep pockets, one could be both a collector and an investor. But in this instance, is the collector truly acting as an investor ... or just using his/her wealth to occasionally acquire investment grade material?

Why risk investing in stamps? Invest in vintage Dennison hinges, 4000% increase since the early 1970s. Demand high, supply keeps getting smaller and smaller. No brainer, only risk is if someone figures out how to make them (which has not been the case in the last 40-50 years).

Don

You can invest in anything. You can make money on any of those investments. You can also lose your shirt. It all needs to be looked at as gambling.

I first started hearing about SG stamp investment program around the time that the Afinsa scandal broke. I really wondered what they were smoking!

I invested in stamps ,thousands of dollars or more accurate tens of thousands of dollars . During the 1980's and 1990's ,I attended 50 or 60 stamp auctions and purchased tons of material. It was a joke at some stamp auction firms they even threw in the lots that didn't sell . At Rasdales in Chicago they would tell me that I would be the last one to check out . At Richard Drews stamp auctions he would call me the week after a auction and I would stop in and we "created" a price for what didn't sell and then tell me to hurry up and get the stuff out of his store because he needed the room .


Then ......then some guy on the West Coast created a thing called ebay .All those stamps I paid 2 cents or less and sometimes I would price them 2 for a penny if unsorted or in glassines or stock books . My wife wanted to see the walls in the garage again and wanted the junk out .I started to sell at 3 or 4 cents a stamp that got insane because stuff was selling within a hour of listing on ebay ,so I up the price and sold off that wall of boxes somewhere around 6 to 9 cents each for the stamps ,in sets and in the albums or country pages .

Sad to say it was over in four years of selling and my wife seen her garage wall again . Now I collect for myself .

I believe the topic is geared more towards quality individual stamps of high cv rather than bulk lots of stuff.

Investments are what is being discussed . Look what RAY K. did with McDonalds he said "If he could make a penny with each item sold ,he would make millions" I think he made Billions .

with Don!

The only good stamp investments are the good ones you may find in a truly accumulated collection owned by an unknowledgable collector and bought economically.

Or the errors you find in booklets and stamps purchased for face at your local P.O.

Yes the hinges are one of the best. I walked into an old used/ second hand store a few years ago. They had two cartons complete! Because there was no heat and a bit dampish, I went through the packages in boxes. Got 15 good dry unaffected sealed packages at a bargain price.

Apparantly I heard they stopped making them because they contained warafin - rat poison. Hope I spelled that correctly.

Well, personally I think they should manufacture these now! I believe that is why the last generation of collectors lived so long. Not only a relaxing hobby, but also a dose of blood thinners preventing strokes and heart attacks! Worth consideration eh!

Mike

I think any average cheap stamp can be a good investment. A stamp bought at 50 cents and sold for a dollar is a 100% return on investment. You just need to sell hundreds of these to make your time worthwhile. I feel that stamp collecting should ultimately still be based on one's love for stamps and should not be about financial gain. Of course seeing paper gains would give one a good feeling. SG promoting stamps as investments is mainly to make themselves relevant in the modern times and to answer to stakeholders.

Back in about 1977-1978, many dealers were buying US sheets at very good rates for some reason. My father who had accumulated many, turned them over to me to dispose of. I went though the stamps wanted ads in Linn's and sold off most of them. The prices were so good that I recovered face value for him and made something for myself, as well. It's hard to get face for most sheets, today, even those from the 1960's and 1970's I was selling off back then. Somewhere along the way, the whole speculative bubble burst.

An earlier speculative bubble that I remember came with the MNH craze that hit in the 1960's. The hot countries were mostly in Western Europe, especially Switzerland, Lichtenstein, Germany, the Vatican as well as the UN. Stamp shops at the time had sharpies coming through and cleaning out under priced stock from unaware dealers. There were articles about this in The Stamp Wholesaler, a dealer's trade magazine that I read. That one burst, as well. There is relatively little interest in stamps form these areas, today.

Warfarin is the drug of choice as a blood thinner (for reducing blood clots) today.

I've never heard the rat poison on Dennison's hinges story before, and I suspect it's someone's joke that got picked up and treated too seriously along the way. I'm having some trouble believing that generations of stamp collectors licked hinges with rat poison on them without anyone being affected. But you never know, I suppose. I'm not feeling so well myself lately . . . .

The usual explanation for the demise of Dennison's hinges, one that sounds believable to me, is that Dennison's hinges were made using old-fashioned glue made from processed animal parts -- horses, and so on -- as glue had been made for years. In an era of new consumer standards, that may have made them suspect. How this exactly happened, I have no idea. But I suppose there might have been some sort of problem buying the glue from the glue factory due to new processing standards requiring that no animal products be used in stamp hinges since people licked them.

The glue was the key thing. It was Dennison's glue formula that made the hinges "peelable," as they used to say. Without being able to remove them, they would have been no different from any other hinges. Changes in glue standards sounds logical to me. I have also heard this claim repeatedly, which doesn't prove it by any means, but it makes good sense especially given both their fairly sudden disappearance and other manufacturers' subsequent inability to duplicate Dennison's peelable glue formula again later.

Now back to my laboratory to try another glue formula!

As for stamps as an investment medium, go ahead and try. But I wouldn't do it in bulk. I don't think stamp collecting is exactly an expanding hobby today. If you need to invest in "things," maybe invest in old computer equipment as there seems to be a weird nostalgia for the computers people grew up with years ago. Stamp investing is normally focused on high-value rarer stamps. Those will hold their value and probably increase over time, as they always seem to do, but ordinary collections and accumulations will not. Personally, though, I plan to stick to mutual funds, stocks and bonds.

History of Dennison Hinges
http://stampsmarter.com/learning/Gen_Dennison.html
Don

From the article Don links to (and apologies for this tangent in a posting about investing in stamps!): "In 1995 researchers interviewed an ex-Dennison employee who said they were told to destroy files on the hinge-making process and that they had a 'great loss when 38 years of my work at Dennison was gone forever. As I recall it was a good product but very difficult to make.' Some believe that the switch from natural glues to synthetic adhesives lead to poor quality hinges. Others have speculated that Dennison processed a texturing on the adhesive surface. This textured gum surface meant that less material would adhere the hinge to the stamp and this is what made them so peelable.'"

The "natural glues" referred to would more than likely have contained animal byproducts, as this was normal at the time. My questions:

(1) Why were these hinges "very difficult to make"? It's just glued paper cut into small rectangles. What's so hard about that? More than likely, there's something else involved like getting the glue just right or applying it in the right amount, or some other difficulty.

(2) I don't get the "texturing" claim, but it's an interesting one. Maybe a rougher paper surface kept all the glue from adhering to the stamp and album page, making it easier to remove? Sounds a bit odd to me, but maybe.

(3) I'm most interested in the claim that employees "were told to destroy files on the hinge-making process". I understand throwing away material no longer useful, but why would they go this far and destroy basic information about how they manufactured something? That wouldn't have taken up any space at all. It's pretty strange for a company to do that.

Not to create a conspiracy theory or anything, but it does sound as if maybe the company which purchased the original Dennison's company might not have wanted the fact that they had once used animal parts in their glue to become public knowledge. Not that corporations ever cover up things they think might become embarrassing, of course.

That may be the reason for the death of our favorite stamp hinges right there -- the new owners dropped the old glue formulation because it didn't meet modern consumer standards and then threw away all records of that glue so no one could criticize the company later for its earlier practice of using glue based on animal parts (even though that's how glue had always been made!).

Somewhere someone knows what was in that glue, I'd bet. It wasn't that long ago. I hereby offer a $1.00 prize to any former employee of Dennison's who will produce their old glue formula or is willing to describe how their hinges were made.