Market Value Vs Catalogue Value

Brixton - I agree with your statements overall. For myself I do not do anything in business without the expectation at some point of maximizing profit and that is as it should be. The adage that something is not missed until it is gone holds true for philately whether it be a dealer, auction house, publisher etc.. we all need to support these key components of our hobby. Your penny start ebay examples are spot on. Those listings exist because of collectors that delude themselves into thinking that they can acquire scarce or rare items for their collections on the cheap and we all know that is fantasy. Not everybody is Bill Gross and that is just cold hard fact. Back to the main topic at hand though it is difficult to reconcile catalog values with real sales. I like to use stamps such as US Scott 1 and 245. Popular stamps that have a certain cachet. Unless it is a highly graded stamp they will sell day in and day out at 50 to 80 percent of catalog for sound well centered copies. C13-15 zeppelins are another item that almost never attain full catalog. I have purchased numerous sets for 50 to 75 percent of catalog. Finally, I believe in the value of a real dealer. Too many times people use the dealer term too broadly though. ebay is full of stamp sellers that frankly have zero ethics and just enough knowledge to be dangerous and that affects the way that all dealers including the good ones are viewed.

As a final point, most dealers do not charge full catalogue. The price gives us room to set prices that make sense to us. For instance for items cataloguing more than $3 I charge 22.5-56% of catalogue. To me this is eminently reasonable. So I am not suggesting that dealers should be charging 100% of catalogue unless the item in question is extraordinary, in which case even more than 100% may be completely appropriate.

Rogdcam I agree absolutely with everything you say. I think that 75-80% of catalogue is a pretty good price. If I could consistentky sell Canada #1's for 50-80% of cat for what we call commercial VF (i.e. just VF without being superb) I'd be a very happy camper. Indeed for my first three years in business that is how I tried to price. But I have come within a hair's breadth of going broke. So with a very heavy heart I've had to accept that just because I think a VF hinged stamp is perfectly collectible (I collect 1935 Silver Jubilees and most of my stamps are hinged) it doesn't mean that most collectors do. I remember when the whole NH thing was a fringe fetish. I remember dealers like Holschauer who would turn you away if you gave him an NH want list. But what used to be on the fringes is now mainstream. So I have had to lower my pricing on blue chip material that is nice but not superb. It breaks my heart, not because I am greedy. Quite the contrary. I walked away from a six figure accounting career to serve philately. I just fear for my ability to make a living at those price levels. But I have to try.

I regularly see clean, well-presented and deep specialized collections sell at auction for 10% of CV or less. If they made any money, it sure wasn't much.

Scarce stamps that, twenty years ago, would have been parted out and sold as a separate lot, are often found in big lots and collections nowadays at auction too.

Your statement might have been true fifty years ago. I think it's dicey today.




And here I must adamantly disagree. There is one and only one reason to collect, and it's the first one: you enjoy it.

Stamp collecting is a hobby where, at the end of the day, your heirs may recoup a portion of what you spent. Most stamps today, adjusted for inflation, trade for less than they did in the 1940s and 1950s.

Even if you're buying only top grade, rare material, after inflation and whatever juice the auction house takes, you'll get, at best, appreciation on the level of Treasury bonds or CDs. Just look at the current #594 thread: this is one of the rarest of US stamps, a stamp almost every collector wants to have. It sells for less today, adjusted for inflation, than it did in 1940. That's the best of the best. Good luck out there!

About the best "investment" you can make in stamps is to get lucky and purchase a pane of rare errors at face value at the P.O., or stumble upon a stamp album in a used book store with loads of goodies. You can make real money in situations like that.

Note that this is not a "pessimistic" take. This is better than most hobbies! Hobbies are for fun, not money. At least "finds" are possible in our hobby. People who talk about the "money" in stamps, though, just want to sell you overpriced stamps.




...then you're barking up the wrong tree. If you want to invest, invest. If you want to collect, collect. If you approach the stamp market with a collector's mindset, you will not make money. If you approach the stamp market with an investor's mindset... you will walk away and look for something else, because the energy spent looking for undervalued stamps that might (if you're lucky) hold value against inflation would be much, much better spent purchasing stocks or bonds or real estate that can appreciate in value above and beyond inflation, as well as potentially generating income through dividends, interest, or rent.

Interestingly, collectible prices show correlation to stock and bond markets, so it's not even a way to usefully diversify a portfolio.




Comparing a commodity market (stamps) with an investment market (real estate) is just... Real estate throws off income and you can calculate a value based on cash flow discounted for risk over time; this'll provide a solid floor as long as the starting assumptions are realistic. Nobody will let an income-generating instrument sell for less than the value of its income. The former market has no intrinsic value beyond whatever collectors (a declining demographic) are willing to pay at the moment.

If we're talking about bulk mint stamps that remain postally valid, there is something of a "floor" (though very low) provided by the discount postage market, but stamps can and are demonetized, so that isn't a sure thing either.




All the stamp collecting world needs is some positive energy. Then young people will want to play with stamp albums instead of Playstations.

People used to collect Indian arrowheads, cigar boxes, barbed wire, and prepaid telephone cards (remember those?)

Some people even still do collect those things! They don't, in general, complain about the state of the market. This is because they enjoy collecting, and don't pretend that there's much money in it.

Incidentally, remember when Amos Press sent out phone card magazines free to subscribers of Linn's? And how there were big ads and positive articles full of happy talk about the vibrant new collecting field in the stamp collecting press? How long did "positive energy" keep that alive?

Blatantly pushing things can hurt more than it helps.




The money I spend on stamps is hobby money. I fully expect it to be gone forever -- that's the position sensible collectors should take.

I would also love to get more young people passionate about stamps. I see my nieces every week, and I share my hobby with them. They love the neat tricks I can do, like make my stamps glow under UV light. They think it's a good time. Maybe if I'm lucky one or both of them will take up an interest in the hobby, if not now then some years down the line.

If you want to get young people hooked, that's what you do. Share with them. Give them bags of stamps. (And not stamps that are damaged -- I saw somebody suggest that in the "do you ever throw stamps away" thread. Kids don't want stamps that are beat up, either.)

Don't tell them that stamps are "worth money" and that it's something where values increase (for the last forty years or so, they don't). I do not have to power to make the stamp market go back up, beyond my bid on the items I want of course. You have no more power than that, either.

Taking them to stamp clubs or stamp shows can backfire spectacularly, I've found. They'll take a machete, cut their way through the jungle of gray beards, and make it to the nearest exit.




So, comic books, sports cards, maybe coins if they want something old-school? Most kids aren't interested in stamps, sadly.

Some are interested though! And that's awesome. But I don't play those kids a Pied Piper tune about the state of things. They are well aware it's both a "sausage fest" and a "grandpa hobby", and they don't want to hear me lie about that.

Most of the young collectors I know I met over the Internet or through Postcrossing. They have different tastes than older collectors, as you correctly point out. They hang out in different places and are far more into virtual exhibiting than exhibiting at a live show. They're mostly in other countries. Many are in the developing world.

Many of them will never be interested in "classics". They're in places like Pakistan, Lebanon, Nigeria -- artifacts of colonial times aren't all that popular with people in those areas, for some reason. Post-independence stamps from their countries are generally well liked.

Maybe focusing more on modern stamps or topicals might help with stamp collecting outreach, but I'm not sure about that.




Just like I don't believe I have the power to revive the stamp market, I also don't believe I have the power to bring it down. Negative energy is not the enemy of philately. Demographics are.




I am sorry if my tone seems harsh. It is. It absolutely is.

In principle, I don't disagree with the point of your manifesto: we need to attract more young people in the hobby. I would love to do that, I would love to be able to bring thousands of young people into collecting.

However, it wasn't an older collector that brought me into the hobby; it was my non-collecting parents buying me some stamp packets and hinges. Maybe, instead of pretending that the hobby is growing, we should just give out stamp packets and bags of hinges to friends and family? People on the street? (That wouldn't be weird, would it?)

And certainly I wasn't attracted to the hobby by stories of how strong and vibrant it was. The stamps spoke for themselves -- they were neat. I knew that I wanted to collect stamps, regardless of how popular it was. No stories. Just stamps.




Sometimes the truth ain't pretty. Hell, here's one: postage stamps, as we know them, may not even exist in fifty years.

That does not mean the future is necessarily bleak, however. I believe that philately will still be around in 100 years. It'll just be different.

People will still collect them then, but I suspect the environment will be more like the 1860s and 1870s -- very few pro dealers, mostly just collectors trading with other collectors. It'll be a fine world.




Given the general thrust and tenor of the rest of your post, this brought me a chuckle. I think, if you think about it, you will chuckle too.

Back to the original question:

"Do you think it's the market value that influences the catalogue value or it's the catalague (Scott for instance) that influences the market value ?"

I think the answer is both. In the absence of specialized knowledge, dealers and sellers, whether amateur or professional, will use the catalogue value (CV) as the benchmark when setting prices, usually taking a rough "percentage of CV" as their selling price. However, they will adjust this in the light of their knowledge of actual market values.

Compilers of catalogues will take account changes in market values, but will tend to err on the side of caution in lowering CVs, and likewise, are usually behind the curve when it comes to rapidly rising prices, for areas that are currently very hot -- over the past couple of decades many China stamps were selling over CV, only for CVs to chase them upwards.

Due to limited resources, catalogue compilers tend to restrict their price revisions to areas of greater popularity where there have been very substantial changes.

I don't agree with any of you ------Blowing a lot of smoke and thinking too hard .

First ---- Catalog prices have not been accurate for 50 years .There is a group of clowns oops I wanted to say Professional Philatelist who believe they must keep raising prices to confirm to their customers it is a good thing to spend money on stamps . Which they have to sell to you .

Second ---The whole model of stamp pricing used by the catalogs has been destroyed in this changing world . I had a friend who worked for Scott's and Len did the pricing of groups of countries each year and major price changes for each country came around once every 4 or 5 years .He used dealer price list and dealer ads in major philatelic publications. Both have been disappearing over the past 30 years and now very little stamps are sold that way . So the whole model of pricing has disappeared .So where does the catalogs get their pricing --THEY DON'T.

Third ----Dealers don't carry extensive inventories of any country ,all dealers have piece meal inventories and many of those are not adding to it they all seem to be on closeout of their inventory . I met a lot of dealers who are looking for inventory at 5% -10% to purchase and want to sell at shows at 50% of catalog and offer you get deals [YEA no problem to sell at 5X to 10X their price] .

Floortrader, as I said, if you rely on dealer prices for cat it is a recursive pricing model that reinforces inflated numbers, benefiting only the dealers. Not surprising for a private catalog company that also takes advertising dollars, from... Yes dealers!

I believe it's not a benchmark. Maybe for an upper limit that you would pay for wildly expensive stamps.

I garner much more value from eyeballing realization prices on SAN by using closed auction search.

Maybe the solution is to open source pricing and create the "invoice" price, which is above dealer cost, but reflects inherent overhead (handling,shipping,storing,insurance). Auctions aren't free after all.

SCV can continue to be MSRP but it's fiction

Although the subject matter, or the specific opinions on this subject matter, may be seen as negative in this thread, it was asked, and there have been many responses. The world isn't full of rainbows and pixie dust around every corner! This entire site is attended mostly by experienced collectors. The beginners here tend to be asking something like, "Is my stamp a #594" (FYI, the answer is "NO"!). My take on this thread ISN'T that we are discouraging participation in this hobby. Frankly, everybody should probably be reading this thread. Hopefully they will learn some of the monetary facts in this hobby, warts and all. Burying one's head in the sand is stupid. What we don't know COULD hurt us! So now that a not-so-positive subject is brought up, let's pull our heads out (OF THE SAND!!) and talk about it.

I have worked for a few auction houses as a describer, so I am not ignorant of the economic facts in the hobby. I changed careers (now in the airline industry) because I found that I was losing interest in the hobby. I found that I was thinking of every personal purchase in terms of dollars, cents, profit, and customers that would be 'targeted' when I decided to sell. Stamps went back to being a hobby for me, but I cannot help but think in terms of dollars, cents, and profit, at least occasionally because it is important. This is a hobby/pastime, just like RC cars or watching movies. A lot about those other pastimes involves outlay of money for the participants --- if you go see a movie (cuz that's your pastime), from a purely monetary POV, you will lose 100% of your $$$. But what is that smile on your face worth?? At least with stamp collecting, you have an opportunity to get some $$$ back when you are done with your collection. If you are educated on the subject (THAT is what we are discussing here), you will lose less (or make more) money than if you go out and spend willy-nilly.

Catalog Value vs Market Value?? Depends on how you define Market Value. Generally, though, I see stamps sell significantly below CV. Then again, there are times when I am more than willing to spend CV on a run-of-the-mill stamp. Mostly when the cost (and CV) is low, and I have some 'need' to own an example. At that moment, I suppose I am willing to spend more than anyone else is to attain that stamp. Generally, retail prices are greater than auction prices which are probably greater than ebay prices. Everybody can point to many, many examples that refute that statement, but I stand by it as a generality. Retail is highest because of higher overhead, and a dealer is usually willing to hang on to a stamp longer until the person willing to pay his price happens along. An auction house WILL sell the stamp on a specific day --- probably only a month or so after their auction is posted/printed. If THE person (assuming there is only one) that would be the highest bidder doesn't happen to be aware of this auction, the price goes down. The foundation for the auction industry is dealers. A dealer may have no personal interest in a particular stamp, but if he has a customer that DOES, the dealer may well be the high bidder. Also, if there is no collector interest in a particular stamp on Auction Day, a dealer on the floor may well decide to take a chance on it, believing that THE customer for that stamp may come along sometime over the next year. His high bid will be reflected in that wait, and how sure/unsure he is about how long the wait will be.

My opinion is that CV has a loose connection to MV. It is a relative thing. It depends on the issue, the era, the country, the venue, , etc, etc. At the beginning of one's foray into the hobby, they are probably spending very little, so their monetary risk is low. Any novice that is spending $50k on a stamp is an idiot. They are going to learn a lesson. At least one would THINK Mr. Moneybags would learn a lesson, at least eventually. Maybe not. Anyway, as interest grows, and time goes by (think, maturing from novice to intermediate), one has most likely learned what they should be paying for their stamps, and they are probably also spending more on their collections and buying bigger ticket items. I think the CV vs MV argument can be compared to a dog wagging his tail: If MV is the tail, and CV is the dog, even when a dog is wagging his tail (most of the motion is the tail slapping back-and-forth), the back part of the dog may also show a little motion. I think MOSTLY CV responds to the market, but the 2 are not completely decoupled. CV DOES have a bit of effect on market. Generally, I put the 'balance of power' at something like 10/90 or 20/80 for CV/MV.

But, hey, what do I know?? My thoughts work for me, and that's good enough for me.

I've often thought about starting a website to do just this -- collect actual real retail data, allow others to provide their documented transactions, etc., and provide a range of true market prices for stamps.

There are a couple problems of course. First: identifying the stamps on the site by any of the major catalogues, especially on a site giving market values, would invite legal challenges, as catalog publishers claim copyright on their numbering systems. They'd certainly go after a 'competitor' using their numbers. Legally, there is a chance this would not stand up in court (probably arguing along the lines that a chronological listing of issued stamps requires no more creative input than a telephone directory to compile, and those aren't protected by copyright.) Even so, who wants to put their neck on the line and spend thousands or tens of thousands of dollars to appear in court for this?

Then, of course, there is the question of condition. Stamps aren't fungible, two copies of the same stamp in different condition will sell for a different price. We'd probably have to do it tracking an index or a "median value" or something for each stamp. For really rare stamps that seldom trade, we could list the condition along with the price perhaps.

Why would anybody under think something.

Hahaha!!!! Well, that's what we do around here.

And let's not forget that two dealers, at two tables right next to each other, with identical examples of a particular stamp, may very well sell at two different prices. AND, perhaps after looking at Dealer A's example, a collector may buy the HIGHER PRICED example from Dealer B because he has a relationship with B. There are really no hard-and-fast rules. My point is that there is no single MV (if one defines MV as a selling price) but there IS one single CV, at any given time. The MV (if you boil it down to one number) is probably more like the high point of a bell curve representing the range of prices. Or some other point on that bell curve, more likely.

Codehappy, I would think it needs a high degree of transparency that only something like github or community source could provide. A private site/central db undermines the very intent.

Trust is paramount, and if you can't see how the sausage is made, well - you won't know what's in it.

Undisclosed transactions are irrelevant to this model. You need to validate against an auction/transaction/source or authenticated receipt. Lots of issues, but the point is you need trusted data.

I don't think I would provide an end all/be all price like a catalog value, but rather a survey of prices for N # of transactions over a period of time.

I collect rarities, typically under 100 outstanding, so I care about historical prices and last bought/sold prices. Catalog pricing does little, except help dealers and make me wait longer for opportunities to present.

Ideally I think it would look like a historical stock graph.

rismoney-Not all the people Scott talks to about cat values are specifically dealers. There are others with many decades as professionals who do not have anything to lose or gain in recommending price changes. People who do or have worked as auction describers for example, some of whom do other work in the hobby now.

Well, Github is a private site, too. As long as documenting information is included (like links to the auction, or scans of receipt, whatever), and others can make contributions (that should be similarly documented) it shouldn't much matter too much where the putative wiki/app was hosted.

Transparency would easily be obtained by providing the citations to the source of the data, and by open sourcing the code for the wiki/app.

The legal obstacles are the main problem AFAICT; though if the site was dedicated solely to rarities catalog numbers could be omitted entirely, just describe the base stamp in words. Large auction houses would be another potential source of grief though (they sell their historical price realized data; I can't imagine they'd be too pleased with the existence of such a site). My understanding is that the factual nature of the transaction data (facts themselves are uncopyrightable) would be the go-to defense, there, but having a legal defense is hardly any guarantee against being sued.

revenuecollector nailed it!




mootermutt also gets it.