Collector anonymous

[bugbear]

The difference in collecting versus merely using is where people pay well over the market value for something.
For instance, I could buy a plain black t-shirt for a tenner. It's worth a tenner and that's it... but if I get it worn by Brad Pitt for one short 20-second scene in a movie - The actual value does not change, but collectors will pay well over $1,000 for it.

I think you'll need to be explicit about the meaning you're putting on "market value" and "actual value".

I'll start:

Market value normally means the price agreed being a willing seller, and a willing and fully informed buyer.

I'm not aware of a conventional distinction between "market value" and "actual value".

BugBear

 

[D_W]

Yes, we're generally all guessing. He just does a lot worse than my much more educated father in law. Not to disclose peoples' details, but one makes half as much as the other (and saves about half as much), but has greater net assets after investment gains.

I have a lot of experience with investments at an institutional level, and much less at a personal level (less in terms of doing anything other than dumping money into something that represents the economy at large and just allowing it to appreciate at the lowest possible expenses). I do that at a personal level, because that's generally what institutional investors do (those who need appreciation without taking on pointless unique risks).

At any rate, Krugerrands (non proof level, things that are rare often trade for more due to rarity - you can't compare them on material costs) appear to be almost the same street price as an ounce of bullion. They're recognizable and easy to test, so it would seem if someone would like to confuse a hedge for an appreciating asset, they're not that bad.

I'm sure you could find a local dealer who would add a hundred quid to the price and tell you that's the cost of doing business, but that's not really necessary to do these days.

As far as collectors, the generation who likes gold as an "investment" is mostly children of parents who lived through the great depression. There is a ceiling on the value of items (and a timing issue for investing in them - a speculative one) like gold coins. The spread isn't going to increase forever.

Reminds me of what's going on in the central US right now. Land appreciation combined with retirement of farmers who are selling the land has made rare vintage machinery really expensive. Same with muscle cars. Both of those are going through the roof because the boomer and slightly older generations who dreamed of the rare cars or the rare 100 year-old machinery are spending. The generation will disappear, and so will the appreciation in value of their fantasy items. For the rest of us, it's probably better to ignore that in general. Rare tools, rare coins, rare machines...let someone else take the risk and don't worry about the value.

Long ago, Kingshott said in one of his videos "leave those for the collectors", talking about rarer wooden planes. I agree, don't worry about it. Get the best information you can, make a rational decision and don't worry about others' irrationality.

 

[MarkDennehy]

Pretty much anyone is guessing though, aren't they?

Well, to an extent.
But investing over the long term in index funds is pretty safe, by the standards of the stock market.

Hedge funds, on the other hand... well, I've lost count of how many actual honest-to-goodness scientific studies (with peer review and published in reputable journals) there have been which showed time and again that hedge fund managers and day traders never do as well as a random number generator, whether that random number generator be a computer program picking random numbers, a dice being thrown, a coin being tossed, or some animal's behaviour being monitored (so far they've used cats, monkey and I think they've used either octopi or squid as well).

As to gold... if things ever get so bad that you want gold because the currency has collapsed, you should have invested in a shotgun, shells, dried and canned goods and a very stout door.


Personally though, I think you should invest in Walnut. If the prices over here are anything to go by, I'll need to bring two cars next time I go buy a batch of the stuff. One to bring it back home and one to leave in payment...

 

[nabs]

tasky has introduced an unnecessary confusion here - in an earlier post he said 'an item is worth what someone is willing to pay for it', which is true.

Objects do not have an intrinsic monetary value - the only thing that is relevant is what someone is willing to pay for it. This is true even if you dismantle the object and sell it as raw materials or parts.

There may be all sorts of reasons that a collector is willing to pay more for an object than your average end-users, but it has nothing to do with some magical property of intrinsic financial value.

 

[shed9]

Yes, everything has a premium that the companies apply (currently about 4%, it seems), both reduction in buying from you and increase in selling to you... But for the average person on the street, it is a 1oz piece of gold and as a benchmark it is worth (near enough) whatever the ounce value is of that gold.
Even Proof Krugerrands are valued at £1250-odd and that's maybe a 20% premium.
The premium is a given, though, just like postage & packing and can be assumed a feature of transacting, but does not form part of the actual value of the item itself.
The difference in collecting versus merely using is where people pay well over the market value for something.
For instance, I could buy a plain black t-shirt for a tenner. It's worth a tenner and that's it... but if I get it worn by Brad Pitt for one short 20-second scene in a movie - The actual value does not change, but collectors will pay well over $1,000 for it.
No investor is going to pay the collector price of £1900 for a Proof Krugerrand that is only valued at £1200.
That was the point.
To the collector, an item may be worth a lot, but also collectors items are usually only worth that to a collector.
To everyone else, it's worth the basic value, which is usually substantially less.

To the average person in the street it's a Krugerrand, same as it is to a user and / or collector and has the relevant value of a Krugerrand. Proofs fetch higher prices because of the nature of what they are, proofs. If anyone buys a proof coin at £1,900 then that is its value, not the base metal trade-in. Things are not (usually) valued based on their base component value. I appreciate that ironically basic base metals are one of the few exceptions to this rule but in reality we are not discussing stocks, shares and simple metal.

Just saying that using an investment market to highlight your view that collectors negatively skew opportunity for others does not (in my opinion) actually hold any water.

 

[Tasky]

I think you'll need to be explicit about the meaning you're putting on "market value" and "actual value".

Value (of any kind) being whatever a thing would normally sell for, be it a shop or a car boot sale, among normal users.
Price, in this instance, being what a collector would pay for it purely because of some aspect to it that they believe makes it special somehow... like THE specific $5 cheese grater that was handled by some actor in a movie.

It's not exactly important as to the financial terms used, as who is paying.

As to gold... if things ever get so bad that you want gold because the currency has collapsed, you should have invested in a shotgun, shells, dried and canned goods and a very stout door.

Knowing some people who are buying stuff because they think the Pound will collapse post-Brexit... The idea of buying gold should be sound, since other currencies won't have collapsed and they will still pay decent money for that gold...
Shotguns and things only come into play when the Zombies take over, as I understand it...

There may be all sorts of reasons that a collector is willing to pay more for an object than your average end-users, but it has nothing to do with some magical property of intrinsic financial value.

Just to be clear, I'm not trying to imply anything magical of the sort... just that collectors often do pay well over the odds for things and, in doing so, can end up pricing normal users out of the market.

Things are not (usually) valued based on their base component value.

That was the point I was trying to make with Krugerrand, though - It *is* supposed to be worth (or based on) it's current gold value (plus sales fees, obviously), to the point where they started making these special collectors versions specifically, but even then you can buy those from a bullion dealer at far lower prices than from fellow collectors...

Just saying that using an investment market to highlight your view that collectors negatively skew opportunity for others does not (in my opinion) actually hold any water.

No, that was just to highlight how collectors pay over the odds for what they could simply get at normal prices.

 

[bugbear]

No, that was just to highlight how collectors pay over the odds for what they could simply get at normal prices.

I happen to hang out with some vintage computer collectors - they would be ecstatic to pay less, if they could get stuff at "normal prices".

But what (on earth) is the "normal price" of a mid 1980's 8 bit computer, say an Atari 800, for a specific example, and where can I get some at "normal price"

BugBear

 

[Tasky]

I happen to hang out with some vintage computer collectors - they would be ecstatic to pay less, if they could get stuff at "normal prices".

Is it stuff that 'regular' people also want, though, or is it pretty much just other collectors buying it?
If the latter, tell them to stay away from mechanics in Reading, as I know one who often throws out stuff like this, much to my own objections!!

But what (on earth) is the "normal price" of a mid 1980's 8 bit computer, say an Atari 800, for a specific example, and where can I get some at "normal price"

Depends.
Just the 800 looks to be £80-100 in working order, although there are some sold for over £250 (with 60+ games, Quickshot II, data drive, etc).
The 800XL looks to go for maybe £60-90, as an average (but again, some overinflated price examples too), so I'm guessing the lesser model?
Either way, that's less even in today's money than what we paid for a Speccy 48k back in 1984!!

But there too, some people obviously selling at normal prices, while others selling it at "OMG, look here, ultra *rare* computer" price listings...

 

[bugbear]

I happen to hang out with some vintage computer collectors - they would be ecstatic to pay less, if they could get stuff at "normal prices".

Is it stuff that 'regular' people also want, though, or is it pretty much just other collectors buying it?
If the latter, tell them to stay away from mechanics in Reading, as I know one who often throws out stuff like this, much to my own objections!!

But what (on earth) is the "normal price" of a mid 1980's 8 bit computer, say an Atari 800, for a specific example, and where can I get some at "normal price"

Depends.
Just the 800 looks to be £80-100 in working order, although there are some sold for over £250 (with 60+ games, Quickshot II, data drive, etc).
The 800XL looks to go for maybe £60-90, as an average (but again, some overinflated price examples too), so I'm guessing the lesser model?
Either way, that's less even in today's money than what we paid for a Speccy 48k back in 1984!!

But there too, some people obviously selling at normal prices, while others selling it at "OMG, look here, ultra *rare* computer" price listings...

So you're saying the people buying an Atari 800 at £60 aren't collectors? What the h*ell else are they? Who else buys obselete slow bits of junk? They're simply collectors getting a good deal. They're still collectors.

The collector/users thing a false dichotomy.

BugBear

 

[Tasky]

So you're saying the people buying an Atari 800 at £60 aren't collectors?

Am I?
Sounds to me more like the opposite, really... and they're only able to get such good prices because the average computer user doesn't want them any more.
I guess that'd be like no-one except collectors wanting a Stanley 71, because most people buy the Veritas?

But by contrast, a ricketty old pile-of-junk chest made very cheaply 100 years ago now commands such a high price in the collectors' world, you'd think it belonged to the queen of Sheba. All you have to do is label something as vintage or antique and some idiot will pay too much for it.

 

[shed9]

I give up Tasky, you're using the investment sector to explain how collectors have a negative impact on it, the used vehicle and the tool market by suggesting real gold investors are mirrored by collectors who buy false investments that are dangled on a string to them. These 'false investments' I'll add that are valued by the same 'real investors' within the same sector.

I'm never going to win that argument or convince you otherwise. I can see elements of your argument but don't see it all holding together cohesively, not enough to convince me anyhow.

It could be worse, I could be wrong......

 

[bugbear]

So you're saying the people buying an Atari 800 at £60 aren't collectors?

Am I?
Sounds to me more like the opposite, really... and they're only able to get such good prices because the average computer user doesn't want them any more.

Wait, what?! Now you're saying the reason the price is low is because the users haven't driven them up?

I thought your assertion was that (evil) collectors drive prices up, to the detriment of users?

BugBear

 

[Tasky]

I give up Tasky, you're using the investment sector to explain how collectors have a negative impact on it

I never said it was negative.
For dealers in collectible gold coins, it's pretty great... All it does is rob the users of gold to invest in, which is bad from their perspective as they need it for their business, and their investors need it for theirs.

Wait, what?! Now you're saying the reason the price is low is because the users haven't driven them up?

No.... mostly. More that there are no users.
More users would create more demand, yes, but usually that puts more products onto the market. When a new iPhone comes out, for example, the previous model starts hitting the market in both cheaper new format and even cheaper second-hand. Eventually it'll be so old no-one wants to use it, so only collectors buy them, at which point a former user will value it low and a collector will assign whatever value they think it amounts to.
It generally won't hit high prices until there are fewer old models than collectors, though, or at least people present it as such which is more common these days.

But where you have users and collectors both interested in stuff, that's where it gets expensive - Sellers would rather sell to a collector than a user, because they'll pay stupid money especially if everyone thinks it's a collectors item.

I thought your assertion was that (evil) collectors drive prices up, to the detriment of users?

They can, even when the industry that hinges on it decides the 'official' value, collectors (and sellers) can inflate prices well over the odds which just takes products off the market.

 

[Rhyolith]

I think its wrong and inaccurate to put a line between users and collectors. With tools at least it seems to me that most fall somewhere in both philosophies; I certainly think I do, and I would be confident to wager that there are very few members here who have just what they need and not an single tool more.

 

[D_W]

I think its wrong and inaccurate to put a line between users and collectors. With tools at least it seems to me that most fall somewhere in both philosophies; I certainly think I do, and I would be confident to wager that there are very few members here who have just what they need and not an single tool more.

Except Charlie Stanford. He's perfect!

Kidding aside, I'm a user, collector (not intentionally, I guess, but sort of as a matter of duplication of things I like) and maker.

Where does maker come into this?

My good friend George has a large appetite for buying and keeping tools, too, and I haven't met a finer maker of any type (especially of toolmakers in general). He's mostly retired, but he was far more of a user than any of the gurus.

 

[Tasky]

Where does maker come into this?

Possibly at the point where a tool manufacturer starts doing miniature versions of all their kit?

 

[knockknock]

Where does maker come into this?

Possibly at the point where a tool manufacturer starts doing miniature versions of all their kit?

I have some of those, and a fancy little plumb bob too.

 

[Tasky]

I have some of those, and a fancy little plumb bob too.

Are the chisels and router any good?
I kinda fancy them for messing around on tiny projects!

 

[knockknock]

I have some of those, and a fancy little plumb bob too.

Are the chisels and router any good?
I kinda fancy them for messing around on tiny projects!

I haven't used them for anything, so I don't know how well they work. Also, I don't have the chisels, I only have the BUS, block, router and shoulder.

 

[Sam_Jack]

Interesting topic; but I feel there is a category missing. The ‘aficionado’. Those who accidentally ‘collect’ and end up with a collection. I’ll try to explain – many (many) years ago I found sitting on the top of a skip a bench plane; looked to be just out of the box, indeed, I found the box at the same time. It had been hurled, in disgust I assumed, into the skip by the purchaser. So, I had a look-see. The cutter looked, to my eye to be pretty good and about #4 size. Long story short, I took it home as a puzzle and perhaps spare parts. One pass over a billet explained why it had been hurled, the blooming thing was hopeless. I saw this as an opportunity to discover what, exactly, made it so. Thus began an adventure into what makes a ‘good’ plane and what made this one so bad. It took a while for me to discover the faults and frailties, but it was an enjoyable study. A study which lead me to scrub planes. In the end, I turned the junk into a very good, useful scrub plane. I still curse the depth setting (hammer) and the lateral set – by guess and by Golly, but I still reach for it when I need to take down a board – it really does a good job (once set) and the blade is a gem.

The point, well a collectors item it ain’t. Would I part with it – No. It lives with my modest ‘collection’ of hard working tools. Never, ever bought a new hand tool off the shelf. All have individual characters and I have, through use, come to know their little ways; their personality, if you will.

I don’t hoard ‘em, I do use ‘em, hard and often. There are quite a few, although I have never counted. I just know that #2 Stanley 5 will work best on some timber and grain; but #4 Stanley 5 ain’t anywhere near as good on others as the Falcon. Do I have a ‘collection’? Some would say I do, are they all artisan working tools, yes, they are. I believe I am a pragmatic aficionado, I hold that which I may use, I look after that which is of value – to me and repays my attention with stellar service. Could I toss ‘em out? Not a chance. Would I sell ‘em? No. How could I put a value on the time, effort and energy invested in tools which simply perform design function – as and when required. My work, done with my tools; tools which I know will still be functioning 50 years from today.

There, my two bob; spent as pleased me best.