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Home » Invest, Lifestyle Finance

Lessons from The Greatest Undocumented Investment Bubble in Modern History

Last updated by on 24 Comments

Around the same time, every Saturday, I’d pocket my $1 weekly allowance (not a typo), and head down to the local ice cream parlor on my bike.

I’d throw down my crumpled up dollar on the counter and ask to buy two fresh wax packs of Topps, Fleer, or Donruss baseball cards. I’d promptly open them right then and there, throw the rock-hard bubble gum stick aside, and sift through the 15 or so cards as fast as I possibly could in the hopes of scoring a Ken Griffey Jr. or Frank Thomas rookie card. At the time, each were valued at anywhere from $4 – $8, according to various reputable pricing publications like Beckett Magazine. I would stock up. It became a bit of an obsession.

I wasn’t alone.

Anyone who was anyone pulled out their best cards and alphabetically placed them in to 9-slots-per-page plastic card holders in a gigantic 3-ring binder. The larger the binder, the more studly you were.

junk wax era investment bubbleOnce a week, or maybe it was per day, the neighborhood boys would get together and wheel and deal. Two Canseco’s for a Griffey? Gut-wrencher. Minutes after making a bad trade, trader’s regret could overwhelm your soul and lead to a brawl if the cards were not promptly traded back.

The year was 1989. And outside of your Nintendo collection (my parents didn’t get that nobody else had an Atari 7800, unfortunately), your social status amongst the boys in your neighborhood was only as good as how many Thomas, Griffey Jr., Mark McGwire, Jose Canseco, Gary Sheffield, Shaquille O’Neal, Larry Johnson (remember him?), and Michael Jordan cards you had.

At that age, buying baseball and basketball cards was not only good for your social status – it was good for your future! It was THE investment for anyone too young to buy a real investment.

Where else in the world could you get an immediate 10X return on your investment and even a bonus piece of bubble gum that would make any family dentist cower in fear? Why hadn’t older and supposedly wiser adults figured out this brilliant investment strategy? Apparently some had, and were stock-piling unopened boxes, with the genius plan of later flipping them in order to pay for their children’s college education. Baseball cards were deemed to be a wise and diversified part of an investment portfolio.

And, of course, we had all heard stories about the 1909 Honus Wagner card that auctioned for millions. Just imagine how much our impressive collections would be worth 25, 50, or even 75 years from now! How many future Honus Wagner instant lottery winners were we unearthing, each week, from the spirited confines of a local ice cream parlor, toy store, arcade, gas station, or grocery store?

History has proven a different story. Unaffectionately referred to as the “Junk Wax Era,” the period of 1987 to 1993 proved to be the ultimate bubble in sports card history. It has been estimated that tens (maybe hundreds) of billions of cards were produced annually (the private companies that produced them never released production figures) and sold so cheaply, that their value, 25 years after production, is worth absolutely nothing. Nobody will buy them. In fact, I had my collection listed on Craigslist for over a year and it, to this day, is the only item I have been unsuccessful in trying to sell on Craigslist.

Sadly, those pricing guides we all deemed trustworthy were happy co-conspirators in the fleecing. They were the authoritative stock price listing guide for the Junk Wax Era. The more the over-produced cards were deemed to be worth, the more legit the market was made out to be, and the more magazines they sold (Beckett’s monthly circulation passed 1 million at it’s height). The lack of scarcity that made older cards so valuable apparently didn’t apply on the flip side.

The result? The Junk Wax Era of sports cards could have been the most over-hyped, over-bought in history for any type of collectible or investment OF ANY KIND. Sure, it would pale in comparison to the tech crash or Great Recession in terms of actual money lost, but in terms of subsequent worth? The market was so flooded with supply that there is no demand and no value, even 25 years later. You cannot resell. The collection is actually worth more as fire tinder than as collectible items. And unlike previous stock market crashes – no amount of time will recover my initial “investment”. I got burned by the greatest undocumented investment bubble in modern history.

“Investors” in the junk wax era make Beanie Babies “investors” look like Warren Buffett, in comparison.

So… I have a choice.

I could hold on to the collection, with the pitiful hope that I might somehow outlast the tens of millions of others still holding on to theirs so that one day someone might actually have an interest in purchasing the cards.

Or… I cast the hundreds of allowances of decades past aside, further declutter my home, and acknowledge (at least to myself, if nobody else) what happens when you follow the herd.

I am going to burn my collection (minus a few Griffey Jr.’s).

Chris Sabo? Burn. David Justice? Toast. David Wells? A bit grizzly, but well done and crispy on the outside. Al Leiter? Burn in hell, you dirty rotten @%#$#%!!!

Yes, I’m going to eat my losses. But the hard lessons learned from the greatest undocumented investment bubble and crash in modern history? They’re priceless.

  1. Don’t follow the herd – with collectibles, in the stock market, or anywhere else.
  2. Collectibles are only valuable when scarce.
  3. Mass produced collectibles are never scarce.
  4. Chasing after collectibles is almost always a money losing proposition.
  5. Anything that comes with a stick of bubble gum should not be taken seriously.

About the Author
I am G.E. Miller, & this is my story. My goal is financial independence ASAP. If you share that goal, join me & 7,500+ others by getting FREE email updates. You'll also find every post by category & every post in order.


24 Comments »
  • Deke says:

    Awesome article! I’ve pondered this very thing before. I remember going to my local sporting good store, and they’d have the “ultra collectible” cards (generally rookie/MVP cards of the current big names) displayed behind the counter, selling for $10, $20, $50 dollars. Of course, I never had the money to buy those, so I just had to get lucky and find them in a pack. Now, they’re pretty much worthless.

    That being said, I like to just think of them like a toy from childhood. At the time, I derived enjoyment from them, and maybe that was worth it? I just feel fortunate that we were kids at the time, and weren’t able to shell out huge sums to be blown on such a terrible investment. I’m sure there are some 30,40,50-somethings that got burned pretty bad.

  • Bill says:

    Great post! Your description of neighbor trades made me grin. It mirrored my experience completely. One card I still cherish is my Michael Jordan baseball card. This occurred after his father died and got tied of basketball. It reminds of the good old days.

  • jared says:

    Still have a Topps complete 1987 set somewhere in my parents’ house… at least its not eating up space in my tiny apartment… thanks for the memories and analysis… let ‘em burn

  • Micah says:

    Do you still have that Billy Ripken card? Surely that has some resale value.

  • Are none of the cards worth anything? Jerry Rice rookie card. Jordan cards… all pretty much worthless? I have been decluttering and came across my 3-4 big boxes of all these guys. Larry Bird, Magic Johnson, etc. Worthless? I haven’t taken the time to look them up…

    Those were some fun times, I must say. My best friend and I became such avid collectors of Michael Jordan cards that we both stopped ever trading a Jordan. So in order to trade a jordan, we had a rule – Jordan for Jordan straightup trade. That was the only way – I mean common, who would be willing to decrease their jordan collection?

    • G.E. Miller says:

      In general, the only cards worth anything from that era are rare error cards and rookie cards of current/future Hall of Famers. And they generally have to be graded by, none other than…. Beckett.
      You can always check EBay before setting yours ablaze. 25 years later, the verdicts are in on the players.

  • Jon says:

    I agree completely! What if guys our age actually started collecting in the early 80s when we were in grade school. Remember all the error cards they intentionally made to scarce it up a bit.

  • nanette says:

    hi there..just reading this convo and feeling the joy those cards brought you as a child were worth the total depletion of your allowances. You can buy, invest or save enough to make up for those memories! Sometimes money can buy happiness! Happy holidays!

  • Mr. Grump says:

    Sadly, I fell for this “investment strategy” as a young grump as well. The memories of riding to the card shop are some of the best ones from my child hood, so I am not it’s the worst investment I made as a youngster. This article did make think about all the other collectibles or “investments” people (my parents and I) made over the years. Tamagotchis, beanie babies, cabbage patch dolls, nintendo wii fit, game boy color. Some proved more profitable then others but the memories are fun to look back on and laugh…or cry.

    Mr. Grump

  • Jeremy says:

    I know in my brain that they don’t have any real value anymore, but I just can’t believe it in my heart yet. My dad started my collection before I got into it and lived vicariously through me after I lost interest in high school. Because of his collecting on my behalf, I have the Topps box sets for every year from my birth (1984) to present day. I’m sure he dropped a pretty penny on them, but he can afford it. Like many collectibles, it’s more of an emotional heirloom than an investment. I’ll keep holding on to them and hope that some day, there is some value in a large mint condition collection. If not, I’ll tell my son about how great the early 90′s were and it’ll take up room in his house some day!

  • This is true, but there is some value in the fun and entertainment you had with your friends as a kid. You would have felt pretty left out if you never purchased any cards and all your friends were comparing collections and trading amongst each other.

  • Garrett says:

    Ah, man. Sounds like we’re in the same boat. I remember shoveling dirt all day when I around 8 in order to make $10 to go buy cards. I think that may have actually been the time I scored a Ken Griffey Jr. rookie card.

    My uncle owns a collectibles shop and he gave me the same advice, toss the cards in the trash. I still have too much of an emotional attachment though, so they’re still stored in a trunk in my parents’ barn.

    My one hope is that some of the cards that my mom found at a yard sale from the ’60s and ’70s are worth something.

  • Samantha says:

    Reminds me of Beanie Babies from the mid-90s… adults would horde them, thinking they would be worth something. My brothers and I had a blast playing with them, we would promptly (GASP) remove the tags so ours are worth nothing.

  • Loved this post! Especially #5 on your lessons learned :) I think you could also add in that some things are only as valuable as people think they are.. which can really lead you astray if you buy into the hype. I guess that’s sort of the same idea behind why you should avoid a get-rich-quick scheme.

  • Warren says:

    Here’s an even worse example. In 1992, DC comics published a series of comics about the death of Superman. Some people bought them by the dozens, along with protective covers to keep them in pristine condition so that they would be worth thousands in the future. The expected worth of these “Death of Superman” comics is probably greater than the national debt. The actual worth probably is less than the cost of the gasoline needed to drive a car to the recycling center to get rid of the comics.

  • Jason says:

    Yep, I decided a few years ago that the vast majority of my baseball cards were worth more in the recycling bin than using up valuable space and moving around with me every year or two. I kept the ones that were worth at least a few dollars, not only for their monetary value, but also to retain some connection to those memories. But it does serve to remind us that the expectations of the crowd usually become a self-fulfilling prophecy in the other direction.

  • Jacob says:

    So much yes! I have about 10,000 cards in a HUGE box just sitting. Waiting.

    I think I’m with you. I’ll save my 2 Upper Deck Griffey’s for nostalgia (not worth the $160 Beckett had them at during the height), but have sentimental value, as I’m from Seattle. Also, might hang onto my Tony Gwynn rookie, though in terrible condition.

    Outside of that…..my mother-in-law bought a cabin with a wood stove….should make great fire starter.

  • PK says:

    I think everyone who might be wise must go through these mistakes in one form or another. You just hope that your wounds are not so deep that you can’t lick them in a quiet corner somewhere.

  • Jared says:

    Great article. Im 30 now, with about 600 pounds of baseball cards from the era. Im not lying. My son, whos 7 is getting into the card collection now. So i pay him with rubber band stacks of cards for chores that he does. So they do have some value. Btw, the nolan ryan card of him with the bloody lip will forever be my fav.!

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