Pete Kendall's Socio Times: A Socionomic Commentary

February 27, 2007
Honus Card Sells for $2.35 million
Anonymous collector pays record-setting price
The "Mona Lisa" of baseball memorabilia, an almost mint condition 1909 Honus Wagner tobacco card, arrived in Los Angeles on Tuesday in the company of an armed guard but without its new owner who shelled out most of a record $2.35 million for it.

"The T206 Honus Wagner card has long been recognized as the most iconic, highly coveted and valuable object in the field of sports memorabilia," said Dan Imler, managing director of SCP Auctions. "Its legacy has transcended popular culture."

He and SCP's president, David Kohler, went on to rattle off a raft of facts and figures about the Wagner card, omitting only the name of the person who bought it.

The previous owner, Brian Seigel of Las Vegas, paid a record $1,265,000 when he bought it in 2000. Previous owners have included hockey great Wayne Gretzky and Bruce McNall, former owner of the Los Angeles Kings, who paid $451,000 for it in 1991.

"Some people have referred to it as the Mona Lisa of baseball cards," Imler said. "Somebody who desires to own the very best of something, this is it."
Associated Press



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A Walk-off Home Run For Honus Wagner Baseball Card?
Category: NEWS
By: Pete Kendall, February 28, 2007

Collectors and investors can convince themselves that a piece of art, a baseball card or a coin is worth ten times more than it was a decade ago because they can afford to. However, the deflation in asset values has only begun. When an economy deflates, there is no place to hide but cash, and cash is out of fashion in the investment world.
The Elliott Wave Theorist, June 1990

h wagner I see a Horace Wagner baseball card sold for a record $2.3 million just as the market was topping out.  The "Holy Grail" of baseball cards. I enjoy the Elliot Wave newsletters.
-- Peter Eisengruber

The comment from The Elliott Wave Theorist in 1990 was followed by a steep correction in stocks as well as baseball card prices. As The Elliott Wave Financial Forecast, explained back in June 2004 (see Additional References below), the peak that has been under construction over the last several years is a much larger degree version of the one that preceded the initial war with Iraq in that year. Like the larger scope of the more recent conflict and much higher prices now being paid for works of art, the escalation in baseball prices signals the arrival of a much more important peak in social mood. As we said in 2004, this time outright deflation, and not just the disinflationary spell that hit in 1990 is likely. The same card sold for $451,000 in 1991. It was then sold in July 2000, a few months after the S&P’s all-time peak for $1.265 million. The recent price of $2.35 million means the gain from the early 1990s peak is 5.2%, or roughly equivalent to the NASDAQ’s gain of 5.3% from its July 1990 peak to its February high.  Baseball cards and stocks are riding the same waves. They went up in sync, and they should come down down together.

Postscript from Susan W: Gotta love the last line of the piece about the people bidding on the Batmobile: ``These guys just had to have it,'' he said. ``It was a `Kapow!' moment.''
Batmobile Fetches 119,000 Pounds After Bidding War
Feb. 28 (Bloomberg) -- A shopper with 119,000 pounds ($233,000) to spare went away with a vehicle fit for a superhero when a Batmobile from the 1960s television series ``Batman'' was sold at auction yesterday.
The television series ran from 1966 to 1968.

Additional References
June 2004, EWFF
Add paintings to the list of “things” that have again become the object of investors’ affections. The art market just had its biggest month since May 1990. In addition to the all-time record price for a painting, $104.2 million for Picasso’s “Boy With a Pipe”, new records were set for works by a host of contemporary artists such as Jackson Pollack and 13 others. The obsession with paintings and other collectibles is an extension of the panic for stuff, which the April issue characterized as a curtain call for the mania’s post-peak echo. It is a twin to the high of May 1990, which was also accompanied by a spike in commodity prices and a brief burst in consumer prices. As disinflation re-asserted itself, however, a debacle referred to in art circles as the “nightmare of 1991” ensued. This time, the problem is not disinflation but outright deflation, so the coming downward pressure and collapse in art prices should be far deeper than in the early 1990s.

The art market’s rise in the wake of the 1987 stock market crash showed that art prices are not strictly commodities. Their price is also influenced by social mood as reflected by stock prices and regulated by the Wave Principle. Art prices appear to save their boldest moves for the aftermath of big advances, as well-heeled investors can afford to bid up “quality” works of art. The first great blow-out bid for a work of art, for instance, came right after the end of Primary 3 in 1987. On November 11, 1987, Australian entrepreneur Alan Bond made his famous, and eventually ill-fated, purchase of Vincent Van Gogh’s “Irises.” In November 1989, just one month after a record high in the Value Line Arithematic Index, two more big-ticket paintings were sold. In May 1990, when the Dow Jones Composite, NASDAQ and Value Line had all recorded important peaks that would soon be confirmed by the Dow Industrials, the art market reached its great peak with the highest sales volume in history and a record price of $82.5 million for Van Gogh’s “Portrait of Dr. Gachet.” Here’s what The Elliott Wave Theorist said about the explosion as it was taking place:
What we are witnessing is one mania, an investment mania, with various outlets, art being one of them. What might surprise people is how closely the timing of their impulses and corrections is related. When the stock market finally tops out, art prices won’t be far behind.

The forecast was quickly followed by a washout for stocks (particularly in the Value Line and Dow Transport averages) that was even harder on buyers of art. Once again, the art market has carried to new heights in the wake of a Primary degree peak. A comparison to the peak of 1990 reveals many internal signals that the rally is on much weaker footing than its 1990 predecessor. For one thing, even though Picasso’s “Boy” finally broke the record set by Van Gogh’s “Dr. Gachet,” Artprice.com’s paintings index shows that the overall market for paintings is still below its level in 1990.

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