Antiques vs Pokémon

Long before we had Pokémon cards we had a dynamic market for antiques: an ecosystem of buyers and sellers trading rare items from across the history of humanity.

The antiques trade laid the foundation for modern collectibles markets.

In the book Killer Stuff and Tons of Money, the author, Maureen Stanton, follows an anonymous antiques dealer (given the name “Curt Avery” in the book) from market to market and auction to auction, to better understand how they can carve out a living searching for treasure in the world of antiques.

Because, the antiques trade really is like a treasure hunt. An antiques dealer must:

1. Have an extensive knowledge of the history of civilization - how people lived, where they lived, what tools they used, and more.

2. Understand the deep history of every class of item: from specific types of furniture, to the variety of butter churns that were used for decades to hundreds of years, and what makes each special (and rare).

3. Be able to discern the real antiques from the fakes. (Dupes are everywhere in these markets!).

4. Maintain an encyclopaedic knowledge of the types prices collectors across each of these categories are willing to pay.

5. Know where to find collectors of each items niche that you can bring this item too in order to fetch top dollar… and

6. Be willing to spend their days travelling the country and digging through wares in order to discover the few items of great value: they need to find the treasure.

The antiques market operates on a strictly “seller beware” model: sellers are expected to know the true value of what they have, and buyers have no ethical or legal obligation to inform a seller when they get it wrong.

If the buyer has better information about an item, they can use that to their advantage buy buying underpriced items from ignorant sellers, and flipping it for its true value.

This isn’t just part of the antiques trade: it’s celebrated! Everyone respects a dealer who finds a hidden gem and brings it to market for its true value.

In the book, Ms. Stanton describes endless scenarios where one antiques dealer buys an item from a vendor, only to immediately resell it for a profit at the very same show.

The entire antiques market operates on this principle of information asymmetry. And, in many ways, it has to. The scope of the antiques market is bafflingly large, and the amount of knowledge and experience needed to navigate it successfully is equally so.

The difficulty of obtaining and maintaining the amount of knowledge that is needed to navigate these markets successfully is why it works. It’s also why people with a passion for antiques have so much respect for the people who can pull it off, and earn a great livelihood in the process.

But, What About Pokémon?

As I read more about the antiques industry, I was struck by the similarities and differences between it and the markets for modern pop culture collectibles like Pokémon.

In particular: the Pokémon market has developed multiple tools and services that have eliminated the ambiguity of the antiques market. In particular: card grading.

The promise of card grading is two-fold: confirm the authenticity of the item, and compress all the variables that define the condition of a card into one, simple to understand, number.

And, with the authenticity and condition of a card so easily replaced by a grading company score, the information asymmetry that defines the antiques market is… gone. Anyone can look up sales prices for a PSA-graded card on eBay and get a feel for what it’s worth. No skill required.

But this isn’t all bad: it makes collecting Pokémon cards a lot more accessible than antiques. It’s not that hard to make fair purchases in Pokémon.

And, like the antiques dealers in the books, the Pokémon dealers who specialize in flipping collections still display the kinds of skills we see from antiques dealers: they still understand which cards in a collection are worth grading, including being able to effectively evaluate the graded score they might get.

Overall, the presence of grading companies is likely a good thing for Pokémon. It certainly seems to be positive in other markets that have adopted it, like comic books and rare coins.

But I’m increasingly struck by the impacts it has on the market, and the way grading services lower the bar of entry, but perhaps also shift the psychology of the market…

This won’t be the last time we discuss card grading here.

As usual, thanks so much for reading the TCG Buyers Club newsletter. My name’s Grey, I buy cardboard, and I’m on a mission to make collecting and investing in Pokémon simple.

Cheers 🍻