I'm Sorry, But You are Mistaken.

Ask someone what something is worth and you invariably get several answers.  One may argue that an item is worth what an appraiser values it for.  Another may say that a collectible is worth what the price guide says its worth.

In my business there is a very simple measurement of value.  An item is worth what someone is willing to pay for it...today.  Simple.  Clean.  If the guide book says your Hummel figurine is worth $100, it means nothing unless there is a check made out to you stapled to that page.  If four bidders are competing for it at one of our sales and it sells for $25 to the highest bidder... Guess what?  It's worth $25.  Books and appraisers (I am one) can say anything they want.  Real value is accompanied by cash or good check.

The problem is that value fluctuates.  Once upon a time Hummel figurines were hot.  We rarely ever sold one for less than $50 and $200 or more wasn't unheard of.  Then came eBay.  Suddenly everyone with a computer and rudimentary digital photography skills was listing grandma's Hummels on eBay.  In no time there were literally tens of thousands for sale at any given time.  The world was awash in a Hummel tsunami.  If you were searching for one, all you had to do was pop onto eBay and there were fourteen of the same one listed.  The market became flooded and prices plummeted.  Now we don't see those old prices anymore.  Not by a long shot.

But what about the $119.95 your aunt paid for that Christmas Hummel ten years ago?  Guess what......

When I explain that process, nobody wants to believe me.  "But the book says its worth $100..."

I go on that I'd love to get $200 for it at auction since I work on commission, but it won't happen.

Nobody wants to admit that an "investment" went bad so sometimes I'll even hear a response like..."Well, I guess you don't get the right kind of collectors at your sales.  Can you recommend another place I can sell this?"

Thinking like this is a huge obstacle to releasing possessions and wastes enormous amounts of time as the search for a better price commences.  If I bought IBM stock at $100 last week and it closes at $70 today, I can't make any arguments about why it should still fetch $100 even if I can produce a copy of last week's Wall Street Journal that shows it priced at $100.  The market says $70.  End of conversation.

Rule of thumb:  The value of something today often has absolutely nothing to do with what was paid for it.

Market forces are beyond my control or anyone else's for that matter.  I'm flattered that people often see me as some sort of deity with the ability to wave my magic gavel and collect a desired price.  I wish. 

So much for that Hummel financed vacation...

More later...