Buy High Sell Low; Items For Sale

[GARY WORTHAM]

Over the years, i watch people advertise, for sale an item, that they re selling at a loss !!

 

I have a problem wrapping my head around this concept; for the status of an adult. 

 

To look and spend the high dollars for this study / hobby; one should take the high road, and know what they are doing.

 

This is a serious study / hobby; and to throw their money to the wind; is not in line with rational thoughts.

 

I looked to the future, as I study and purchase, to avoid this pitfall.

 

Simple directions are thrown to the wind, and a pure path to follow is yet to be revealed.

 

 

 

 

[PNSSHOGUN]

Do you not gain enjoyment and worth from the time you have it? Sometimes to sell you must make a loss, especially at the lower end of collecting. Losing 1-200$ on a sword I have appreciated and enjoyed for a few years isn't a big deal for me. If you look at this hobby solely as a profit/loss margin game than I think you're missing out on some major aspects.

[BIG]

If you are going to develop your collection, and develop means to get higher quality blades, you have to sell your lower blades or you accumulate and don't sell anything ( and possibly waiting longer for a new purchase).

Pay twice, with a loss selling and with more to pay for the new ones. Be sure that "hobby" is the love of your live...

 

Best Regards

[Shugyosha]

Hi Gary,

 

Not everyone judges their enjoyment of Japanese swords in terms of their bank balance.

 

If you can conceive of no possible circumstances in which someone might sell at a lower price than they bought an item for, then you need to develop an imagination and probably haven't attained the level of perfection that your professed self-discipline would suggest.

 

Have a search around the previous threads on the Board and you will get an idea of why people sell swords and why they might not always get back what they paid for them. Perhaps if you had invested some time in that piece of serious study you would be less prone to making crass statements.

 

With warmest regards,

John

[vajo]

I can only estimate the lifetime costs of a Japanese sword from making in ancient times through the generations of collectors to present.

How many polish, habakis, koshirae, shira saya have been done?

Look in the old auctions price lists. The price for nihonto was much higher than this days.

[general_piffle]

The money and time I spend on sourcing and purchasing exactly what I'm looking for are largely irrelevant as long as they are within what I can afford, on both counts. They are an investment in a hobby/study I enjoy and would no doubt eventually be spent on something else far less fascinating or beautiful.

[Michaelr]

Gary, when times are good and people have money the prices of all collectibles are high. People buy what they like or are interested in at the time. When times aren't as good people often have less money and prices are down and people buy what they like or are interested in. People collect for different reasons. Most collectors buy things that interest them for what they can afford at that time. We all hope in the back of our minds that our items will appreciate over time. That dosent always happen. I have found after many years of collecting many types of things" buy what You like and what You can afford, enjoy what you buy for as long as you own it. Enjoy it for what it is Not for what you paid for it and when the time comes to pass that item on for what ever reason get all that you can for it,At That Time! " if you ONLY collect for the reason of a investment you never take the time to enjoy what you have,because you are to worried about what it might be worth tomorrow. Believe me I have sold my collectibles for huge profits and have also lost my butt on others BUT as long as I had them I enjoyed them, studied them and was proud to share them with others. The nice thing is that when I passed them on weather at a profit or loss I knew that the new owner was also going to enjoy them for what they were.

 

 

MikeR

[Stephen]

Gary has pushed this saw before, should be getting rather dull by now.

Funny how it came back after i used the phrase in my suaka K/K sale. 

[GARY WORTHAM]

Interesting range of cheap, back hand insults, by those who do not know me; and miss the point of the topic.

 

The diminishing size of new collectors has me always concerned for the future of this study / hobby / passion.

 

I see the lack of the younger generation coming into this field, by the attendance at the sword shows, as well at our club meetings.

 

Yes, it is an expensive and more than a hobby. But the point I am eluding to, is the concept presented to the new or interested that you find acceptable to loose money.

 

I see this in the few new to the collecting, hesitate to by a better piece, and just settle for the tired, cheap, item, so not to be  at any loss; let alone do they think of resale or trading up.

 

The representation of the positive, the pitfalls to avoid, a plan of action for purchase, go much further; than the negative comments that are so often thrown for no benefit. 

[Brian]

I see nothing wrong with purchasing an art object after thorough research, enjoying it for many years, and then when selling, making a profit.
In fact, in my financial situation it is vital that I don't lose money. I don't have much else to fall back on except the various collections I hoard.
So I really don't think that all the factors above make up for losing money. You don't see people buying Picasso paintings or Chinese ancient ceramics only to be satisfied when they make a loss selling them. Value is intertwined with collecting, and ignoring it means you really don't have to worry financially anyways.

[christianmalterre]

"I looked to the future, as I study and purchase, to avoid this pitfall." you wrote Gary.

and this is honest and right!

 

but tell me- how many do collect this way? ( despite we both there´s seemingly maybe a handful of others i do know .. ) ?

 

i equally fully do agree with your´s second point you raised: " Simple directions are thrown to the wind, and a pure path to follow is yet to be revealed."

 

( as most just buy...and afterwards do look for getting answers on what they did buy them!) LOL!

 

collecting is Passion! Knowledge! and....spending money (-but only,when i do know about )-  ..( good stuff always is very expensive!)

 

nothing will ever change this.

 

Christian

[Okiiimo]

I can see how the OP can rile feathers of those that have personally experienced reselling at a loss. There are many variables that affect this "hobby" that are beyond the control of an individual collector - world economy and its effect on disposable income is one of them. New collectors will spend money however they want to and who am I to say whether their choices are right or wrong. If a new collector approaches an experienced collector for advice, the advice given will be based on the personal experience of the collector. Unless a person is one of the rare few that have never sold at a loss or is a profitable dealer, I think its safe to say that most on NMB have experienced monetary losses - especially if collecting goals/tastes change faster than it takes for the item to appreciate beyond the original cost. In today's economy, average swords purchased just a few years ago would likely sell today at a loss.

 

Gary - your post states several observations - some pointed at collectors in general and some pointed at new collectors. What are your suggestions for fixing the issue you've identified? Without a suggested remedy, the posts are nothing more than rants to which there is little discussion and certainly no consensus. Surely this thread wasn't started to invite the flames of passion from others to be directed at you right?

[Jussi Ekholm]

Someone needs to make the bad deals or nobody can make the good deals.

[Ken-Hawaii]

Don't forget that they could be lying through their teeth, too!

 

Ken

 

[Alex A]

Over the years, i watch people advertise, for sale an item, that they re selling at a loss !!

 

I have a problem wrapping my head around this concept; for the status of an adult. 

 

To look and spend the high dollars for this study / hobby; one should take the high road, and know what they are doing.

 

This is a serious study / hobby; and to throw their money to the wind; is not in line with rational thoughts.

 

I looked to the future, as I study and purchase, to avoid this pitfall.

 

Simple directions are thrown to the wind, and a pure path to follow is yet to be revealed.

 

Gary, you will probably find out that you cannot avoid this pitfall, having more knowledge does not stop you wanting stuff you cant afford.

 

Only way around it it is to let the misses know when you see something you like

 

Look at prices at dealers, Aoi for example, you think you can get the same price?. good luck with that.

[Vermithrax16]

Reminds me of when I traded stocks a bit. Never met anyone that did not make money on every single trade. Was amazing really. About unbelievable

[Alex A]

Just wanted to add, yes, there are great deals around, but if you become obsessed with getting great deals then you narrow your field.

 

Would be fantastic if every item I was after had been sat here on the board or at an arms fair at a bargain price. The truth is, they are a few and far between, sat in collectors/dealers websites or sat in private collections (and they don't give them up easily or at bargain prices). I suppose it all depends on what your looking for and whats available. Sometimes you have to pay over the odds to get what you want, sometimes takes years to find that item. Happy hunting!.

 

Ps, the only sword I have sold from a dealer for the same price was a corker, appealed to a lot of people, tokubetsu hozen, and above all, a great price from that dealer. Most of the rest from dealers has been sold at a loss, usually lose 15-20%, but hey ho, there are worse things to spend cash on. I suppose when I look back when I'm old and grey (not to far off  ), its the stuff ive owned that I will remember and be glad to have owned, not what ive spent.

[vajo]

In the last time i see some fresh polished katana, with new habaki and a new shirasaya for under 2.000 EUR. I remember some month ago you got for 2.000 EUR only old and rusty blades. For example it was unbelivable to grab a polished star stamp gendaito for for 2.500 EUR. Last year you pay for a untouched rusty star stamp in a damaged koshirae more than 1.800 EUR. And now? You got a rare Yasukuni, fresh polished in a perfect koshirae for 3.000 EUR.

 

I can't belive that someone is making a lot of money with such prices. The prices are really down.

 

On other hand i see the prices for NCO Swords and Typ98 are very stable and rise a little bit. 

[peterd]

Hi,is selling something for less than you paid for it making a loss. personally i buy to study and enjoy not to make money.

[GARY WORTHAM]

A reply to the depth ;

 

Two cuts to the education and resale;

 

1- we bought junk and are trying to dump it !! Really a dead end to the pure, new to this study !!!!!!!!!!!!

 

2- We are selling to improve our collection.

 

We'll, to enhance the new to our study / passion; we need to direct them !!!!

 

I see many say get books; but the new know nothing of what they say or how to use them.

 

This site could have a selective addition to the subjects, that  direct a step by step; on how to begin a study / purchase into this field. Really grow the true study base.

 

Each step could have a source of contacts, who would response to the level of search and direction.

 

Reasons to buy or not; before the dollar spent; would enhance the success of future purchases, and provide positive conditioning for new purchases.

 

OK, I myself go buy this purchase / buying / investment philosophy.

 

It gets my attention, I like it , the whole package is a desirable purchase, I want it, I need It, I feel it is my profile of study & collection, I need it, and OK  I have to have it; and last but most important !!!, could I be happy with this purchase if I owned it forever & could never sell it.

[drbvac]

The rise and fall of the prices occur for reasons that are not related to the intrinsic value of the blade as sometimes people need the money in a hurry. Many times dealers

will buy a blade for half of what they sold it for and to keep anything long enough for it to come back to the retail price will take a long time. Unless you get a real bargain

on a purchase there is little room over 3-5 years for it to go up in value unless you picked up something that was way underpriced but as you get into higher end blades you

pay the going rate and hang on - IN THE MEANTIME - the cost and any loss you incur is the price you paid to have that bit of history in your pocession when you owned

it because it will be around long after you are gone- if you want to see collections sold at a huge loss luck into someone selling their relatives collection and happy

to get anything for them.

 

I don't think of this collecting as a great way to make money even over 25 years and many hobbies are the same - you can buy and antique car for 15,000 spend 10,000 restoring it

and then sell it for 12.000 and get nothing for labour !!!!!!!

[md02geist]

The katana I just sold, I'm losing some on. I have thoroughly enjoyed it while I had it, and now it is time to pass it on. I don't mind taking a loss and consider it part of the cost of education.

[NihontoNewbie]

It's only money... You win some you lose some. I have lost money and made money throughout the years mainly buying and selling firearms. Losses can be just as meaningful as gains. It's the ups and downs that make it an exciting. Winning all the time can get boring. I find I appreciate things more after a loss.

 

Another thing to think about is where your spent money has gone. I have acquired a rather large Nepalese kukri collection over the years. I have no idea what they are worth now or if I would ever make my money back but it matters little to me. Just admiring what the kami's can make with little to no resources is mind boggling. It also feels good to give money to people in countries that are struggling. Fair trade deals that eliminate the middle man and give more money to the actual people that make these products puts a smile on my face. I don't care if I take a loss on items like this because my money went to the kami's and their struggling families.

[seattle1]

Hello:

 Another interesting thread, one where my position since its initial airing in the 1972 Dallas show and NBTHK shinsa, was made fairly clear through my essay published then, with the title "On Investing in Japanese Swords" in The Book of the Sword. The argument was laid out in fairly straight forward Econ. 101 terms that one should never expect to make an "investment" return on such storable tangibles as Japanese swords, which offer neither a monetary dividend or interest, in comparison with financial assets of the same  risk (!).  The argument was general and over a large population, and individual exceptions would be exceptions which might weaken the thesis, but not destroy it. The position was theoretical and not empirical, and the latter still generally awaits in the field of all arts.

 Anyway, since then what has impressed me is how much more "perfect," in the economic sense, the Japanese sword market has become. Many factors have contributed to that and the two biggest forces have probably been the widespread translation of some of the goldmine of Japanese language knowledge into Western languages, by facilitators like Harry Watson and Markus Sesko, but others as well, who can claim a real and lasting impact through their skills. The second dramatic change over time has been the internet. The impact of those events have come close, only close, to wiping out the huge market advantage once held by folks "in the know," a tiny percentage who knew price differentials East and West, sources of supply, who the deep pocket buyers were, etc., etc. These days the price for a narrowly defined representative sword, representing almost any period, school, smith level, etc., is virtually the same anywhere in the world net of taxes and transportation costs including "red tape."

 If a sword is bought today, given all the information out there and a reasonable bargaining skill balance between seller and buyer, it is likely that the price will be closer to a realistic market price than ever before. If the buyer thinks of the acquisition as something to profit from, that likelihood would be quite dependent of the time lag after purchase. To expect to buy for x dollars today and sell, for example x plus 10 % in the very near future would seem unrealistic to me, given the increasingly equal knowledge held by most prospective buyers. With the passage of time, which would allow primarily for changing tastes, that sword bought for x dollars might appreciate or depreciate in the view of prospective buyers and thus generate a gain, but perhaps a loss with equal likelihood. Once a substantial length of time between buying and selling one's "investment" has occurred it should be no surprise that the nominal selling price the owner gets might generally be expected to be higher than what he initially paid ,and that of course would be on account of the destruction of purchasing power of the dollar - we are abstracting from currency valuation issues of course - brought about by inflation. The seller might easily have sold for a higher nominal price with the same purchasing power value of cost of the item five or ten years earlier. Economists call that the money illusion and it is an endless slight of hand that makes us think we are better off when we are not.

 I think that as collectors we get a sort of psychic income from the pleasure of ownership and that is the compensation for a lower expected dollar return on a storable tangible like a Japanese sword in comparison with a higher dollar return demanded by the owner of a financial asset yielding a dividend or interest payment. Midas might differ on that view, but for most of us enjoying the beauty of a wonderful sword just has to trump counting up one's shares held by some brokerage.

 To digress on just one more point, I am not at all sure that the collecting community is shrinking. I think we should be optimistic about an interest in Japanese swords spreading to cultures and countries well beyond the usual site of Western buyers in North America and Europe, and further in our new electronic world physical presence in a person to person group is less pressing than it was decades ago. Finally it seems to me, perhaps Brian can confirm this, that new folks are posting here all the time with questions, seeking information and expressing their own interest in the Japanese sword and things that go with it. I feel strongly that while those folks might not stick around or become collectors, and most have a knowledge deficit position at the moment, they ought to be welcomed and treated with courtesy to the best of our collective ability.

 Arnold F.

[Vermithrax16]

Thanks for the great post Arnold. Plenty to digest.

[Alan F]

 

 

This is a serious study / hobby; and to throw their money to the wind; is not in line with rational thoughts.

 

 

 

Of course it isn't rational. But is it rational to buy any sword, even for the well educated and discerning collector who finds a nice item which fits in with the goal of his collection, when one knows that these are relatively illiquid assets (particularly the higher priced swords)?

Art in general is an illiquid asset. Not just nihonto. Although you'd probably be better off buying historical artwork (paintings) if you are worried about getting your investment back. But that's not why most people buy nihonto, I trust.

 

At some point, even for the most worldly collector, isn't there some degree of irrational exuberance and emotion that plays a part in the decision (or impulse) to buy a particular sword?

I agree with what you said in a later post that one had better be prepared to keep a sword for ever, rather than lose money (or worse, not be able to find a buyer for it). You should have added: if it is an expensive sword. I am not sure that it really matters all that much if it is an inexpensive sword which someone bought with money which they might have otherwise wasted at the casino.

 

Let people have their fun. That's how more people will get involved in this hobby.

 

Alan

[Ken-Hawaii]

 

psychic income from the pleasure of ownership

Yes, Arnold, this phrase may be the best rationale I've ever heard for owning Nihonto, or any other art, for that matter!     

 

Ken

 

[Surfson]

Great post Arnold, and numerous spot on points.

[BIG]

True words Arnold.

 

Best

[Curran]

There are many variables that affect this "hobby" that are beyond the control of an individual collector - world economy and its effect on disposable income is one of them. New collectors will spend money however they want to and who am I to say whether their choices are right or wrong. If a new collector approaches an experienced collector for advice, the advice given will be based on the personal experience of the collector. Unless a person is one of the rare few that have never sold at a loss or is a profitable dealer, I think its safe to say that most on NMB have experienced monetary losses - especially if collecting goals/tastes change faster than it takes for the item to appreciate beyond the original cost. In today's economy, average swords purchased just a few years ago would likely sell today at a loss.

 

+1 to Allan's reply.

__________________

 

From Arnold's reply, I would agree that it is globalizing.

After 2008-2009 Great Recession [Depression in this part of the USA] impact on my family, I sold down over half of my fittings collection- much of it to North America, Japan, and Europe.

Since then, I have slowly tightened some more but now am only selling on a 1:1 whenever I take something in.

When I do sell any fitting above the $1000 mark in the last 2 years since operating on a 1:1 neutral buoyancy, it almost always goes international and increasingly to countries with which I have not dealt prior to 3 or 4 years ago.