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One Man's Junk is Another Man's Treasure

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Updated June 11, 2004
What distinguishes a collectible from ordinary rubbish is not always clear. Nonetheless, there are two primary characteristics that collectible items share: desirability and rarity.

DESIRABILITY
Whether it is destined for a museum or a private collection, to be collectible, an item must be desirable to someone other than the collector. So, your seventh-grade love letters probably won't qualify, unless you become famous (or notorious). But what makes something desirable?

  • Condition. Condition is so important that third-party grading services have sprung up in some collecting areas to grade and validate the quality of items. The coin collecting market is one of the best-developed examples, with 70 possible grades of coin in the Sheldon Numerical Grading System. The same Morgan dollar --a silver dollar issued primarily between 1878 and 1904--can be worth anywhere from $5 to over $100,000, depending on its condition. Do not mistake condition for perfection, however; some of the most desirable collectibles are actually mistakes. The classic example is the Inverted Jenny, a 1918 24-cent air mail stamp with an image of a Curtiss JN-4 biplane. A production error caused some sheets of the stamps to be printed with the airplane image upside down, and one of those sheets got into circulation before the mistake was noticed. Today a correctly printed Jenny stamp goes for about $100, but the inverted versions sell for up to $200,000 a piece.

  • Aesthetics. Form, color, size and materials also matter for desirability, although these preferences tend to change with popular tastes. For instance, very large items historically were not viewed as popular collectibles because of the difficulty of storing them, but this has been changing in recent years. Rudy Franchi, a vintage movie poster dealer and appraiser on Antiques Roadshow, points out, "The typical movie poster is 27 by 40 or 41 inches and is known as a 'one-sheet'. The market for larger movie posters used to languish, but people are now living in bigger homes, and so they are able to display bigger things. Now there's a big fad in buying the larger sizes, known as 'six-sheets,' that are 81 by 81 inches, as well as foreign posters, which are often larger."

    RARITY
    "There are some books that are absolutely fabulous literature, but there are too many of then," says Ken Gloss, proprietor of the Brattle Book Shop in Boston. "For instance, Shakespeare, next to the Bible, is the most commonly printed literature in the English language. It's wonderful stuff, but there are millions and millions of them so they're not worth much. You're looking for the one that's a little more unusual, that you don't see all the time."

    Items can be rare for several reasons:

  • Some items are simply uncommon and irreproducible. Among those who collect materials about signers of the Declaration of Independence, for instance, the autograph of the all-but-unknown Thomas Lynch or Button Gwinnett is worth far more than the John Hancock of, say, John Hancock.

  • In many cases, what people collect is only in short supply because they define their collecting area so narrowly. But sometimes rarity is created by the manufacturer. In the 1980s, the Swatch Group created a frenzy by selectively releasing Swatch designs to a limited number of distributors, such that every retailer had a different selection, and by limiting sales to one per person. Swatch also launched an intensive promotional campaign touting their watches as a good investment. Swatch Fever spiked, and sales in the U.S. alone increased from $3 million in 1983 to $200 million in 1987. The same strategy applied to anything manufactured in limited edition, such as Franklin Mint plates, Beanie Babies or Precious Moments figurines.

  • On the other hand, it can't be too rare. "If there's only one of something, there can only be one collector," points out David Wood, curator of the Concord Museum in Concord, Massachusetts. "What fires people up is things that are relative common, so that you can get a complete collection of it in every form and every style." These sorts of items are easier to find at antique stores, flea markets, and garage sales, adding to the serendipity of the collecting experience and fueling the motivation of the devoted collector to keep searching.

    This article, a portion of "Objects of Desire", is courtesy of the Regional Review, published by the Federal Reserve Bank of Boston. The article in its entirety, can be found on the:
    http://www.bos.frb.org/economic/nerr/rr2004/q1/objects.pdf
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