Free Profitable Stamps Search! Enter Your Topic Below:

Chapter 18. Is Stamp Collecting An Investment?

Throughout the pages in this book you have read much about one-stamp being more valuable than another. It has been pointed out that the various tools described are needed to identify a less valuable stamp from one of more value and that it is necessary to know the fundamentals of printing, of paper making, and many other things in order to identify each individual stamp. We have indicated that a youngster found a stamp of great value in a cheap packet of stamps, that another collector purchased a stamp for ten dollars that later was to bring over one thousand dollars at public auction. We have recounted various finds made by lucky people in the past and have indicated that such luck may also be your own if you know what to look for. All of this is true.

No one may gainsay that the search for a treasure trove is exciting or that this search has considerable opportunity for fulfillment in philately. Everyone, at one time or another in his collecting activity, makes a find that thrills him. Such a find may not be large but nevertheless the thrill will be present and the satisfaction of the moment will be great. Nor can anyone hold forth in truth that the monetary value of a collection is not of considerable interest and concern to the individual collector. Indeed this whole book has been concerned with revealing the secrets of philately so that you may not be led astray or induced to spend your money unwisely.

"Nevertheless, is the collecting of stamps an investment?"

Let us not be misled by wild and unfounded claims. It is pleasing to reflect that if we had bought a couple of sheets of the Norse American stamps when they were first issued in 1925 our investment of seven dollars would today be worth several hundred dollars. Just as it is pleasing to reflect that had we purchased some of the common stock of some of our large corporations when they were selling for a "mere song", we could today reap a fortune. But this is hindsight, a daydream we indulge in to idle away a few moments not one to which we attach serious importance.

Stamps as an investment might be likened to unimproved real estate. So long as real estate remains unimproved it will not increase in value and will, in fact, eventually eat its head off in taxes. The true investor must consider what the interest will amount to on the money he ties up. If, as is forcibly presented by the proponents of "buy stamps for investment", it becomes necessary to hold those stamps for a "waiting period" of from ten to fifteen years before any appreciation takes place, the interest on the money invested may well eat up any profit we might hope to make.

Like unimproved real estate, if we guess right we may make a profit but we shall have to wait many a year to find out.

The plain fact of the matter is that, from a purely financial standpoint, stamps are not an investment in any real sense of the word. They may present some of the elements of speculation, which consists of buying stamps that presently have a collector's value i.e. worth to collectors more than their "face" value-but which you think are priced too low. Certainly it is not an exciting speculation to purchase unused stamps at the Post Office and wait ten or more years in the hops that you have guessed right.

The proponents of the "buy stamps and retire on the profits you will make" are great shakes at pointing out that the Ferrari collection sold for some two million dollars, that the Hind collection brought a million dollars during the world's worst depression, and that other great collections have been sold for large sums of money.

The most recent incident of this nature to come to the attention of the general public has been the sale of the collection formed by the late Alfred Caspary. The "Caspary" sales just concluded realized a total of some two million eight hundred thousand dollars.

It is interesting to note that none of the three "greats" mentioned Ferrari, Hind and Caspary ever purchased sheets of current stamps at the Post Office and waited for them to increase in value. All three purchased the world's great rarities and often paid record prices for their acquisitions.

The truth is that these collections were of great value to begin with. We have no way of knowing how much a rich man may have spent for his collection. There are sometimes records available from which we learn that "so and so" bought certain stamps for so much, which brought ten times as much when his collection was sold. I have never learned of an estate claiming a profit over cost of a collection that was sold.An exception would be the collection of the late President Franklin D. Roosevelt. Collectors and friends paid enormous prices when this collection was sold at auction. In fact, the collection brought more than twice its appraised valuation. However, this was not the philatelic value of the stamps going under the hammer; this was an abnormal personal value which the buyers attached to anything once owned by the late President.

It would be next to impossible to ascertain whether a profit had been made or lost because there is very little evidence to determine what the stamps may have cost the owner in the first place.

Stamps, admittedly, have a very high salvage value. This value is often far greater than for stocks, bonds, or other financial investments which upon the demise of the owner may have to be sold when the stock market is temporarily depressed. The salvage value of stamps is not affected by such fluctuations and may often exceed the actual cost, especially in collections that have developed a new field of collecting interest.

Because of the large auction market and the great number of professionals eager and financially able to acquire worth-while collections to almost any value, the collector can realize this salvage value rather quickly, just as quickly, in fact, as he could sell his stocks or bonds. This situation gives the collector a sense of security that might well be lacking were not such excellent facilities at his command.

I venture to say that no collector of great art ever considered his purchases an investment, although he surely knows that the painting he purchases today will have a substantial salvage value tomorrow. Without, such assurance he would never acquire the painting.

But if you ask me, what then is the "value" of stamp collecting, I have a very good answer.

First, we collect stamps for the very simple reason that all people of intelligence delight in surrounding themselves with the fine and the cultural things of life. The mere ownership of something fine and rare is a great source of satisfaction in itself. This pleasure is expressed in many ways by different persons. Some find delight in collecting antique furniture, fine china, glass, pewter and other things that either are in themselves works of art or have historical significance. Others fill their homes with paintings, etchings, fine books, autographs, and similar things indicative of the culture of our civilization. Each in his own way and according to his own tastes collects that thing in which he finds interest. If we found no more than this in stamp collecting, we should be completely satisfied. But there is much more.

Collecting stamps, as with every other hobby ever devised, is a mechanism of escape, one of those things in life in which we find genuine pleasure. Only the miser piles up "the golden grain" for the sake of the money itself. Only the hermit prefers to live in solitude apart from his fellow man. The rest of us look upon money as a means of providing us with something in which we find pleasure, something that will take us out of our self imposed routine of life and make us forget for the while the travail of mere existence. The collecting of stamps is one of the most satisfying of all avocations. It provides us with a whole new world to explore. It satisfies the yearning for knowledge of faraway places. It stimulates our interest in myriad subjects of history and technology which would not be available to us otherwise. No one sits down to read an encyclopedia for it is a reference book to be consulted when we wish to know a particular thing. Stamp collecting constantly pricks our curiosity and sends us scurrying through the pages of many reference books. Stamp collecting provides us with the wonder of the unusual, the thrill of the unknown. It takes us to the farthest corners of the earth and even beyond into the universe itself for many stamps of the world picture various constellations. And stamp collecting brings us into close relationship with our neighbors, next door, in a distant city, or in a remote country. It provides us a common ground where we meet on equal basis people whom we should never know by any other means. It satisfies our urge to learn, to own, and to elevate ourselves to a higher plane of existence.

Stamp collecting does all of these things and, in the end, we can sell our treasures and salvage in return a considerable portion of the money we have expended. In our stamp collections we may leave to our loved ones the rich legacy of a satisfying life, with a substantial monetary value. We have eaten our cake and we can have it, too.

I know of no other avocation that offers these things in so rich a proportion.

Is stamp collecting an investment? The answer depends upon what you are looking for.

Are You Ready To Move Onto The Next Lesson? Click Here...