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Sunday, June 01, 2008

Card Collecting and Investing: The Baseball Card Society

I loved baseball cards growing up. I started collecting them at the age of 11 just as the baseball cards themselves started to boom back in 1986. In fact, I think I spent just about all the allowance I had the next several years in buying boxes of cards from the local Costco. It was at the start of the really massive production of Baseball Cards and I looked at it two ways – one, I collected my favorite players and two, I also “invested” in the players who I thought would be popular either to resell or trade. In fact, I still occasionally tinker with them today.

To this day, I still remember sitting in my parents’ car opening a box of cards while my dad was in Home Depot and finding the “pull” of my young life. I can see myself opening up that wax pack and seeing a card with an entirely different border. The card, 1991 Donruss Elite Rickey Henderson – limited to 10,000 – the first of its kind from a major manufacturer. It was worth $200 at time, and Rickey Henderson was one of my favorite players which made it a little more special. I bought a 1” Lucite protector for that Baseball Card and sold it for a handsome profit a few months later.

1991 Donruss Elite Card of Rickey Henderson
Well, this past weekend we were visiting my new nephew up in Bakersfield and staying at my parents’ house. While not the house I grew up in, the room we stay in has some of the books and things that I had growing up. One of them in particular caught my eye – “How to Invest in Baseball Cards” by Stanley Apfelbaum – produced by what was known as “The Baseball Card Society.” I could not resist, I had to read the short guide on investing – only about 50 pages.

Logo from the Baseball Card Society, founded by Stanley Apfelbaum of First Coinvestors, Inc.
As a little bit of background, “The Baseball Card Society” was founded in 1988 by Stanley Apfelbaum as a way to send “valuable and rare” baseball cards to subscribers for a $30/month fee, of course plus shipping and handling. Apfelbaum was of former notoriety from the numismatic telemarketing fame – ran First Coinvestors, Inc. While Apfelbaum is no longer with us and First Coinvestors is not in business, today the company still has a reputation for boiler room tactics, altering coins, and frankly ripping of investors.

While you can find some information on First Coinvestors and similar telemarketing numismatic companies that shipped millions of dollars of “rare” and “valuable” coins for investment purposes, very little is out there on The Baseball Card Society that was located at One Old Country Road in Carle Place, New York. I can relate my brief two month experience with the company back in 1988, when I was 12 years old.

As mentioned above, I received an offer – somehow, cannot remember – perhaps from a mail order company that I purchased cards from for The Baseball Card Society, that would – among other things provide me with quality investment grade baseball cards for a monthly price of $30 plus shipping and handling. Being a very young and less cynical investor at the time, it sounded great.

Then the first month shipment came, and contained in it among some unopened wax packs, a few 10 card lots of rookies cards – of which, I can only remember 10 rookie cards of Eddie Williams of the Cleveland Indians from the 1988 Donruss set. I had purchased a few boxes of the 1988 Donruss cards – and at the time Eddie Williams was completely off the radar. Names like Gary Thurman, Al Leiter, Kevin Elster, Roberto Alomar, and Mark Grace were all the talk that year. I was immediately suspicious on whether I received a decent value for my $40 that month from the Baseball Card Society.

(On a side note, Eddie Williams ended up bouncing around the minors and majors until 1998 – batting just .252, and never played in 100 games in a season. He did have one great stint for 49 games in 1994 with the Padres, batting .331 with 11 home runs. I also met Eddie at Tony Gwynn’s San Diego School of Baseball and he was a great guy – in fact, I had him autograph a few of those cards. However, the cards as an investment were a complete bust never going about $.40.)

On a subsequent month, what was in the monthly package for $40? An unopened box of 1987 Topps baseball cards; arguably the most over-produced baseball card of all time(outside of 1991 Donruss and 1991 Upper Deck). I knew I could still purchase boxes of 1987 Topps for less than $20 from local card stores or out of the Beckett Baseball Card magazine. I immediately cancelled my subscription to the Baseball Card Society and forgot about many of the materials that came with my starter package.

Back to last night, I laughed as I looked at the cover of the “How to Invest in Baseball Cards – A Personal View” with a price of $25.00 in the upper right hand corned. It was scattered with baseball cards from that highly produced 1987 Topps run across the front cover. So I scanned and read the pamphlet cover to cover to see what I might find.

Of course I realize I have a huge benefit in seeing what happened to the Baseball Card hobby, from a collector’s only hobby – to a really money making industry enough to support 5 or more major manufacturers sans Major League Baseball’s license restrictions a couple of years ago. And it is an industry that has boomed and crashed going through several phases that included a huge focus on insert cards, game used merchandise, and autographs. In fact, you are hard pressed to find many cards produced in the 1980’s that retain anywhere close to their values then – given the gross overproduction, lack of true star players, and rampant counterfeits.

As I read through, I noticed that the book itself was not as much about investing in baseball cards as it was self promotion of The Baseball Card Society and their ability to find the best values for collectors. The continual use of that 1987 Topps brand and “current prices” and growth in those card values to emphasize their points was crazy. Furthermore the inference that you could make a fortune by investing in cards that were worth $.15 so you could sell them for $.45 was absolutely ludicrous, even if the 300% perceived gain was even attainable.

But as much as there was a lot of selling and ridiculous statements, in retrospect the book had some serious redeeming values that I found.

- The 3 elements of collecting for investing are there – Rarity, Popularity, and Quality. Collecting (investing) on these principles is a very good approach.
- Quality over value. This means that if you have limited money, you should by the highest quality card that you can. It is better to buy one particular card in the best condition you can find over buying several copies of that same card in much lower conditions.
- Several cards mentioned in this pamphlet (1952 Topps Mickey Mantle at $3,000 dollars, T-206 Honus Wagner at $15,000 in high conditions) have increased as much as 10,000% or more since that time. In fact, people would fall over for the opportunity to buy those cards for 10 times the prices being published in 1988 as these cards go in the hundreds of thousands of dollars in auctions today. We are talking Microsoft and Dell type investor returns. Crazy.

While there are a ton of detractors for the Baseball Card Society as well as Stanley Apfelbaum, the pamphlet that was distributed could have actually helped investors had you stayed away from those 1987 Topps examples. If only you had a time machine. :-)

It was a fun walk down memory lane, both from as an exercise in cynicism and reflection. The Baseball Card Society did not stick around for too long, and had I stayed with them it would have been wasted money for me. But, had I looked at some of the recommendations from “How to Invest in Baseball Cards” there may have been some good outcomes.

Maybe I will visit eBay and pick up a few of those nostalgic issues from the 1980’s for a few bucks for memories sake.

1 comments:

Mel Bashore said...

In the 1980s and 1990s I was one of the first to compile and sell football address lists for autograph collectors. Stanley Apfelbaum bought lists from me in 1989. I still have requests he made for those lists, signed on Baseball Card Society stationary. The letterhead states that Yogi Berra, Bob Gibson, Whitey Ford, and George Sisler were on its investment advisory board. Joseph A. Gallo was listed as the assistant director. In 1994, I received a note from Apfelbaum's widow, Ann, stating that her husband had died in 1990.