Crocodilian

The Contemporary Art Bubble and Money Managers

Collectibles are not an "investment". Their value is determined solely by their scarcity, and future tastes; they have no economic value (even if someone will pay a lot for them). It is commonly forgotten that collecting categories go in and out of fashion, and once out of fashion, many never see their highs again. Two notable examples:

1) signers of the Declaration of Independence. This was a major collecting category of the early 20th century, with super-premium prices paid for the rarest signer, the otherwise obscure "Button Gwinnett". Prices are today, in real dollars, less than they were fifty years ago. There were other, now forgotten collecting categories for completists which are now essentially worthless (Anglican churchmen of the world)
2) books and manuscripts generally, John Galsworthy in particular. The celebrated peak of the rare book market was the sale of the Jerome Kern collection in early 1929-- in real dollars, and in some cases in nominal dollars, seeing prices never equaled since. John Galsworthy manuscripts were particularly richly priced at the time.

All this brings to mind the problem with evaluating the performance of art & colllectibles markets, the selection effect. People look at what's valuable today, and then look back to see how cheap it was some time ago, and then mistake that gain for a return, without considering all the other things people once thought of as valuable, and now won't pay anything for.