Hello, Federal Reserve launched another aggressive stimulus program today: printing unlimited US dollar every month. US dollar will become toilet paper until Fed stops its printing machine.
Do you think that price of magic card will rise in many years?
I think you might want to look into how quantitative easing works a little more but if you really want to bet on the USD diving in price you are better off buying gold than magic cards.
The ECB is about to embark on its own QE program and the Japonese central bank has been doing QE for about twenty years now. So the world-wide money supply is going to be inflated. When that happens, it all just evens itself out. Currency exchange rates will remain relatively stable. It won't be like it was last year when it was a $1.49 to the Euro and truckloads of our dual lands and power went across the pond to the old world.
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WoTC, thank you for finally announcing the Modern format, an eternal format where everyone can participate.
They have already done a ton of this with little effect since the banks ate hoarding reserves. It may be that inflation never happens from this since the money isn't circulating. Also you should realize that Magic is seemingly recession proof.
Buying up mortgage backed securities from banks is not helping the circulation of money because banks are not loaning and bussiness are not seeking loans. Basically the QE money is rotting in the bank's vaults gathering dust.
On the other hand if the $40 billion a month is given to the public via $120/month per person in consumption coupons then it would be a real stimulus as product and service outputs will be forced to increase to match the rise in consumption. This might actually improve the unemployment rate.
It will be great to have an extra $120 to spend on Magic cards every month.
Prices in Magic cards will always fluctuate throughout the years the only cards that were worth investing in was back in 1993... Now there are a few cards worth investing in but don't see super crazy value cards anytime soon.
Reason being cards back in the day were just being tested obviously, tricks were found, cards were waaay to good (Power 9 anyone) Just doesn't go like that anymore.
I buy Magic cards and I don't even play (not yet until I get my deck building skills up since well it's been 14 years since my last match) but I love a lot of the art work so that became my thing..
They have already done a ton of this with little effect since the banks ate hoarding reserves. It may be that inflation never happens from this since the money isn't circulating. Also you should realize that Magic is seemingly recession proof.
I would vouch for this. In fact, Magic might even be a counter-cyclical investment. This is just my personal theory, but in hard economic times, people want to play magic. They want something to take their minds off the negative economics.
They're also looking for places to park at least some of their money in the form of investments. Assuming players have confidence Wizards isn't going to reprint their cards into financial oblivion, they have incentive to invest MORE in magic in bad economic times.
The stock market isn't growing. Bank returns are minimal at the moment. If I had $1000 I would have originally kept in the bank, maybe now I keep 900, and put $100 into staples like dual lands.
On the other hand, suppose the economy is booming. The market is growing 15-20% a year. Am I going to put my money in magic, or the booming stock market? I'd probably put more money into the market and less into magic cards. The opportunity cost, or rather the gain I would have netted by putting money into the stock market is now an additional cost weighing against putting money in magic.
The most direct counter to my theory is the obvious. People have less free cash in hard economic times. I would agree with this; for those for whom magic is the very edge of their surplus cash, they would spend less.
But I don't think magic players fit the economic profile above. They're mostly single young men with disposable income wondering what to do with it, or they're married individuals who aren't living on the edge of the breadline. (they're people with disposable income)
Given the fact that magic is a fun social game has an opportunity to actually reap gains is just icing on the cake.
It's nice to see discussion like this, and good to see that a few people understand some of the concepts involved.
QE3 is huge, absolutely. 85 billion per month is enough to give EVERY human being who ever existed one US dollar, every month. Jesus, every caveman, your mom, babies that died in childbirth through the millenia, and so forth. Everybody could get a dollar every 30 days.
So it's a huge number for sure. But how much of it will really hit the street, and end up in general circulation? Not a lot.
That said, Magic cards ARE a hedge against inflation. They're tangible and they inflate to some degree with the money supply. However, they don't make a good money, because they have little intrinsic value. After all, they're just paper rectangles with ink printed on them. Wizards can "inflate" by printing more. We've seen it before when old cards get reprinted, and the value drops in half or even more overnight.
Long story short, if you're worried about protecting your stored value from inflationary forces, which are certainly looming large right now, park some of it in gold and silver bullion, and keep it in a locked box or other suitable hiding place within easy reach. If you don't hold it, you don't own it. Get out of stocks, get out of bank account balances, get out of paper.
But Magic is fun. Own some Magic cards too. Just don't count on that value always being there because it can be whisked away in an instant. A Black Lotus will always sac for three mana on turn 1, but it might not always be redeemable for a month's rent.
Quite honestly, I think the boat has somewhat sailed for mtg cards as an investment at this point. In addition, just speaking objectively on QE3, the effects of QE3 look to be somewhat muted compared to the previous two QE's, so YMYD...
This is just my personal theory, but in hard economic times, people want to play magic. They want something to take their minds off the negative economics.
Many people share this opinion. In fact, it is said that Monopoly gained popularity in the Great Depression because it was a way to stay in and keep your mind off difficult times. I would agree that Magic is an out for many people experiencing hard times right now.
It also scales to your economic situation; you can play a basic 'fun' deck of commons very, very cheaply, possibly free or close to it(some stores have 'free common' boxes with draft leftovers for new players to raid). Or you can bling the heck out of a rare-filled commander deck--and still theoretically lose to the previous 'fun' all-common deck. It's also repeatable, free entertainment once you've made your investment of time/money involved in learning the game/building a deck.
As an investment, it's still very high risk, due to large price/demand swings based on reprints/volatility. As with any investment, if you can't explain to yourself, in detail, how you could lose money: you shouldn't make that investment.
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Do you think that price of magic card will rise in many years?
If yes. do you buy all cards as an "investment"?
On the other hand if the $40 billion a month is given to the public via $120/month per person in consumption coupons then it would be a real stimulus as product and service outputs will be forced to increase to match the rise in consumption. This might actually improve the unemployment rate.
It will be great to have an extra $120 to spend on Magic cards every month.
Reason being cards back in the day were just being tested obviously, tricks were found, cards were waaay to good (Power 9 anyone) Just doesn't go like that anymore.
I buy Magic cards and I don't even play (not yet until I get my deck building skills up since well it's been 14 years since my last match) but I love a lot of the art work so that became my thing..
I would vouch for this. In fact, Magic might even be a counter-cyclical investment. This is just my personal theory, but in hard economic times, people want to play magic. They want something to take their minds off the negative economics.
They're also looking for places to park at least some of their money in the form of investments. Assuming players have confidence Wizards isn't going to reprint their cards into financial oblivion, they have incentive to invest MORE in magic in bad economic times.
The stock market isn't growing. Bank returns are minimal at the moment. If I had $1000 I would have originally kept in the bank, maybe now I keep 900, and put $100 into staples like dual lands.
On the other hand, suppose the economy is booming. The market is growing 15-20% a year. Am I going to put my money in magic, or the booming stock market? I'd probably put more money into the market and less into magic cards. The opportunity cost, or rather the gain I would have netted by putting money into the stock market is now an additional cost weighing against putting money in magic.
The most direct counter to my theory is the obvious. People have less free cash in hard economic times. I would agree with this; for those for whom magic is the very edge of their surplus cash, they would spend less.
But I don't think magic players fit the economic profile above. They're mostly single young men with disposable income wondering what to do with it, or they're married individuals who aren't living on the edge of the breadline. (they're people with disposable income)
Given the fact that magic is a fun social game has an opportunity to actually reap gains is just icing on the cake.
QE3 is huge, absolutely. 85 billion per month is enough to give EVERY human being who ever existed one US dollar, every month. Jesus, every caveman, your mom, babies that died in childbirth through the millenia, and so forth. Everybody could get a dollar every 30 days.
So it's a huge number for sure. But how much of it will really hit the street, and end up in general circulation? Not a lot.
That said, Magic cards ARE a hedge against inflation. They're tangible and they inflate to some degree with the money supply. However, they don't make a good money, because they have little intrinsic value. After all, they're just paper rectangles with ink printed on them. Wizards can "inflate" by printing more. We've seen it before when old cards get reprinted, and the value drops in half or even more overnight.
Long story short, if you're worried about protecting your stored value from inflationary forces, which are certainly looming large right now, park some of it in gold and silver bullion, and keep it in a locked box or other suitable hiding place within easy reach. If you don't hold it, you don't own it. Get out of stocks, get out of bank account balances, get out of paper.
But Magic is fun. Own some Magic cards too. Just don't count on that value always being there because it can be whisked away in an instant. A Black Lotus will always sac for three mana on turn 1, but it might not always be redeemable for a month's rent.
Your mileage may vary, do your own research, etc.
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Many people share this opinion. In fact, it is said that Monopoly gained popularity in the Great Depression because it was a way to stay in and keep your mind off difficult times. I would agree that Magic is an out for many people experiencing hard times right now.
As an investment, it's still very high risk, due to large price/demand swings based on reprints/volatility. As with any investment, if you can't explain to yourself, in detail, how you could lose money: you shouldn't make that investment.