While there is no way of knowing exactly how much damage COVID-19 has caused the global economy, several economists agree that businesses all over the world have experienced severe negative impacts.
Early estimates suggested that if the virus became a pandemic, most major economies all over the world would lose a minimum of 2.4% of their GDP in 2020. To put these numbers into perspective, the global GDP for 2019 was estimated to be approximately 86.6 trillion US dollars. Therefore, a 0.4% drop would mean losing 3.5 trillion US dollars in 2020’s output.
Since most of these predictions were made before implementing widespread restrictions to stop the spread of the virus, global economic realities might be a lot worse. For instance, Dow Jones reported the largest ever drop in global stock markets in a single day. On March 16th, 2020, global stocks dropped by 3000 points, breaking their previous record of 2300 points that was set just four days earlier.
Image Text:Global economy from 2019-2021
Alt Caption: Forecasted global economy from 2019-2021
Largely Driven by a Fall in Demand
The economic damages faced by the world during the COVID-19 pandemic can be largely blamed on fall in demands. This means that there aren’t enough consumers to buy the goods and services made available by the global economy.
This dynamic is clearly visible in industries such as travel and tourism. Many countries placed restrictions on travel in order to slow down the spread of the virus. In other words, people could not purchase flights for business trips or holidays.
As a result, the reduced demand of airlines caused them to lose their planned revenues and therefore cut down their expenses by decreasing the number of flights available. Without their government’s assistance, these flights might even have to lay off staff to cut costs further.
Good News for the Digital Economy
Despite the obvious slump the global economy is caught up in, there are quite a few reasons to be hopeful. For example, as the retail industry has no choice but to drop their shutters, their crisis will be cascaded over to the online retail segment.
- The year-over-year growth of revenue reported by online retailers in the US is up by 68%. These figures have surpassed the earlier peak of 49%, noticed in January 2020.
- Year-over-year growth of US and Canadian e-commerce orders was reported at 129% while the growth of all online retail orders stood at an impressive 146%.
- Online conversion rates had increased by 8% during February. These rates of shopping urgency were typically seen during Cyber Mondays or similar online promotions.
Image Text:Bowman baseball cards
Alt Caption: Bowman baseball cards from 1954
According to a 2020 study on remote payments, a whopping 72% of consumers have now shifted to shopping on online stores via mobile devices. Now, online retailers and e-commerce supply chains are experiencing revenue growth via triple digit orders. What’s even better, more effort is being put into making online customer experience much better.
The Sport Memorabilia Market Is Skyrocketing
Mike Trout, the L.A. Angels’ outfielder, is just 28 years old and still plans on playing professional baseball after his 9 seasons. However, in late May, Trout’s autographed rookie card had sold for $922,500 at an auction. This price tag has set a new record for trading cards of modern-day sportsmen. Anything game used from Trout is also desirable. Now is the time to ask that expert and make a decision if selling is for you.
There have been many whopping sales including a rare ‘Jumbo’ Honus Wagner card for a whopping $3.12 million in 2016. However, this year’s auctions are witnessing increased price spikes. It’s a good time to sell. Yes, it is. But it is also a good time to buy. Where collectors may have held on to their precious gems, the pandemic has swayed them enough to let go a few of these collectibles.
In Las Vegas, Kieta, Founder of Memorabilia.Expert experiences both Buyers and Sellers anxiousness. She goes on to say, “It’s an unprecedented time in the World. So, this is why you are seeing some astronomical prices for memorabilia now. People need to put their money somewhere, and that somewhere is in Cards, Gold Coins, Autographs and Game Used Jerseys. We saw this type of shift in 2008-2009. Our Consignments and Our Prices Realized have doubled . We have had a higher bidder participation. All of this, mind you, occurred while COVID-19 ambushed the US economy.”
The documentary with Michael Jordan, shot his market share through the roof, with a $150,000 sale of two cards with Micheal Jordan’s autographs, a $99,630 sale of Micheal Jordan’s rookie card and a $113,160 sale of Kobe Bryant’s rookie card.
Kieta, Memorabilia.Expert, goes on to say, “If you have any of these cards, now is the time. Don’t let this market slip away. Our Experts are reviewing cards daily. We have been reviewing collections 24 hours a day, but we are in Las Vegas!”
Why the Market for Sports Collectibles Is Booming
According to Kieta, the market for sports collectibles has increased exponentially since lockdown began. This can be largely contributed to the fact that quite a few wealthy people now have nothing to spend their money on. Most of these people may have pulled out their money from stock markets and want to invest in tangible assets instead.
The market for sports memorabilia has had an upward trajectory for a number of years now. In 2015, the modern card market was already worth 6 figures. However, in the past couple of months, the sales have been unbelievable – especially during the last 3 months.
Naturally, there is a big disconnect between the traditional image of children trading cards as a hobby and rich adults paying $900,000 for one baseball card. However, the former is already not possible during social distancing. It is also safe to say that the baseball industry had already shifted onto the internet before lockdown. Live card pack openings were already racking up thousands of views on Facebook and YouTube.
Nowadays, the cases of card packs are usually bought by secondary-market organizations (from companies like Topps) so they can sell spots in their breaks. This transaction cannot be completed without collectors, who pay for these spots and then watch live while auctioneers display their cards in a section of the break.
According to Michael Leiner, the VP of Topps, card collectibles have now replaced traditional children’s games with the e-sport of the trading card industry. While this trend already existed, the quarantine has rekindled the fire and companies like Topps are benefiting.
Leiner said that the last 5 years had been great for the company but right now they have been seeing unprecedented demand. According to the VP of Topps, the last couple of months have been all about growth while collectors were forced into lockdown mode and were probably feeling nostalgic.
“A lot of folks are at home sifting through their old baseball cards… and going out and purchasing more.” – Michael Leiner
Chris Ivy, Heritage Auctions’ Director of Sports Auctions, had similar remarks. He said that the increased interest in sports collectibles has a lot to do with people being stuck at home and digging into their memorabilia and perhaps even playing with them. In other cases, some folks also see their collectibles as a tangible form of investment or a hard asset.
Kieta, is currently romancing the idea of re-auctioning the Shoeless Joe Jackson card from 1910 which went for $492,000 and a rare Bowman Christian Yelich card from 2010 for $111,000. Both of these price points can be described as jaw-dropping figures – even during the COVID-19 pandemic. Having said this Kieta, believes that putting them up again in her September auction, that they will fetch an even higher price.
Bonus: Pokemon Cards Auction Out for $107,010
It wasn’t just sports memorabilia that resulted in ground-breaking sales because but an immaculate set of Pokemon cards sold for $107,010. Bet you wish you still had your set of first-edition of Pokemon cards.
Kieta, notes that “This set was immaculate, that’s why it fetched over $100,000. There is even a measuring standard for the condition of trading cards, known as GEM mint condition grading. This metric measures the gloss and the color consistency of cards. So don’t be discouraged. Just contact an expert. There is value in the original sets even if it is not in perfect condition.”
Additionally, Kieta also admitted that oftentimes, millennials’ parents will call her to evaluate their baseball card sets that date back 50 years. After telling them that they would sell for $15,000, they would often have follow up questions about their children’s Pokemon cards. Some would even be surprised to find out that these cards are worth twice as much as vintage baseball cards.
Even TMZ shed some light on this record-breaking sale of 103 Pokemon cards, which also included a holographic Charizard. It is safe to say that since 2016, Pokemon cards have increased in value by almost 10 times. On a completely unrelated note, some millennials out there might believe that they are broke but might have 6 figures lying around in the mess of their closet or attic.