The Grading Death Spiral Has Begun

NotSportsCards · 10-17-2022, 03:11 PM

Ive been contemplating this concept for a long time. And I had hope it does not turn out to be true, but it is more and more likely each day.

Pandemic Made Grading Scarce which fueled the boom

Macroeconomics change causing market slow down
Grading companies increased capacity
Market is getting flooded with graded cards as demand decreases
Flippers disappearing means that collectors need to absorb more of the inventory fresh form grading
The amount of inventory keeps growing but the amount collectors can absorb is shrinking

Collectors $ are shrinking because of macroeconomic changes

Inflation
Equity markets
Real estate

Hybrid Collector/Flippers are shrinking the most as they used to use money made from cards to buy new ones.

Now they are losing money and stuck with cards that they would have to fire sale
This makes cards that are borderline worth grading nosedive in value. Example are PSA 9s for modern era.
Remember what is ultra modern soon shifts into modern and then vintage.

Grading price decreases

Cards have an inherent value relative to the cost of grading and amount of time required to performs task
The grading companies need to continue to lower cost to encourage people to continue to submit.
If people arent creating a profit from grading this means more money is being pulled out of the hobby into the pockets of grading companies.

The whole process repeats.

I see no way of avoiding this. For the most part we are seeing a lot of this happen already, but the speed of the fire sales will increase. What started as "base is over saturated" will extend to every part of the hobby.

I love my cards and the collector in me wont sell. The businessman in me thinks selling all graded cards I can live without is the best move.

Welcome other points of view.

10-17-2022, 03:11 PM	#1
NotSportsCards Member Join Date: Oct 2022 Posts: 65 fishcakeking	The Grading Death Spiral Has Begun Ive been contemplating this concept for a long time. And I had hope it does not turn out to be true, but it is more and more likely each day. Pandemic Made Grading Scarce which fueled the boom Macroeconomics change causing market slow down Grading companies increased capacity Market is getting flooded with graded cards as demand decreases Flippers disappearing means that collectors need to absorb more of the inventory fresh form grading The amount of inventory keeps growing but the amount collectors can absorb is shrinking Collectors $ are shrinking because of macroeconomic changes Inflation Equity markets Real estate Hybrid Collector/Flippers are shrinking the most as they used to use money made from cards to buy new ones. Now they are losing money and stuck with cards that they would have to fire sale This makes cards that are borderline worth grading nosedive in value. Example are PSA 9s for modern era. Remember what is ultra modern soon shifts into modern and then vintage. Grading price decreases Cards have an inherent value relative to the cost of grading and amount of time required to performs task The grading companies need to continue to lower cost to encourage people to continue to submit. If people arent creating a profit from grading this means more money is being pulled out of the hobby into the pockets of grading companies. The whole process repeats. I see no way of avoiding this. For the most part we are seeing a lot of this happen already, but the speed of the fire sales will increase. What started as "base is over saturated" will extend to every part of the hobby. I love my cards and the collector in me wont sell. The businessman in me thinks selling all graded cards I can live without is the best move. Welcome other points of view.