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Fall 2009 Newsletter
It’s all about perspective. Is the glass half empty or is it half full? Do we see through the prism of hope or that of fear? Many pundits quoting economists from the ‘monetarist school of thought’ would have us believe that we are on the verge of hyper-inflation because of all the liquidity that the Federal Reserve has pumped into the system to prevent a melt-down. According to this view the coming inflation would cause the value of the dollar to fall and the price of oil to skyrocket. And the end of the world as we know it would follow shortly thereafter. Those from the Keynesian school of thought, on the other hand, suggest that with all the excess capacity in the economy and lack of aggregate demand from consumer spending, business investment, and now from cutbacks in government spending (especially on the state and local levels), that the greater fear is from deflation, not inflation. As it turns out the Consumer Price Index has fallen 2.4% over the last 12 months. So the sky isn’t falling, and many signs indicate we have hit bottom, although the future growth curve may look more like a ‘U’ than the more familiar ‘V’. One should note too that the Federal Reserve has the capacity to withdraw that excess liquidity when the economy is on a firmer growth path, thereby short circuiting the possibility of hyper-inflation. As painful as this correction is, it is good that people are saving more and paying down debt. They are working harder and learning lessons in economics and how to better manage their personal finances. Seeing through the eyes of fear rather than hope, though, will only prolong the recession unnecessarily. The stamp industry is learning to cope with new realities also. Stamp dealers are finding ways to cut extraneous expenses wherever they can find them. Auction houses are merging, leaving fewer of them to work with. Stamp prices on average have decreased slightly, in some areas more than others. Some areas of the graded stamp market have dropped significantly. The more modern the stamp, the greater the fall. This was to be expected because there was an inflationary bubble surrounding this category of stamp. And just as the housing bubble and the tech stock bubble had to burst, so too did the graded stamp bubble. For example, at the height of the bubble, stamps that catalogued $1.00 or $2.00 sometimes sold for $2,000 to $2,400 in grade 100 condition (Gem). In other words some were selling for 1500 to 2000 times catalogue. These price declines in the graded stamps arena are just a predictable realignment to more realistic price levels. It had to happen. Interestingly, prices on the very expensive stamp rarities have held up quite well. Contrast this with rare paintings which have seen a dramatic drop in prices in recent months. I am not saying there was a collapse in the price structure of graded stamps. I am saying there was a migration downward to more sane levels. At the recent APS stamp show auction in August one of the largest holdings of graded stamps ever formed was auctioned off. Some experts feared that such a large quantity of graded stamps coming onto the market all at one time would ‘swamp the boat’. Well that just didn’t happen. All those stamps were assimilated into the market place at realistic but somewhat lower prices than they might have realized a year ago. Even a fairly modern stamp such as a C19 in grade 95 (XF-Sup NH) condition though, sold for more than $500.00 against a Scott catalogue value of $4.00. So there was no collapse, and the good news was that sanity prevailed, and that some prevalent fears were unfounded. Rarely do the things that men fear actually come to pass. That is not to say that bad things never happen, but rather, that our track record in correctly predicting them is not that good. Here are a few thoughts on the concept of hope. Hope is not just wishful thinking. Hope is not the conviction that something will turn out well, i.e., optimism. Rather, like Vaclav Havel, the poet, said: “Hope is a state of mind. It is a dimension of the soul. It is an orientation of the spirit and the heart. It transcends the world that is immediately experienced, and is anchored somewhere beyond its horizons. It is an ability to work for something because it is good, not just because it stands a chance to succeed. It is the certainty that something makes sense, regardless of how it turns out. It gives us the strength to live and continually to try new things, even in conditions that sometimes seem without hope.” Martin Luther King said, “We must accept finite disappointment, but we must never lose infinite hope.” And finally, Lionel Tiger said, “Cathedrals are an unassailable witness to human passion. Using what demented calculation could an animal build such places? I think we know. An animal with a gorgeous genius for hope.” For more on this topic, follow this link: http://www.postersfromtheheart.com/essay_pages/hope.htm Coming back out of the clouds and venturing among the more mundane realities, we at Croton Stamp Company have seen this market correction as a good opportunity to acquire new inventory and replace depleted stock. We endeavor to buy at low points in a market so we will have stock to sell when the market moves up. Buy low, sell high is what every retailer hopes to accomplish. Fear can short circuit that good advice. Hope enables it. Smart buyers recognize opportunity and take advantage of it. We are attaching to this email one page of stamp specials for your enjoyment and inspection. If you see something you want, just email us to place a hold on the stamp for you and to confirm its availability. We accept personal checks and major credit cards. Feel free at any time to email us (croton@warwick.net) your current stamp wantlist. Customers in good standing can have us send them stamps on approval. A Wantlist Form is attached for your convenience. Or call us in the evening (845-294-7361) to discuss any philatelic projects that you are working on. Maybe we can help. All the best, Tom Vaillancourt Announcements 1. We now accept credit cards from Visa, Mastercard, Discover Card, and American Express. This will be especially helpful to our customers living outside the US. 2. We will be listing one-of-a-kind stamp specials, on a regular basis, at our stamp web site, www.crotonstamp.com. 3. We have a few limited edition Millennium Collection (#1818v-34i) hard-cover books containing stamp designs with slight differences from those in the souvenir sheets. Brookman lists this item at $79.50. We are selling them at $49.00 each plus $15.00 for Priority Mail shipping while supply lasts.
Croton Stamp Co., P.O. Box 242, Goshen, NY 10924Send mail to croton@warwick.net with questions
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