what's going on everybody welcome back to stacking slabs your hobby content alternative it is flagship time that time of the week excited to explore a topic with you that is on my mind especially on my mind as you know we're on the heels of a nearly sixteen point five million dollars sale in this space and there is a lot of conversations and a lot of fallout and a lot of well what does this mean for me and so while the psa ten pikachu illustrator sale is unprecedented and is certainly something that'll be talked about for a very long time what i wanted to do was consider from a collector perspective how we absorb these sorts of sales and the mantle sale of the pikachu is an easy one to point to but there are so many other sales in our space in the spaces we collect in that cause us to think and cause us to react and so what i wanted to do in this episode is talk about the hobby not being just one market but it is mini micro markets and dig into that topic because as i am exploring my observations of what's happening right now during this time i document and i write and i stash stuff away and what i'm beginning to realize throughout this whole process of building stacking slabs is it is becoming an archive for what is happening in the hobby and obviously i don't think i could do a flagship episode a week or so removed from this without commenting not about the card but about the environment that we're currently buying selling trading in before we get into that a couple things number one make sure you hit the follow button tell a damn friend and check out the patreon if you're interested in more content i know we are putting out a lot on the main feed almost every day there's a new piece of content that won't stop there's more in the patreon i'd also ask you to follow the link in the show notes and subscribe to the weekly rip it's a newsletter it's a companion piece to the flagship it goes out every sunday just head on over to the link it would be great if you could just sign up i am trying to grow that i never really promote it but i enjoy putting it together each and every week and the flagship wouldn't be possible without my good friends at inferno red technology they are the sponsor and they're the engineering team behind some of the biggest names in sports and collectibles like dc sports eighty seven commsi collectors upper deck and ebay from ai powered solutions to startups to full stack platforms for industry leaders their team can tackle your toughest technology challenge they built awesome software for the hobby four leagues and fans and everyone in between see what they can build for you at inferno red dot com we talk about the hobby as one market it's not it's dozens of segments that are operating simultaneously there is market structure there is collector psychology that goes on here there's segmentation and so in this episode i want to outline things that i am seeing and points of clarification that i am thinking about i think this sale doesn't change fundamentals in every segment but it changes imagination across all segments and it depends on what segment you're in and before reacting to a headline sale i think every collector should ask what segment am i actually in when i zoom out and look across the hobby landscape and look about what's happening across all of these categories there are three things that i'm observing that regardless of what you collect are happening number one there is more infrastructure than ever before there are more platforms and systems in place to serve the transaction and that's undeniable in order for any industry or any hobby or any market to grow there needs to be the right infrastructure there needs to be the right platforms in place to make it easy on us to transact another observation is which is great is transparency there is more transparency on the sales side than ever before i think about tools like cardladder i think about cardladder's ability to give us data and information that we need in order to make decisions and i made bought a card last week and was in a negotiation and ended up landing it at about the price i wanted to because i was able to use data in cardladder and that's good so you got infrastructure you got transparency and then you also have more intent driven collecting i think when i think about the pandemic boom i think about just people just buying shit just to buy stuff to try to flip it because everything was going up and while the market is ripping in this moment and in this era what i am seeing and part of the viewpoint is observing all day every day having conversations all day every day i'm i'm observing a trend in more intent driven collecting people buying cards because they want them in their collection let's look at the illustrator sale and i haven't really heard anyone talk about it that's why i wanted to emphasize this and it'll help maybe validate some of what i just referenced we think about infrastructure i think about that card think about the infrastructure that was in place behind that card we all saw a unique opportunity or saw a unique sale and it is something that will be a case study and likely repeatable this card was introduced to many of us that it was going for sale through a netflix show king of collectibles the golden touch if you watched season three you saw the negotiation between ken and logan and you knew that this card was going to be available that's not normal that's marketing and there's infrastructure in place but that's not normal then there was a promotional tour of this through collectible outlets through mainstream media outlets logan paul being the megaphone that he is there's just a lot going on with the promotion you pair that with golden and everybody and their mama knows about this card then there's the event there's the sale there's the countdown there's everything and and it's in golden hq and you see the owner the new owner who is in the building aj scaramucci you you you see it all happen so you got this entire life cycle from we know logan has this card to this card is going to be put up for auction it's being promoted then you actually see the buyer at the end of it there is some transparency there that we don't normally see and we get the intention behind the new owner and why he wants this card that like thinking about that sale and the way it went down i find interesting and i'm i'm curious and obviously this is not something i can just go do if i sell a card right i don't have cards of that status nor am i a celebrity like logan paul but i am curious to see if this continues to trend i think these kind of headlines these big sale headlines are gasoline for a single very human error and we start treating the hobby like a single market with one mood i think behavioral research shows that vivid recent emotionally sticky information becomes outweighed in our judgment and the prominent numbers can become reference points that shape evaluation and just as importantly macro headlines are not neutral facts they're narratives economic research on narrative economics argues that viral stories can function like shocks to the system spreading through the social transmission and influencing decision making behind beyond what fundamentals alone would predict i think a second reason headlines distort perception is record prices are often discovered in thin markets few transactions few true substitutes and huge buyer dispersion in thinly traded assets liquidity has real value and interacts with volatility and price moves can be jumpy rather than smooth so when i'm thinking about this the framework that i think about is two axis segmentation that makes the hobby make sense for me it forces me and hopefully collectors to stop arguing about the market and start asking which market exactly and the simplest way is to make it operational and to treat the hobby as a portfolio of micro markets defined by two interacting axes you've got the financial tier or how much capital is naturally deployed per transaction and how concentrated that buyer pool is and you have the persona type what psychological reward the buyer is actually purchasing profit identity belonging completion this isn't wordplay the infrastructure of the hobby increasingly reflects micro markets you look in cardladder you can see that it publishes multiple indices and describes these indices as tracking the performance of any given set of cards across categories and groupings i'm very interested that i got to this point in my mind thinking about the hobby thinking about the c think then looking at platforms like cardladder and seeing them tracking different categories and i'm just surprised this isn't talked about enough i think even the supply data collectors use the supply data that collectors use is segmented psa's pop report is organized as searchable database across categories and sets and institutionalized way of thinking and lanes what exists in what grade in what category i think the punchline is if the tools serious participants use are segmented the market is segmented whether the conversation is or not maybe is another question okay so the first axis financial tiers that change the market's physics i think this tier and thinking about it this way works because each tier has different physics liquidity information flow buyer count and what a headline actually does liquidity and comps get worse at the top i think ultra markets are thin the value of they value immediacy liquidity can be large a price signals can be noisy because there are so few trades auctions become a primary mechanism of price discovery at the top end and research on art auctions for instance emphasize how auction system shape price formation and how those markets function think useful analogs become the trophy collectibles share the same features uniqueness scarce transactions and high narrative count got middle tiers are thicker more participants more repeatable transaction more substitutes that tends to produce steadier pricing even at the top if even if the top end is swinging lower tiers are attention sensitive what category spikes is visibility new entrants often begin at an accessible price point and that can change demand and entry lanes without changing ultra elite demand at all this isn't guaranteed but it matches what narrative driven demand shocks predict stories spread broadly and behavior changes where friction is lowest a headline sale doesn't trickle evenly it radiates differently depending on where you sit on your own financial in your own financial situation access to its personas explained behavior better than price charts persona segmentation is where you can generally genuinely calm people down because it reframes why people are buying as plural not singular you can dig in and apply your own assumptions or research but it consistently points to multiple motivations behind collecting including identity meaning status control structure investment motives you've got an investor first mindset can i exit later and what is the spread investors in that word has become more prevalent as the hobby continues to expand you've got collector first people who want these cards gen genuinely for their collection and the pride of ownership you've got flippers individuals out there hustling trying to make margins on cards and moving them quick you've got nostalgia driven collecting where there's emotional and social connectedness to it you've got status seekers people who are just looking to buy cards to show how great they are or how cool they are or be a part of a club you've got completionists like my conversation with mike last week in on his glen rice collection you've got people who chase scarcity people who just want cards that are hard to get i think most collectors are a blend personas describe the dominant driver in the moment not someone's entire identity when i think about this sale this illustrator sale my my question is like what does this actually do to the hobby i think you can treat a trophy sales information shock plus a narrative shock whether it changes prices in your lane depends on not just the vibes the main transmission channels are well studied narrative spread these stories can propagate socially and shift attention and behavior you got social proof in cascades when people are uncertain they often look to others you've got anchoring a big number becomes a reference point you've got scarcity interpretation extreme rarity can increase perceived value now using the pikachu illustrator sale as the example you can look at this from the financial tier perspective obviously ultra elite grail tier this verified sale becomes a public anchor for a trophy pricing and status maker that encourage encourages museum logic this is consistent with collecting as status signaling trophy consumption there is different persona effects and ramifications but we'll get to that you've got what does this mean for high end benchmark pressures people in this tier start reunderwriting what qualifies as a blue chip inside adjacent categories mid tier the psychology spills over entry level collector it's attention the attention spikes more people might come in because of this the persona side you know looks for institutional or the investor first side looks for institutional signals and liquidity pathways and they interpret the sale as evidence of market depth at the top but they won't necessarily buy what you buy they'll buy where they can exit collectors might translate this grail concept into their own lane using identity logic there's a lot of different ways to look at this i'm not here to suggest that you must look at it the way that i'm looking at it where i'm looking at it from the perspective of segmentation based on financial sit situation and segmentation based on persona type you don't need to do that that's how i'm looking at it but when i do it that way it begins to break down this hobby this c it breaks down into simpler more digestible mini mark micro markets that help me better understand what is actually happening and in those spaces there are analysts there that are collectors people who are living and breathing and maybe even business owners who buy sell and trade exclusively in those space and they they sell exclusively to a specific type of person when you just simplify and just be very general about the hobby and you know we're all in the hobby like i think we're all doing ourselves a disservice know what does this sale mean it likely means in this moment a lot more people know or have interest in the hobby than ever before the sale was everywhere and that's good it's good to grab attention it's good to use big sales like this to drive interest but i don't think we should get it twisted we shouldn't think that our cards are worth a whole bunch more now because of the sale or this greatly impacts who we are and what we do as collectors i do think it is an opportunity in this moment to consider the intention of people in this space and break it down into specific categories because not all categories operate the same way and the more we understand the lane we're in who we're buying from their motivations desires and where they fall on our own system or our own structure that we will build the better chance we'll be able to get the cards we want at the price we want or at least we'll come at it and give it the best effort possible i look at this hobby in a lot of different ways and it changes i don't know what i don't know but i do know what i spend a lot of time digging in and researching and i think in general the way this hobby is presented could grow up a little bit i think we can start communicating and talking about not just the market but the markets the more we deliver real information that has data backing it and has great narrative the more excited collectors will get and the more educated collectors will feel and the more this hobby will start performing at a level not just like it's performing now in this moment but perform like this for a very long time understanding where we're at understanding where we're going and understanding our spot as a collector in this space is something that i think we should be more serious about hopefully you enjoyed this episode my mindset and mentality when it comes to this space i think it's great but i do think it's not just one market it's many micro markets and the more we can understand that the better off we'll be appreciate you supporting stacking slabs your hobby content alternative you all take care we'll talk to you soon