Banks & Investment Houses Getting Involved In Hobbies?

[darkchylde28 | 1,546]

So I was going through my Facebook feed this morning, and a friend posted this article.

On the face of it, it doesn't really have anything to do with video games, or much of what we discuss here.  However, in scanning through it, I noticed that the Bank of America analyst that's quoted throughout the article kept throwing out a far deeper knowledge of Magic: The Gathering as well as the big money cards that are no longer in print, as well as the recent and historical values of those cards.  Given that the product that he seems most concerned about is stuff that the company has promised never, ever to reprint in any usable form, and thus wouldn't directly affect the company's bottom line, it really made me stop and think:  Is Bank of America investing in big money, out of print Magic: The Gathering cards?

It might seem like a silly question, but given all of Hasbro's other brands, and their seeming mishandling of those in addition fo Magic: The Gathering, it seems a bit odd to me that a high placed analyst within Bank of America would have such a detailed and nuanced knowledge of specific cards as well as their values, especially given that those things are all tied to the secondary market and not something that Hasbro themselves can control.  So, what if that's the case?  What if one of the major US banks has been quietly, unofficially investing in the high end secondary market of a now nearly 30 year old collectible card game?  Would they be the only ones?  Would they restrict themselves to just the market for these cards?

There's no proof whatsoever as far as what my thought processes churned up (yet), but a lot of the sudden, insane rises at the highest ends of collecting in the various hobbies in the past few years would make a lot more sense if more than a rich dentist and the guy who founded Reddit were involved.  Anyone have any thoughts on this?

[RH | 4,895]

I'd highly doubt it.

I've worked for a very large major competitor of BoA and I worked as a developer for the Market Risk team, which did a lot of mandatory work after 2008 that the government setup to prevent banks from over-leveraging itself.

Banks engage in such complex trading it'd, make your head swim.  To make it even crazier, this is done by people who they simply higher to invest their money.  Now, you'd think that means that one guy in their army of investors might get a "crazy" idea to try and invest in something like this.  If the general, burgeoning collector market is seeing tremendous growth year over year, especially in the pandemic, this type of investment would seem to make sense for that one guy who might have a portfolio of about $2-5M that he's responsible for.  The problem is, though, that these types of investments usually involve having to keep physical inventory somewhere.  When it comes to the investors, that's just not something that the banks are interested in.

Granted, banks may own homes  or cars (or other items that you could take a loan on if someone defaults on payments) but managing defaulted assets is in an entirely different department.

I mean, I could definitely see some small potatoes investor in the company getting an idea to invest in collectibles, but realistically, it'd be to much of a hassle for the banks to take the initiative to catalog and setup warehouses to hold inventory properly in climate controlled areas for future sales of investments.

[TDIRunner | 2,727]

A quick Google search estimates the entire Magic the Gathering market at about $2 billion.  That's the entire market.  I don't see a large bank wasting time on something like that when you have to take into account the fact that it's a physical media that they have to track, catalog and store.  That doesn't mean there aren't bankers out there that just happen to know the market and maybe even participate in it themselves.  But big banks aren't going to get into this.  

[DefaultGen | 5,400]

I think the big important analyst man is spending time researching in detail the things that affect Hasbro, the big billion dollar company that produces continuing value and dividends year after year. Why squander your big smart investment research on the nuances of illiquid cardboard squares that sit in a box and don't produce value rather than finding the next great tech startup? I get there are some few big smart people who speculate in collectibles, but far and away it's a bunch of middle aged Timmies who like pop culture, and investment bankers want to be the first to ditch Meta and manage the next Facebook's IPO to get real money.

I think our expectations are low, because if you see an IGN article about Magic, the author likely has a passing interest and 20 minutes of Google understanding of the market. So it's jarring to see some detailed report made by suits in a tower who certainly don't truly care, yet nail down exactly why a card game they don't even play is floundering.

What do I know though, I'm just some IT guy.

Edited November 16, 2022 by DefaultGen

[360collector | 289]

2 hours ago, TDIRunner said:

A quick Google search estimates the entire Magic the Gathering market at about $2 billion.  That's the entire market.  I don't see a large bank wasting time on something like that when you have to take into account the fact that it's a physical media that they have to track, catalog and store.  That doesn't mean there aren't bankers out there that just happen to know the market and maybe even participate in it themselves.  But big banks aren't going to get into this.  

Thats where I come in, offering banks to buy stocks in my games without any of those issues, easy moeny for everyone, its all going to the moon they wont even notice my 1500 a week management fee

 

[saiyok | 20]

On 11/17/2022 at 7:17 AM, DefaultGen said:

I think the big important analyst man is spending time researching in detail the things that affect Hasbro, the big billion dollar company that produces continuing value and dividends year after year. Why squander your big smart investment research on the nuances of illiquid cardboard squares that sit in a box and don't produce value rather than finding the next great tech startup? I get there are some few big smart people who speculate in collectibles, but far and away it's a bunch of middle aged Timmies who like pop culture, and investment bankers want to be the first to ditch Meta and manage the next Facebook's IPO to get real money.

I think our expectations are low, because if you see an IGN article about Magic, the author likely has a passing interest and 20 minutes of Google understanding of the market. So it's jarring to see some detailed report made by suits in a tower who certainly don't truly care, yet nail down exactly why a card game they don't even play is floundering.

What do I know though, I'm just some IT guy.

 

[inasuma | 1,203]

once the 30th anniversary product releases, i firmly believe its success will spell the beginning of the end for mtg as we know it. the slew of new products is one thing, but actively choosing to cash in on the secondary market value of its own products is a level of scum and villainy you can't come back from.

hopefully 30th crashes in a blaze of fire though.

[darkchylde28 | 1,546]

1 hour ago, inasuma said:

hopefully 30th crashes in a blaze of fire though.

Pretty certain that's guaranteed because, seriously, what actual players of the game could actually afford to buy it?  It's $1000 a box for four 15-card packs, so 60 cards total, that aren't even playable.  A big part of the outrage about this is the fact that Wizards pulled this crap instead of doing literally anything for the actual players who buy the vast majority of their product versus the rich investor jerks who really only play with the secondary market.  I know that if I still had any interest in the game I'd be incensed over this crap.