General Commentary: The Bull in the China Shop

Recently, a prominent Chinese dealer published an extensive buy list for stamps of the P.R.C., with buy prices which significantly increased the wholesale values of key P.R.C. stamps. The most dramatic increases seem to be for many of the better souvenir sheets and for issues of the Cultural Revolution. The question is: does this represent a pivotal event for the P.R.C. market, and perhaps for the global stamp market as a whole, comparable in its implications for the stamp market to the effect of the failure of Lehman Brothers on the stock market (except, of course, that the new buy prices represent a positive development rather than a negative one)?

It's quite possible that the buy list was simply an attempt to manipulate prices upward, so as to increase the value of a dealer's inventory. But does this even matter? The Chinese stamp market has been hot for a while now, and it would be surprising if price manipulation was not utilized as a catalyst every now and then.

It's also possible that the new buy list is evidence of a bubble.

"The Entire Nation is Red" Design Error (Scott #999A)

To attempt to get a better idea of what is going on in the market for better P.R.C., I've done a little research, comparing buy prices of a few key items over the last 6 years. These quotations are approximate representations of wholesale value, and not by any means comprehensive, in that they do not take into account all P.R.C. buy lists for any given period.

(Prices are for VF NH)


1958 Kuan Han-ching s/s (Scott #357a):


2004: $ 65.00
2006: $ 75.00
2007: $ 85.00
2008: $ 130.00
March, 2010: $ 215.00 ; April, 2010: $ 340.00


1961 Table Tennis s/s (Scott #566a):

2004: $ 180.00
2206: $ 225.00
2007: $ 225.00
2008: $ 275.00
March, 2010: $ 800.00; April,2010: $ 1,180.00


1962 Mei Lan-fang s/s (Scott #628):

2004: $ 1,800.00
2006: $ 2,500.00
2007: $ 3,000.00
March, 2010: $ 10,000.00; April, 2010: $ 11,000.00

1964 Peonies s/s (Scott #782):

2004: $ 400.00
2006: $ 500.00
2007: $ 500.00
March, 2010: $ 2,000.00; April, 2010: $ 3,650.00

1967 Thoughts of Chairman Mao- unfolded strip of 5 (Scott #948a):

2004: $ 325.00
2006: $ 750.00
2007: $ 750.00
March, 2010: $ 2,500.00; April, 2010: $ 3,300.00


1967-68 Poems by Chairman Mao (Scott #967-80):

2004: $ 475.00
2006: $ 800.00
2007: $ 800.00
2008: $ 1,300.00
March, 2010: $ 2,200.00; April, 2010: $ 3,000.00


1968: "The Entire Nation is Red" (Scott #999A):

2004: $ 8,000.00
2006: $ 10,000.00
2007: $ 10,000.00
March, 2010: $ $ 60,000.00; April, 2010: $ 75,000.00


1978 Science Conference s/s (Scott #1383a):

2004: $ 140.00
2006: $ 150.00
2007: $ 160.00
March, 2010: $ 400.00; April, 2010: $ 490.00

1979 Study Science s/s (Scott #1518):

2004: $ 300.00
2006: $ 510.00
March, 2010: $ 1,600.00; April, 2010: $ 1,950.00

1980 Year of the Monkey (Scott #1586):

2004: $ 100.00
2006: $ 215.00
2007: $ 200.00
March, 2010: $ 800.00; April, 2010: $ 975.00

The gains are astounding, to the extent that they defy analysis. In certain respects, the situation certainly looks like a bubble. As the expression goes: "If it walks like a duck and quacks like a duck, then it probably is a duck." The only problem is that in this case, we're dealing with Peking Duck, a bionic "superduck" powered by tens of millions of Chinese collectors.

On the one hand, I can not advise buying many of the dramatically revalued items at their new stratospheric levels. On the other, I've been bullish about the Chinese stamp market for decades, and will not bet against it. In the long run, even the items which are currently being hysterically bid upward may turn out to be good investments. My recommendation is to wait until at least some of the dust has cleared, and the shock has at least partly worn off, and then target better items which have not been as hyped, and which haven't experienced such rapid increases in value. They represent safer bets, and their day will come.

General Commentary - Demographics and the Stamp Market

For anyone interested in investing in stamps, a demographic overview is crucial. Unfortunately, as far as stamp collecting in particular is concerned, hard demographic data are practically non-existent.


The problem is partly a matter of definition. In attempting to find out how many stamp collectors there are in the world or in a particular country, one must first ask: what is meant by the term "stamp collector?" The population of individuals who have saved at least a single stamp will be much higher than that of "serious" collectors - those who spend a significant amount of time and money on their hobby. Defining serious collectors using the amount of money that the individual spends on the hobby is also problematic, both because economic conditions vary from country to country, and because it is possible to be a serious stamp collector without spending very much money. Estimates of the total number of U.S. stamp collectors have ranged as high as 20 million, but based upon the number of collectors subscribing to major philatelic periodicals, membership in philatelic societies, and attendance at major philatelic exhibitions, a more realistic estimate of the number of "serious" U.S. stamp collectors would probably range from 150,000 - 300,000.


Worldwide, the figure of 50 million is a much-quoted estimate of the total number of stamp collectors. Again, there is the problem of definition - does the estimate include all stamp collectors, including those who are "less serious?" Would a broad definition of "stamp collector" increase the estimate to the hundreds of millions? And how many "serious" stamp collectors are there within this group?


For a philatelic investor considering investing in the stamps of a particular country, estimating the number of serious collectors of that country's stamps, and whether the collector population is growing, is extremely important, but also extremely difficult. One useful gauge, which may be derived from information which is available, is projecting a country's economic growth and whether the benefits of that growth are being spread around, or whether they are enriching only a tiny elite- in other words, does a particular country have a growing middle class? Even answering that question is insufficient, however, because less measurable cultural factors exist which determine what proportion of the population that can afford a hobby will collect stamps. Some nations, such as Germany, are more culturally attuned to philately than others. Another complication is that often, many collectors of a particular country's stamps are not citizens of that country.

Ultimately, the best solution for the philatelic investor focusing upon a particular country is to attempt to project the growth of its middle class, and then to make a very open-ended educated guess concerning the future of its stamp collecting population.