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The Automotive Chronicles

Monthly newsletter published by McLellan's Automotive History. Dedicated to literature collectors, restorers, museums, publishers, manufacturers and investors who collect and preserve automotive literature
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January 2005 Issue
 
ARTICLE
 
Good Investment? - Yes!
By Robert McLellan
 
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Our article "Good Investment?", which appeared in the November 2004 issue of the "Automotive Chronicles", received many comments — from praise to shock.

"Why hadn't I heard about this before?" The answer to that question is simple. Buying stocks and real estate is popular because stock brokers, investment advisers and real estate agents make a living off of people by promoting. Buying stocks and land is usually too complicated to do by yourself so you look for outside help and you are willing to allow these people to make a living by handling the transactions for you. Stocks and land have been recognized as investments for hundreds of years so most everyone feels comfortable with these methods. Few have ever thought of automotive literature as an investment much less researching its profitability.

Another question was, "How do land and real estate compare to literature as an investment?" Land and real estate increase in value with inflation, in general, cycling above and below average, with booms and recessions. Their real investment value is that you can live on the land, build on it, or grow crops on it while deducting it from your taxes. Therefore, in the end, it usually earns a profit. Still, like stocks, the increase in value is far from as impressive as that of literature.

Joe from New York noted that when we wrote the article in October 2004 the DOW Jones Industrial Average Index was at about 10,000 but is now closer to 11,000 and the all-time high was nearly 12,000 just a few years ago. His implication was that those highs would make a difference in our results. At 12,000 the DJI would have increased 3,329% since 1954. At 10,000 it was at 2,757% so the increase is not significant when compared to the average brochure increase of 26,475%. If the DJK were to double from its all-time high of 12,000 to 24,000 it would still only be a 6,757% increase which is not likely to happen anytime soon and still insignificant compared to literature. Joe, a long time literature collector and MAH customer, was also in the stock market. He was shocked.

"Can literature be sold as easily as stocks?" Good question. The easiest way to sell a single item is to put it on eBay, offer it to collector friends or sell it to a dealer like MAH. While eBay or a friend may buy a desirable brochure, book, dealer album, etc., at retail price, a dealer will usually offer only up to about 80% maximum on consignment and less for an outright purchase. Dealers have to make a profit just like the stock broker and real estate agent. Still, the profit to the seller is high because literature's increase in value over stocks is so much higher. The answer is, "Yes", it can be sold as easy as stocks if you are an experienced collector. Plan ahead when you collect for the maximum profit potential in what you collect and how you are going to sell it. Literature is an outstanding investment.

 
 
 
LITERATURE INVESTMENTS
 
Literature Life
Looking Both Ways
Golden Eras
Buying For Tomorrow
Good Investment?
Profitable Portfolio!
Unanticipated Investment
Today's Bargain Can Be Tomorrow's Treasure
What Is It Worth?
 
 
 

Disclaimer: The opinions expressed in the "Automotive Chronicles" are those of the writers' exclusively. Information contained in the articles has been obtained from sources believed to be reliable, but we do not guarantee the accuracy or completeness. When considering literature as an investment keep in mind that past performance is not a guarantee of future results. Some literature will not increase in value, and other literature varies in potential and results. Condition and desirability are important factors in considering any literature for investment.

 
 
The Automotive Chronicles, January 2005
 
 
 
 
 
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