Lets be Realistic People

[DoNotInsertIntoMouth]

I'm going to take a few moments to take a page out of my co-worker's book. He is a blunt man, and generally if something is wrong in the office, he sends out an email and copies everyone on it calling out whatever is being done (like not filling the coffee pot) and whoever is doing it. Not the best way to go about things, but results are there.

 

He signs them "Crotchety Old Man" (hes 29)

 

So here is my Crotchety Old man Post:

 

A few things I want to put out there. These are facts IMO (clashes I know) that some people should know. I think people throw around silly numbers and comparisons way too much. You can say "Well we are free to think this - its not hurting anyone!". But it is. there are a lot of new members who listen to a lot of us. Its a responsibility to just be freaking realistic. So here are a few. Others feel free to add

 

Sets aren't going to grow to 5x retail in most cases (99.9%)

 

There certainly are sets that do. But these are insanely far and few between. Throwing out these silly numbers like "200$ next year!" on a 30$ set is silly. The ones that do that are certain cases, like the Zombies which no one knew about and was out 4 months.

 

This stuff about sets growing in insane amounts is starting to get silly. For a lot of the reasons I am going to talk about tomorrow. But I have heard things like :

 

1500$ by christmas (last year) - 4x4 special edition crawler

$800 - for the fire brigade and GE

$1500 for the Tower Bridge

300$ by this christmas - Battle of Helms deep

 

These prices are silly. What sets did in the past is relevant, not the telling case. Things are different and changing all the time. You have to be realistic. Will some sets surprise? Yes. But they aren't going to triple, quadruple, quintuple constantly.

 

The market is completely different than it used to be

 

I was certainly not around then. But its clear and obvious things are different. Some are for the better - Lego is as popular as it has ever been.

 

However, the investor market is probably 100x or more congested than it used to be. Are sets going to stop growing? no. But the top values are going to go down. This is why sets aren't quadrupling all the time.

 

Ask someone like Mos_Eisley. There was a time you could store any Star Wars set and chances are it would triple. Not that way now in the least.

 

The market is certainly not dead. Things like the Fire brigade prove that. But its not growing like the old modulars. Lets be real.

 

There is no difference between Flipping and Investing. Flipping is just a short term investment

 

Lets just stop all the arguing over which is better and all this stuff. You know whats the best? Keeping the set for the shortest amount of time while paying attention to maximizing the value proportionally to it. You know what thats called? Being fiscally savy. Flipping/investing... who cares?

 

Pretty much no one knows when a set is retiring

 

More pointed at the people listening, not the people saying it. Don't listen to pretty much anyone that isn't a direct corporate higher up at Lego in terms of set retirements.

 

My rule is this:

 

Did the person say they know that the set is retiring now? 

 

If no: Good.

If Yes: don't listen to them, they don't know.

 

Investing and especially parting out is difficult

 

A lot of people join this site, get excited, but sets, and then disappear. I have to believe that some of these people bit off more than they can chew, etc. But the reason is a lot of people make things sound too easy. BUY THIS - EASY MONEY! I do this some too, and I have been trying to word things better.

 

Keeping track of all this is tough, and it will only get tougher. As the investor market fills, we wont know how things will work, but profits are going to continue to go down in most cases. You have to be smart, savy, know your history, be able to take care of taxes everything else.

 

Collect as much as you can, invest only after you have done serious thinking about what it means, the time that goes into it, etc.

 

Feel free to ask me. I am not an expert, but I can share my experience. While being very successful, I have had some hiccups and some that could have been serious. Its important to know these before hand. Don't jump into anything. There are 100s of things that are much more important that money, most that you can't buy with it anyway.

 

 

End (calm) Rant

 

 

Overall, just build Lego sets people. If you haven't, you need to shutdown your computer, turn off the TV, and enjoy one of the best gifts to our world.

 

 

[jaisonline]

Is this your Jerry Maguire moment?

Good post. Straight to the point and honest.

[DoNotInsertIntoMouth]

Is this your Jerry Maguire moment?

Good post. Straight to the point and honest.

 

That made me smile. Yes it definitely was.

 

Mostly just feel bad for the people that make bad decisions on unrealistic info and then will regret doing things, or give up because they think they aren;t seeing what they should.

[TheDarkness]

People also have no patience these days. It is all about instant money and expectations. 

[stephen_rockefeller]

What waaaaaaa? I thought that this was easy money? Why else would I get into this when I have no interest in Lego whatsoever? Mars rovers for everyone you feel me!

[belljohn]

Thanks for the post, and let me add one more.  Even when I was investing 8 years ago,

 

I was happy when I could double my money after fees within 2 years of retirement.  

 

That is still a good return on your investment even if you buy 2 years before retirement, almost 20% ROI.

[fuzzy_bricks]

That made me smile. Yes it definitely was.

 

Mostly just feel bad for the people that make bad decisions on unrealistic info and then will regret doing things, or give up because they think they aren;t seeing what they should.

If people would take a minute, and by a minute I mean a long enough time period to properly do their research, then they should be able to keep their expectations in check.  People need to be smart with their money, and being able to filter the BS is part of that.

[Jeff Mack]

I really can't argue with anything you said.  I appreciate the post.  At times there is a lot of BS flying around on topics that people really don't have any facts on.  It makes for good conversation and at times I really enjoy reading it.  This is not an easy thing to do at all.  It takes a lot of time and capital.  I applaud the people like you that sit there and take tons of picture of little minifigs.  I don't have that patience.  Ed and I just keep buying crap, I really don't know if anything will ever get sold

[justafrog]

I'm not a huge fan of people spreading mis-information to newbies... but on the other hand, people who are looking for "easy money" are going to fall for something. If it's not "quadruple your investment by Saturday by selling in the TRU parking lot!" here, it'll be a Nigerian prince who wants to send you millions of dollars for the low-low price of a couple thousand, act now and you'll get a set of steak knives.

 

I don't think there's any way to save people who won't do their own research and can't operate a calculator.

[Jackson]

Veterans know that buying and selling is hard work.  It takes a ridiculous amount of time, energy, and patience.  I'd advise newbies to stay away and just get a pointless government desk job if they are looking for easy money.

[hepcatpunk]

Agree.  Nice post.  A lot of "follow the herd" mentality and hyperbole in a lot of the posts on this site.  I find myself hardly posting any longer b/c of it. 

[exciter1]

 I'd advise newbies to stay away and just get a pointless government desk job if they are looking for easy money.

 

What if you already have one and you're still here?

[Alpinemaps]

What if you already have one and you're still here?

 

You rang?

[exciter1]

Is this the wrong thread for me to predict the Quinjet will be $100 by Christmas?

[Migration]

To fan the fire a bit, I've worked with people like you grumpy office mate and whenever they would send out an email like that I would reply all that someone sure needs a vacation.

To be clear I agree with most of what you wrote. Except the Rover. That baby will be $350 by Christmas.

Sent from my iPhone using Brickpickeraaaaaaaswssssswssa

[Alpinemaps]

Can I add one or two things?

 

Have a plan, and stick to it.

 

Does it have to be a formal business plan?  Maybe.  Maybe not.  That's up to you.  But have some sort of plan.  Just randomly buying things because you see other people snapping them up isn't a good business plan.

 

Just sit down and figure out how you're going to invest.  Exclusives?  Modulars?  Small sets?  A combination of things?  It doesn't really matter.  Just make sure YOU know what it is.  Maybe you want to focus on Star Wars.  Or City Sets.  Or Chima.  Whatever. 

 

Invest in what you like

 

You'll have more fun that way.  Find the sets and themes that you like.  Don't worry about the stuff you don't like.

 

Have a goal

 

Figure out what you're trying to get out of this.  Why are you investing/flipping/whatever?  What is your end game?  Are you strictly trying to invest to make money?  If so, how much?  What's your ROI?  Are you trying to invest to pay for your habit?  That's cool too.

 

 

After trying to figure things out over the last year and a half, I've definitely come to some conclusions.  There's tons of different spaces in the investment world.  Trying to get your finger into all of them is potentially dangerous.  Focus in on the areas you want to be strong in, and you'll have success.

 

My own story - I've dabbled here and there in lots of things.  But I've learned what I think will work for me, so I don't dabble nearly as much.  There are themes I've picked up in the past that I'm just not going to focus on anymore.  There are things I've ignored that I will stop ignoring so much.  My primary goal is to pay for my habit.  Everything else is icing on the cake.

[@rtisan]

Well put! I personally invest on the side, I`m a collector first and fore-most. Said it before, but to me this is a hobby that I hope will eventually pay for itself. Not a source of income, part of a business, etc. Keep track of everything and as always, pay my share of taxes. Haven`t sold a whole heck of a lot online anyway, so haven`t really had to worry about that department. Still though, this is fun, being a part of the community is fun, and I hope it will continue to be just that. It`s great to have a hobby and a place to discuss it with others who enjoy doing similar things. Honestly I just look at it like that, try to be realistic, while at the same time allowing for a bit of imagination.

 

Thanks everyone for making the community here great, and of course, thanks to Jeff and Ed! 

[Quacs]

For fear of throwing this in a different direction, here's my thoughts on another one:

 

TLG isn't out to get you

 

Conspiracy theories make for fun conjecture and great theater, but TLG is not a puppeteer organization pulling the strings of retirement decisions and inventory in an effort to screw with the secondary market.  Have they implemented broad policies aimed to curb resale?  Sure - we all know about their policies to restrict B&M exclusives to the Lego Store and eliminate discounts on exclusives.  But retirement decisions are made well in advance of stock shortages.  Sets pop in and out of inventory based on the inventory leveling their warehouses perform routinely.  There isn't someone in a Lego lab coat behind a laboratory bench with a mean look on his face mixing fluorescent chemicals to figure out the best recipe to mess with resellers.

 

Similarly, S@H bans occur when a buyer's purchase patterns fall within pre-established "red flag" criteria.   You will risk a ban if you exceed purchasing limits, not when the TLG sales manager misses his/her morning coffee.  Other than the occasional ban of a VIP member with the same eBay account name, S@H almost always bans people for buying too many exclusives too quickly.  A little bit of prudence in timing and quantity of purchases can go a long way to protect your good standing with S@H.  

 

Newbies should relax about buying from TLG.  Stay within the purchasing the limits, limit your exclusive purchases on S@H, and use Lego Store and S@H to take advantage of the good promos and giveaways, rather than to purchase 40 of one exclusive.  Use other the retailers to build your exclusives inventory.

[belljohn]

Investing in what you like is great advice.  When I branch out into a new theme, I only buy sets I would love to give as gifts.  When I started, I only invested in Star Wars because if it didn't pan out, I had birthday and Christmas presents for my kids until they went to college.  I also took a chance on the 50% off Duplo Big Zoo (my one and only Duplo purchase) because I knew I had lots of nieces and nephews who would love it as a gift.

 

Have fun, make money.  You can't beat that.

[gregpj]

I've got a couple more...

 

Use Your Own Best Judgement

 

So many people seem to think the way to easy money is asking for someone else to make their decisions. There is nothing wrong with sharing decisions and asking for opinions, but sometimes it feels like people want instant gratification by letting someone else make their decision. I know... "stay away from those topics if your not interested" but for goodness sakes, it's your money, take care of it like it's your money.

 

Don't Post Just Because You Can

 

There are people on this board who reply to just about anything. Opinions are like ..... everyone has one and they shouldn't always be shared. Being helpful is one thing, but filling the forums with nonsense, is well, nonsense.

 

PS DNIIM - that last one is not directed at you and your 7500 posts. I find your posts to be good reads and not just full of fluff.

[Migration]

That sounds like a cat poster.

Sent from my iPhone using Brickpickeraaaaaaaswssssswssa

[Pseudoty]

I agree with you on needing to be patient. But I would advise the ones that are being patient and stocking up on lots of sets to give selling a try just to make sure you are up for it. As you know DNIIM I am OCD when it comes to packing my sets and it takes time to do it right and things can still get lost or damaged. I saw one person post that the part out a minor set with the figs on Amazon, some parts on Bricklink, and the rest on EBay. That's just too much work for me to make $3.

Too much work that's why I stopped flipping.

When your new on this site and looking for opportunities it easy to get caught up in the HD, WVC, VC, FH go get them hoard mentality. The DD thread is great for finding steals but sometimes you have to pass because it is not in your plan like today the TB for $180. It will be hard to compete with all that just got it at $150 as people either don't know how much profit they are, or should I say are not making as you see slimmer margins on eBay due to increased competition. I went thru this with Beanie Babies you have to know when to get out

Too much competition that is why I am getting out of investing.

We had a major storm here last week and I lost a huge tree. It could have been worse, it could have fell on the house or have been a tornado and the three rooms of lego that I have, a lot of it is junk sets bought on clearance because it was on sale, would all be gone. I haven't decided if I will sell off mostly everything this Xmas season, or make one of those listings on craigslists that look like a too good to be true scam, or just let my sets age, but I will be content to collect and build sets, still looking for the best deals on something that makes me happy

Edit stop PMing me NO I am not giving away my Mars Rovers but I do have 19 CCP ;)

[DoNotInsertIntoMouth]

I'm not a huge fan of people spreading mis-information to newbies... but on the other hand, people who are looking for "easy money" are going to fall for something. If it's not "quadruple your investment by Saturday by selling in the TRU parking lot!" here, it'll be a Nigerian prince who wants to send you millions of dollars for the low-low price of a couple thousand, act now and you'll get a set of steak knives.

 

I don't think there's any way to save people who won't do their own research and can't operate a calculator.

 

Very good point. I generally try to believe people are smart and are just mislead. My job leads me to believe otherwise.

 

To fan the fire a bit, I've worked with people like you grumpy office mate and whenever they would send out an email like that I would reply all that someone sure needs a vacation.

To be clear I agree with most of what you wrote. Except the Rover. That baby will be $350 by Christmas.

Sent from my iPhone using Brickpickeraaaaaaaswssssswssa

 

Oh yeah I reply just to be a ****** to him. 

[brickelements]

Veterans know that buying and selling is hard work.  It takes a ridiculous amount of time, energy, and patience.  I'd advise newbies to stay away and just get a pointless government desk job if they are looking for easy money.

Hey I have a pointless government job. Why do you think I have been doing this for three years. My inventory is just now starting to ripen. My before taxes but after fee goal has been 26% annually. So far so good. I bought a lot of exclusives when they were allowed to go on sale.

Now the real work begins. I am terrible with taxes. I need an accountant once I turn this into a real business/llc so I can enjoy all the little deductions to get back some of my profit the gov steals.

[BrickLegacy]

This topic is slowly becoming a treasure trove of great investing advice for investors of all experience levels.  Thank you all for contributing, and a special thank you to DNIM for starting this.

 

I'll add this.

 

Read between the lines

 

Some of the more experienced investors on here provide very valuable information to us.  They don't spoon feed it, but they certainly give us subtle hints.  If you spend enough time following the daily deals and reading the more informative threads, you can slowly accumulate some great tips and insight into how the pros operate.  This is something I observed and I appreciate those members who show their hand every once in a while.