Monthly Archives: April 2012

World War II wasn't even over before it was clear that the Allies weren't really allies at all. The deal that was brokered between Truman and Stalin was twisted by the Soviets to gain them domination of Eastern Europe including half of Germany. By 1948, Berlin had become a symbol of what the Cold War was to become. Berlin was in the Soviet dominated part of Germany and the allies were by treaty allowed access to half of that city. The Soviets made that access very difficult and, after a currency dispute in 1948, laid a blockade on all land routes to Berlin. The allies began an Airlift, which supplied the western part of the city which remained under allied control. It looked for a time as if WW II was about to break out again, this time between the Soviets and the Americans. Tempers cooled and the blockade was lifted. To solidify and emphasize western political commitment to West Berlin, the German government began issuing stamps for Berlin proper separate from the issues that

Seigniorage is the profit that governments make on securities that they issue, on which they don't pay interest, and that are retained unused by the public. Cash in mattresses represents a form of seigniorage and, more than anything else, old face value postage stamps held by collectors do as well. The money that collectors have tied up in mint stamps represents an interest free loan to our post office. And because most mint stamps held by collectors will never be used, the profit to the post office is the value of those stamps held by collectors (Private companies issue gift cards and they are required by accounting rules to bring the unused portion of these cards into income-this is a sort of private seigniorage). For many years philatelic commentators have speculated that seigniorage was the reason that our Post Office pushed philately so hard and the reason that so many new issues had esoteric themes ( designed to entice noncollectors into buying them and putting them in a drawer).

The problem of what quantities exist of different classic stamps has been one of the great difficulties of philatelic research. Before the days of the Internet nearly all classic stamps that were sold were not illustrated so it was impossible for any census taker to know if he had counted a given specimen before. Counts of stamps such as United States 5c and 10c 1847 tend to be little more than guesses. We know that approximately 3.8 million 5c and 900,000 10c stamps were sold over the postal counters (that is delivered to post offices and not returned as unsold). But how many have survived the ensuing 160 years and still exist in collectors hands? Such numbers are important for anyone pondering stamp prices-whether such prices are higher or lower relative to popularity than they should be. Are there large quantities of US #1s in dealer hands that would preclude prices rising very much were demand to increase? What would happen if these quantities were dumped? Such questions are important

The United States Seneate has passed a bill to "save" the Post Office which reads like a kick-the-can document. It makes a few accounting changes but forbids any post offices closings and delivery changes for two years. And, it says nothing about postal rate increases that are necessary as part of any Post Office bail out program. This bill shows why the Post office has gotten into the position that it is in. Politcal considerations, added to rapid technological changes, have made the Post Office unprofitable. There are too many post offices. There are too many loss making destinations in America and a two or three tiered pricing system would be required if delivery costs were being considered in postal pricing. And our postal rates are very cheap compared to the rest of the world (with Switzerland being the highest in the developed world, charging 98c to deliver a first class letter).

The comedian Rodney Dangerfield had a shtick worthy of the way many philatelists think of their hobby. He was always complaining that "I get no respect" and about being disdained and he turned the act into a respectable fortune with a large Las Vegas revue and numerous movies and records. Many collectors feel that they and their hobby don't get enough respect, though I think the reality is a bit different. I think much of the general public doesn't understand philately and the motivations behind it. Most think of it as a childhood hobby that adult collectors simply haven't outgrown. This plays into the Dangerfield feeling. Children think that they don't get enough respect. As they mature they realize that respect is earned by one's accomplishments and how one comports oneself. The collectors who feel respected in their hobby are the ones who enjoy philately in a mature way-emphasizing the joys of study and completion rather than material acquisition. And just as people tire of stories

The first stamp issued in the world portrayed the ruling monarch of the issuing country (Great Britain Penny black). After that it became protocol to use the portrait of the ruler of a country on postage stamps or in the case of the United Sates to use a deceased president or statesman. Some countries without a strong national ruler might use a national symbol as in the case of the first issues of Canada which show a beaver. Many European countries, such as Russia and many of the German States showed the Coat of Arms of the ruling family. But France began what what was to be a tradition on most of her nineteenth century stamps by using a allegorical image, which on the first stamps was the goddess Ceres, the deity of agriculture who also represented prosperity. France political life was troubled throughout the nineteenth century with Kings being replaced by Emperors which were superseded by Republican forms of government before going back to monarchy. Perhaps this is why for her first stamp

A remarkable aspect of philately is that unpopularity breeds further unpopularity. It is truly unusual to see a good collection of nearly any South and Central American country. Brazil, Argentina, Mexico and Cuba are exceptions, but for the other twenty or so countries that make up rest of the southern Americas, collections that are even 75% complete for major Scott numbers are quite rare. The reason is financial but not in the way you might think. Tae Ecuador, for instance. It is a country that is just below average in per capita income but with a large middle and upper middle class and several large cities (philatelic popularity is related to rates of urbanization). There are few real rarities by price among its stamps. Its issuing policy is conservative and appropriate. It should have a decent number of domestic collectors as well as an active expatriate collecting community and yet I can't remember the last time I've see a mostly complete Ecuador collection. The same is true of most

Robberies of stamp collections used to be a real problem. In the 1970's a large ring of stamp thieves were caught. They had an APS membership directory with them that they were using to figure out who to knock off next. When I was on the Board of Directors of the APS in the early 1980s, my home was burglarized, as were the homes of several other board members. But, stamp thefts have decreased in recent years and usually when philatelic materials are stolen it is part of a general burglary and not stamp specific. Insurance rates for stamps have dropped dramatically in real terms over the last thirty years. The reasons for the decrease in stamp theft are three. First, stamp prices have declined relative to the value of most other things. A mint US #C18 sold for $200 in 1980. It sells for $40 today and at the price levels for most stamp collections the risk of stealing them is not worth the reward. (Crooks are among the most rational economists around). Second, stamps are hard to fence. The

Buying already made collections at auction might be one of the greatest bargains in philately. Next week in our public auction we have an interesting world wide collection.(4367) It is in several Scott International volumes of the kind that were so popular for world wide collectors thirty years ago. This collection was created over a thirty year period by one collector and has over 55,000 different stamps in it. The stamps are truly world wide in scope, from over 359 philatelic issuing entities. It is remarkable the amount of time collectors of the previous generation put into their collections and how many stamps they acquired and how comprehensive a collection they could create. And what is as remarkable is how inexpensively these collections sell for on the resale market. The collection in our auction has 55,000 different stamps in it and if we estimate that the average stamp took the owner two minutes to purchase, catalog and mount correctly (and it had to take more) then

The unimaginable has begun to happen. After growing at rates approaching 100% per year the last few years, the market for better People's Republic of China stamps has cooled and prices are down as much as 30% in the last few months. There are several reasons for this. First, the Chinese economy has definitely slowed this year with growth rates half of what they were in years past. In part this is because the Chinese economy is being impacted by the world wide recession which the Chinese have been fortunate enough to avoid up until now. Second, the Chinese property and stock markets have fallen back and much Chinese money that was coming into stamps was speculative money that had been made in the stock and property market. But the most important reason for the fallback in price in PRC stamps is simply that the stamps had gotten too high in value. Speculators always forget that commodities like stamps have no intrinsic value and are only valuable because collectors want them for their collections.

Harry and Sally were an older stamp collecting couple that were already long established favorites at our shop when I started in the stamp business forty years ago.  They had met in their youth at a local stamp club and though they each maintained their own collections (he was a GB collector, she saved Canada) together they collected US plate blocks and they did it in a substantial way. Two or three Saturday mornings a month they came to our office to see what was new in stock and it was unusual that they left without smiles on their faces. By their own account, they had never been "blessed" with children, but their love for each other and the time they spent together seem to fill them completely. In their seventies, Sally got sick-cancer I think- and after a long period of decline she passed away. It was quite a while until we saw Harry again. He came in with his GB album and began adding stamps to his old collection. Months later I asked him about the US plate blocks and was he going

 Philatelically, the postage stamps of the United States are probably the most interesting and complex to collect of any area. US Philately has the largest body (and most interesting and valuable) of Postmaster Provisionals, stamps issued before national postage stamps by local postal authorities (no doubt we lead in this area because our Federal system has always facilitated local identification). Only Switzerland has issued more than a few Postmaster Provisionals and ours are far more difficult to find. US general issues are among the most complex. Our Reissues and Special Printings are virtually unheard of in any other area. We have scores of varieties of grills, a process which only Peru shares with us. Our Officials and Newspaper stamps are the world's most interesting and complex. US Revenues are a world of their own and dwarf the revenues of most other nations. Our Carriers and Locals are a vast field all of their own and again the head of the class of in terms

Virtually any topic or theme can be collected. But of the collectible topics and themes, the most interesting are ones that go beyond the pictures of the stamps and tell a story that is bigger. I just came across an eight volume collection of Penguin philately. It consists of thousands of stamps and covers from over forty countries going back to the 1940s. The collection has just about every stamp issued that has a penguin pictured on it to the year 2000. It had hundreds of Antarctic Expedition covers. Scientific expeditions to the Antarctic have been going on for over 100 years and have heated up in recent years as concerns over global warming have made better temperature measurements and glacier melt rates important to monitor. Many of the expeditions partially fund themselves from creating covers and stamps for philatelists. Even the ones that don't have any official government sanction find that the scientists are moved to create philatelic items during the tedium of the 24 hour

Based on American Stamp Dealer Association membership, APS dealer members and a survey of the larger EBay and Internet dealers, I would estimate that there are less than 2500 full time stamp dealers in the United States. Many collectors sell their duplicates, some build inventory towards eventually dealing full time, and there are many part timers who supplement their income and hobby with part time stamp selling. But full time philatelic professionals who make their entire livings from selling stamps and only stamps are a rare commodity. This is because it is very difficult for most dealers to make much of a living from stamps. Let's look at Hy Pothetical's business, a dealer of my acquaintance. Hy does $30,000 business a month-a number most dealers wistfully aspire to. Hy has 30% margins on what he buys so his $30,000 in business has a cost of sales of $20,000. He sells on Ebay and the fees and credit card fees run about 12% of sales (about $3600), less office rent, an employee