The Great Recession continues to have serious impact on the nation's employment picture, its housing market and, sorry to report, the market for US discount postage. For the last sixty years stamp collectors have bought and put away hundreds of millions of dollars worth of US postage stamps. This amount is far in excess of the amount that collectors would ever need for their collections, even if the most rosy forecasts of our philatelic dreams came true. Collectors do this for two reasons. First, until recently it was a relatively inexpensive to put away a couple of extra sheets of every new issue "just in case" any one of them got "good". Collectors like to tell the stamp equivalent of fish stories-the tale about the stamp that rose in value which was bought as postage from the post office. The economic nonsense of this (buying two hundred losers for one winner) is overshadowed by the bragging rights if you buy something that turns out to be good. And second, many collectors buy duplicates of newer issues really intending to use them on mail and then just never get around to doing so.
There is a huge amount of older US postage on the market that will never go into collections-and by huge, we are talking about hundreds of millions of dollars worth. This "discount postage" has traditionally made its way through the stamp market, being sold at a percentage of face value to dealers who would either use it themselves or sell it to mailing housing that would use them on packages and direct mail solicitations. The market for postage was good for most of the last thirty years, with collectors often able to sell the stamps that they shouldn't have bought from the Post Office for 80% of postage value. During the last ten years this has changed and prices have moved much lower. There are three reasons for this. First, rapid postal increases and higher postage rates have made many of the denominations, especially those below 20c, very cumbersome to use. Lower denomination US postage can now be bought on the open market below 50% of face value. Second, the new "Forever" category has begun an unhealthy bifurcation of the US postage market into "Forever" stamps, which trade at a discount but which will always be easy to use and which will move up in value as postage rates increase, and regular, denominated US postage which has weakened and will continue to do so even more. And third, the Post Office is making it de facto harder to use postage stamps on packages. Large mailers get presort discounts when they don't use stamps, and registered and insured packages need to go through a postage meter to be tracked. The harder it is to use old postage, the lower prices become.
If you are a small dealer or someone who sends a lot of mail, going into the discount postage market can be a good way to lower your mailing costs. But no one should be buying excess newer issues today. The price of such stamps just continues to go down. Discount postage has declined about 10% in the last ten years and I expect similar 10% declines for non Forever postage in the decades ahead.
There is a huge amount of older US postage on the market that will never go into collections-and by huge, we are talking about hundreds of millions of dollars worth. This "discount postage" has traditionally made its way through the stamp market, being sold at a percentage of face value to dealers who would either use it themselves or sell it to mailing housing that would use them on packages and direct mail solicitations. The market for postage was good for most of the last thirty years, with collectors often able to sell the stamps that they shouldn't have bought from the Post Office for 80% of postage value. During the last ten years this has changed and prices have moved much lower. There are three reasons for this. First, rapid postal increases and higher postage rates have made many of the denominations, especially those below 20c, very cumbersome to use. Lower denomination US postage can now be bought on the open market below 50% of face value. Second, the new "Forever" category has begun an unhealthy bifurcation of the US postage market into "Forever" stamps, which trade at a discount but which will always be easy to use and which will move up in value as postage rates increase, and regular, denominated US postage which has weakened and will continue to do so even more. And third, the Post Office is making it de facto harder to use postage stamps on packages. Large mailers get presort discounts when they don't use stamps, and registered and insured packages need to go through a postage meter to be tracked. The harder it is to use old postage, the lower prices become.
If you are a small dealer or someone who sends a lot of mail, going into the discount postage market can be a good way to lower your mailing costs. But no one should be buying excess newer issues today. The price of such stamps just continues to go down. Discount postage has declined about 10% in the last ten years and I expect similar 10% declines for non Forever postage in the decades ahead.