Recession and Rickenbacker Values

[ethanrusso]

If you're like me, you scan Craigslist and E-Bay frequently to see what's up in the vintage Rick market. It seems like they're some screaming deals out there right now, which is great for the buyer with cash, a condition that does not describe many of us. Me, I'm just a voyeur at present, it seems.

I have been led to believe that vintage guitars are one of the few investments that retain value, but even that maxim seems challenged right now. The question I'd pose is: How long do you think it will be before vintage Rickenbackers regain their prior price stature?

[antipodean]

That's tough to answer, as the market for vintage guitars, the market for vintage Ricks, and the world economy aren't perfectly correlated. On top of that the world economy is looking about as unpredictable as it ever has, particularly given that one of the main drivers, China, is impossible to read given the controlled nature of data that they release. It comes down to "ifs". An important thing to remember is that, at the peak of the vintage guitar market, the world economy was in bubble mode, so the highs may not be seen for some time.

If China is not in a mess, but is going through an orderly correction period (where they revalue their currency and raise interest rates to moderate growth) then the world economy will be flat for 6-12 months and then have a moderate recovery. Prices will go up before the figures verify that recovery is really kicking in, as markets tend to lead the cycle. The price of Ricks will probably trail that of the "blue chip" vintage guitars ('50s LPs, Pre-CBS Strats and Teles). We may get back towards the highs in a 3-5 year window. Of course, the lack of depth of the Rick market means that the entry of a volume buyer (or seller) could really move prices quickly.

If China is in a mess, (such that their financial system willl be hit by massive defaults from a possible property/speculative investment bubble) then it will take them a couple of years at best to work out of it, and vintage Rick prices will be the least of our worries.....

I'm favouring the first option, as much out of hope as anything else....

That probably doesn't really help....

[collin]

To be perfectly honest.......I don't think the guitar market is being slammed as hard as people WANT to believe it is.

Want to see for yourself? Go to a vintage guitar show. People buying stuff hand over fist, and at solid prices too. I went to the local Costa Mesa guitar show a few weeks ago. A friend of mine sold 6 guitars, and prices were all pretty high at every booth there (and selling!).

I've seen some Rickenbacker models fetch record-high prices during the "worst" of the recession (Roger McGuinn LE models, for example).....and while the market cools on certain models like it normally would, people interpret that as being caused by the economy, and not the market being saturated with a particular market and cooling off (which it does no matter what the state of economy).

Sure, people with $250,000 Les Pauls may take a hit selling them now, but the market of people buying guitars like that are very very slim compared to the general market of vintage guitar buyers.

In general, I think guitars are a bad long term investment, as I truly believe they won't keep up with inflation in 30 years, as the demand dwindles from baby boomers passing on. I'm 25 years old, and in the vast minority of young people who know enough about vintage guitars to care at all (that means I get to buy all your guy's guitars cheap as chips when you kick the bucket. ).........but for 10-15 years, I think they are a way better investment than houses or "imaginary" investments like stocks etc. You can hold, appreciate and benefit from them, without the maintenence and taxes of property ownership, or the constant worry about how many cents your invisible stock went up or down on any given day.

Heck, even if your guitar loses all value, you can lament by singing the blues with it.

[jamfanman]

In general, I think guitars are a bad long term investment, as I truly believe they won't keep up with inflation in 30 years, as the demand dwindles from baby boomers passing on. :

I theory I agree with collin, however its not really about investment is it. Rics are a thing of beauty and i doubt they depreciate like most cars.
I hope future generations will get away from 'x factor' musicians (V loosely used) and rediscover what the baby boomers loved and still love. my kids though into unbearable/unlistenable music (starting to sound like my dad) are told to appreciate my rics and treat them very much as 'part of the family'

[Scastles]

Unpredictable is right. So goes the economy, so goes just about everything else most of the time. I've seen some Ricks sell for unbelievable prices, and others which you might think would fetch more, fall far below.

Long term is just as unpredictable IMO. For those of us who were around in the '50's and '60's possibly living in a newly developed suburb, with the newest Chevy or Ford parked in the drive, the word 'vintage' was Greek. When every other kid discovered his mom had thrown out his old baseball card collection did vintage take on value. Since then we've gone from discarding for any price to collecting, from cars to guitars. That being said, it is much for enjoyment as it is value. However, it may be that once we 'boomers' have trekked off, much of what we term as 'collectibles' might trek off with us. Especially the guitars of our youth because the vast majority of the buying power of these guitars is still coming from these same 'boomers'. Just MO.
But who knows, maybe the future generations will find the same values in these guitars, or they may be collecting vintage iPods

[vintagemusicgear]

That's a loaded question that I don't think anybody can answer. I used to believe that vintage guitars were a "baby boomer" thing. But I also believe that the younger generation will still be interested in vintage guitars, as long as they listen to the Beatles, the Who, Led Zep, Clapton, Hendrix, etc.....I know of some very young collectors who are very serious with vaults of expensive vintage gear. For the past 20 years, there were many times when people were saying the vintage guitar market was over. I think the market has slowed down because of a WORLDWIDE recession (nobody is really doing well) and that prices went up wayyyy too high in the mid-late 2000's. But as long as "young" people listen to the good stuff, I think there will always be a market. AND, if the Chinese, like the Japanese, can get their economy together, all the youny Chinese players are going to want vintage gear in my opinion.

[vintagemusicgear]

There is also another factor. As a player, I have NEVER played a reissue that I liked more than the vintage counterpart. Try as I may over the years, I wanted to really find some reissue guitars that I felt played and sounded just as good as the originals, but no luck. This goes for Rics, Gretsches, Gibsons, Fenders, etc. It also include amps (Marshalls, Voxes) and especially vintage drums. I'm a drummer too, and the new stuff just sounds like cardboard. Plus, I prefer how a vintage guitar, amp and drums FEEL. There is something to the feel of an old instrument that cannot be reproduced, in my opinion. So many players out there will certainly gravitate toward vintage gear. I have a number of friends who are real players in Nashville, and most of the real players only play vintage gear....Plus all the studio guys I know gravitate toward vintage gear for recording. So there will always be a market for vintage stuff.

[collin]

There is also another factor. As a player, I have NEVER played a reissue that I liked more than the vintage counterpart. Try as I may over the years, I wanted to really find some reissue guitars that I felt played and sounded just as good as the originals, but no luck.

Absolutely. That's been the straight truth in my experience.

I think that reissues work best for people who have never played the real thing. Ten seconds with a 40-50 year old vintage item, and the reissue will seem awkward, clunky, and foreign. Unfortunately, the number of people who have played vintage guitars is low enough to sell tons of reissues.

Every time I catch myself thinking "wow, I wish _____ company would reissue _____ model," I then remember how different it would be from the original item, and it doesn't sound like a good idea anymore.

[ethanrusso]

Collin (my son's name!)--- you are wise beyond your years.

David, while I know you're right, finances dictate that I stick to reissues for the moment, and I'm temporarily very happy with my 360/12 C63. Someday, I would love to be in a position to take a couple of those fine vintage beauties shown in your videos off your hands---- maybe a Fireglo Capri 360, and/or a 360 OS and/or 381 when my ship comes in.

[collin]

Thanks Ethan!

What I should have mentioned was, Reissues have a great place for guitars that are far beyond normally affordable guitars.

You can be sure my 60's spec strat and Les Paul Standard are not late 50's items. Reissues will have to do!

I guess that's why I like Rickenbackers. Along with Gretsch, you can still buy a standard vintage model for similar prices to their modern counterparts (even if rarer models like RM, OS, Lightshows, Capris etc) are high dollar items.

[vintagemusicgear]

Collin (my son's name!)--- you are wise beyond your years.

David, while I know you're right, finances dictate that I stick to reissues for the moment, and I'm temporarily very happy with my 360/12 C63. Someday, I would love to be in a position to take a couple of those fine vintage beauties shown in your videos off your hands---- maybe a Fireglo Capri 360, and/or a 360 OS and/or 381 when my ship comes in.

Hi Ethan,
Yes I see your point. I think Collin said it pretty well, reissues definitely have a place and purpose. If I want a Gibson burst, I'm buying a reissue! With that being said, I bought my first "real" vintage guitar after sellilng a couple of non-vintage guitars, and I got hooked....I agree with Collin that the vintage market is not that bad. The good stuff is still in collections. Much of the stuff that is on "sale" are guitars that are not desirable (mid 60's strats for example), guitars with issues, or guitars that don't play or sound good. Most of the major collectors are not selling any of their good stuff. And if you ask some of the younger dealers like Olivia's, they are very enthusiastic about the market moving forward with newer players and collectors appreciating vintage gear. I'm only 45, and I plan on playing and collecting for a long time.....I think once the world economy corrects itself, everything will be sellilng again (guitars, homes, cars, etc.....)

[vintagemusicgear]

Plus if you want a capri or and F series, or a vintage Vox 7120, or a real Ludwig black oyster pearl kit, gotta buy the old stuff. Some gear is just not going to be reissued.

[billydlight]

Here's the trick.... Buy cool old Rick player guitar, sounds great , looks Great, costs 2400.00 play 10 gigs with guitar, guitar is paid for. Guitar is still worth 2400, (maybe more) if/when you decide to unload it after playing many gigs. You are now WAY ahead and your investment has made you a bunch of dough!!

This is the way I do it

[collin]

That's a pretty good setup, Billy!

Now.....if I just had enough skills to get paid $240 a gig!

[xcoyle]

People on wall street got upset this week. I just enjoyed my new "investment"