2/10/2017 1 Comment
Post by Evan Yore
China Changes Stamp Collecting Worldwide: How One Country Influenced Stamp Prices
The hobby of collecting stamps is not a new one, and it’s one that has amused and intrigued enthusiasts of all ages for years. The earliest recorded stamp collectors date back to the late 1700s, even before stamps were used for postal purposes. The pastime caught on and spread throughout the world after that, reaching a peak in the United States during the 1970s. Popularity has faded slightly since then, but the hobby lives on through all of us that still enjoy it.
The History of Stamp Collecting
Many point to Irish Receiver General of Stamp Dues John Bourke as the world’s first recorded stamp collector (1). At the time, he created a book of embossed revenue stamps and hand-stamped charge marks. His collection still exists today, carefully preserved in the city of Dublin, in the Royal Irish Academy.
Britain issued the first posted stamp, called the Penny Black, in 1840. The design featured a youthful Queen Victoria. There were no perforations, so it had to be cut by hand from the sheet when used. Used versions can be found for between $20 and $200.
Stamp collecting was a big deal in postwar America. Peace made it more affordable and accessible. A renewed sense of national pride also encouraged people to collect stamps. During this period, stamp collecting was considered a symbol of all the good things Americans believed in. There were more than 1,000 prominent stamp dealers in the U.S. by the 1970s.
Hobbies like stamp collecting tend to follow trends, even when they have a long history that dates back hundreds of years and spans multiple continents. So what is it about Chinese stamp collectors that has influenced prices and availability so significantly?
China’s Love Affair with Philately
It may sound surprising that so many people in a country would suddenly become interested in a single hobby however there is a good explanation for why philately has seen a boom in China. In an effort to keep the country’s history in mind, the government in China began a campaign to promote stamp collecting among younger citizens. Teachers at all grade levels followed recommendations to create clubs for young stamp collectors to spread the word. Stamp designs usually included artwork depicting historical people and events.
Stamp collecting may be viewed as an old fashioned hobby in many parts of the world, but in China it’s considered a status symbol. Those who collect stamps are viewed as part of the middle-class and are often considered more scholarly and respectable.
China Pushes a Downward Trend in Stamp Prices
China’s involvement in stamp collecting has changed things globally. The country’s bankers and investors were searching for ways to diversity portfolios in non-traditional ways. One popular way to do that was to buy treasure assets. A treasure asset refers to a tangible item that’s purchased like classic cars, paintings, or rare coins. This approach was appealing because the investor could avoid losing money through financial repression while also avoiding many tax burdens.
Guy Tolhurst, the managing director for Intelligent Partnership, a company specialized in alternative investment in the UK, explains that “As tangible assets, they [stamps] present investors with one way to beat financial repression; the low interest rates, money printing and silent currency wars that our central banks are resorting to in order to stimulate the economy.”
Irish art agent William Hanbury-Tenison outlined this process. He claims that government-provided stimulus was the cause of the massive rise in stamp prices. Chinese banks were directed by bureaucrats to approve loans. He stated that “business people paid commissions to bankers or go-betweens to get loans and you get enormous amounts of money in the hands of an elite who could broker distributions of liquidity. They spent it on luxuries.”
The tightening grip by the Chinese Government to responsibly manage money has caused the plateauing of high end stamp prices around the world.
The Stamp Market Will Rise Again
If you love stamp collecting, then you’ll be happy to hear that the market will most likely rise again. Head of investment at Stanley Gibbons’ Keith Heddle stated that “you seem to get ten year cycles and you do get rises, then a few years of flattening, and then the prices rise rapidly again.” With a number of emerging economies around the world you never know if another record rise in prices is just around the corner.
About the Author
Evan is an avid stamp collector and runs USA Stamp Guide as a hobby. The site helps you find close places to buy current postage stamps as well as a breakdown of buying stamps in different states throughout the country.
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