It only holds true as long as there is a purchaser for an instrument at a price that merits buying it and holding onto it.
Of course, each of us has a different point at which we have to say "I can't be tying this much money up for this long with no certainty that I will get a return on my 'investment'." For many, this point is well out of reach (i.e., they don't have enough money to get into the door in the first place). But, once that threshold is past, you then have to have the market functioning whenever you wish to "cash out" your investment.
And, I submit, with the market largely being driven by musicians (many of who are marginally employed in the best of times), when things go south there are going to be fewer and fewer around to pay the kind of price that will allow those who are in it for "investment" purposes to sell.
There's also the scarcity issue working here. Ain't no new Mark VIs being created, which functions to make the "investment" angle a bit more workable. But, the lack of income for musicians probably balances that side out.
However, it's not the worst example of this sort of behavior. Take Beanie Babies, the little stuffed animals that became something of a "craze" over here starting in the early 1990's. There, the combination of a mass produced (but restricted availability) item with "hype" caused a massive over-investment in something that had absolutely no real "worth" (i.e., none of them were being used as toys).
When they cost $3.99 (or whatever) and were bought as toys, there was no real problem. When certain "rare" toys were bid up to the stratosphere by folks viewing them as a form of lottery, the problems started. The very sort of people who are the target market for lottery tickets threw the rent money and amassed "collections" that were built with the intent of cashing in.
Watching the Classified ads (in search of saxophones) allowed me to track this phenomenon pretty closely. During the height of the craze, prices offered for certain toys would slowly creep up, while prices for sale of these same toys (listed by name) would creep downward until they reached equilibrium. However, when the crash came (along about 1999), the reverse was true: offered prices moved down in a hurry, and for sale followed, relentlessly. Priceless...except for those who had "invested" their rent money in the "hobby".
All shades of the "tulip craze" in The United Provinces of the Netherlands, which peaked and crashed in 1637 (or not, depending upon which account you read), and my old pal John Law and his financial scheming.
Well, not quite. John Law's operation was based upon fantasy, just like Bernie Madoff's recent scheme. At least with tulips, Beanie Babies and Mark VI saxophones, you still have the speculative item in hand. If you are a flower lover, a small child, or a saxophone player, there is your residual value. (A similar case can be made for the wardrobe investor.)
And, none of this means that I haven't enjoyed the resale value of a Mark VI in the past. I have owned five such horns (my original set of SATB, all bought when they were "affordable", plus a tenor from the "good years" that my wife blundered into via the Classified ads in a small town paper), and I have sold each of them for what seemed like obscene amounts of money, this to put the money to what seemed like better purposes at the time.
But, I'd never put anything in a musical instrument that I wasn't willing to kiss goodbye for good, i.e. they are something with which I could do without if they were to vaporize and the insurance were not to make good upon their loss.
Of course, each of us has a different point at which we have to say "I can't be tying this much money up for this long with no certainty that I will get a return on my 'investment'." For many, this point is well out of reach (i.e., they don't have enough money to get into the door in the first place). But, once that threshold is past, you then have to have the market functioning whenever you wish to "cash out" your investment.
And, I submit, with the market largely being driven by musicians (many of who are marginally employed in the best of times), when things go south there are going to be fewer and fewer around to pay the kind of price that will allow those who are in it for "investment" purposes to sell.
There's also the scarcity issue working here. Ain't no new Mark VIs being created, which functions to make the "investment" angle a bit more workable. But, the lack of income for musicians probably balances that side out.
However, it's not the worst example of this sort of behavior. Take Beanie Babies, the little stuffed animals that became something of a "craze" over here starting in the early 1990's. There, the combination of a mass produced (but restricted availability) item with "hype" caused a massive over-investment in something that had absolutely no real "worth" (i.e., none of them were being used as toys).
When they cost $3.99 (or whatever) and were bought as toys, there was no real problem. When certain "rare" toys were bid up to the stratosphere by folks viewing them as a form of lottery, the problems started. The very sort of people who are the target market for lottery tickets threw the rent money and amassed "collections" that were built with the intent of cashing in.
Watching the Classified ads (in search of saxophones) allowed me to track this phenomenon pretty closely. During the height of the craze, prices offered for certain toys would slowly creep up, while prices for sale of these same toys (listed by name) would creep downward until they reached equilibrium. However, when the crash came (along about 1999), the reverse was true: offered prices moved down in a hurry, and for sale followed, relentlessly. Priceless...except for those who had "invested" their rent money in the "hobby".
All shades of the "tulip craze" in The United Provinces of the Netherlands, which peaked and crashed in 1637 (or not, depending upon which account you read), and my old pal John Law and his financial scheming.
Well, not quite. John Law's operation was based upon fantasy, just like Bernie Madoff's recent scheme. At least with tulips, Beanie Babies and Mark VI saxophones, you still have the speculative item in hand. If you are a flower lover, a small child, or a saxophone player, there is your residual value. (A similar case can be made for the wardrobe investor.)
And, none of this means that I haven't enjoyed the resale value of a Mark VI in the past. I have owned five such horns (my original set of SATB, all bought when they were "affordable", plus a tenor from the "good years" that my wife blundered into via the Classified ads in a small town paper), and I have sold each of them for what seemed like obscene amounts of money, this to put the money to what seemed like better purposes at the time.
But, I'd never put anything in a musical instrument that I wasn't willing to kiss goodbye for good, i.e. they are something with which I could do without if they were to vaporize and the insurance were not to make good upon their loss.