Don’t worry, folks. I haven’t forgotten that I still need to review gold and artifact cards in Commander. That will happen next week because it isn’t as timely as what’s going on right now with Legacy.
My article last week generated a ton of discussion, which is exactly what I was hoping for. It didn’t hit the site until late on Friday, and there’s already 40+ interesting comments spanning everyone’s thoughts on what is probably the biggest piece of Magic financial news this year. After reading through them all, I decided that we should continue the discussion for a second straight column. Let’s get to the bottom of this, shall we? I am as eager as you to discover whether or not the Legacy price jump is sustainable.
No one is buying Force of Will and Wasteland for $50+ each- false
There was a decent amount of rumbling in the comments saying that the stores could charge what they wanted, but the market would bear out the truth: no one is willing to pay the new, absurd prices for these cards. After all, who would pay ~$60-$80 for cards that were ~$30-$40 in January?
The answer, it turns out, is lots of people.
You can claim that the “sold out” cards on Starcitycames and Channelfireball is just a way for them to add some kind of false scarcity to the market, but that doesn’t pass the smell test to me. Hoarding hundreds and hundreds of copies of a single card is really bad business. Unless you think every major Magic retailer is colluding, I would suspect that any of these sites would be happy to buy cards at $35 and sell them at $60 all day long.
You want to know why those cards are “sold out?” It’s because they’re sold out! The price increase has created a ‘run’ on Legacy staples, and tons of people who spent the last 6-7 months thinking about getting into the format have decided to buy in now before the price goes up even more.
Wasteland has gone up even further since last week – true
In my article that ran JUST LAST WEEK, I said the following, “…the people raising the prices aren’t stupid. If they try to push Wasteland to $80 next week, the backlash will be quite severe and people will start to abandon the format.”
As of this moment, Wasteland is still $50 on Channelfireball and $60 on Starcitygames. Both sites are willing to pay $35 each for your Wastelands right now.
…however, Troll and Toad is BUYING Wastelands for $60. And you can’t get one on eBay for under $80 at the moment.
So, uh, think on that for a moment. We’ll come back to it later.
Myth – the majority of people buying up Legacy staples are speculators
Some people believe that the Legacy price jump is due to people buying cards not to sell, but to speculate on.
If this is true, then the prices on these cards are much more likely to go down in the near future. If there are indeed people hoarding hundreds of copies of the same Legacy staple, then they will start to flood the market once the confidence level begins to fall. This could ‘crash’ a card like Wasteland back down to the $30 level as supply would greatly eclipses demand.
That said, I highly doubt this is the case. I have no raw data to prove it, but I am reasonably active in the MTG finance/speculation world, and I simply haven’t heard about this sort of behavior on a massive level. While I’m sure there are a few people hoarding copies of these cards, the average speculator just doesn’t have the capital to do it. Even if you bought 100 Wastelands at $30 each, that’s $3,000 you have tied up in one purchase! How many people have the resources, knowledge, foresight, and desire to do something like that? A few, surely, but not enough to affect the market on any real level.
If anything, the market is being buoyed by people who bought a few sets of staples in the hopes that they would get into the format. With the price increase, they might now feel that such a thing is impossible and will get out while the money is good. Will that be enough to drop the price? Time will tell.
This Legacy increase is Starcitygames/online retailer/MTG financial columnists’ way of doing the ol’ Pump and Dump – false
If you don’t know the phrase, the Pump and Dump is when a person, company, or brokerage buys low on a crummy stock and then saturates the market with praise, hoping that the price goes up in the short term and they can make a profit. Then the person running the operation sells all their stock, saturates the market, and leaves the other investors high and dry.
To accuse Starcitygames of this is very short sighted. After all, Legacy is the blue chip cornerstone of their business model. The reason they run Legacy opens each weekend is to increase ACTUAL demand for the staples of the format. Instead of pumping and dumping by inflating the format with false confidence, they’ve breathed life into the format in order to permanently increase their profits. It’s a lot more ethical than the Pump and Dump, and a lot more profitable, too.
If you somehow think that I or any other MTG finance guy has the power to inflate the price of a single card, much less a whole format, simply look at the price of my “Pick of the Week” each week before and after I announce it. You’ll notice that while I will occasionally pick well, there are plenty of cards I pick that don’t go up for days if at all. I simply don’t have that kind of power. Some of the pros do, but they have to back up their statements with results. And those results would have increased the price of the card anyway.
Card prices have gone up 70% since January, yet demand can’t have gone up 70% since January! Thus, we are in a bubble – false
This is an interesting claim, and it bears a deeper look.
In the stock market, prices are based solely on what people will buy your shares of stock at. There is an ‘actual price’ for each share of stock – the current price – and it shifts on a second-to-second basis.
Magic cards, on the other hand, have no ‘actual price.’ There’s the price any given store sells the cards for, the ‘trade value’ price two people agree on, the aggregate value of eBay sales, and a dozen other possible ways to determine the true value of a card. How much was a Treefolk Harbinger worth at PT: Amsterdam? How much was Uril, the Miststalker worth at PT: Honolulu? How much is the fast-declining Grave Titan worth right now?
More and more, people turn to the large retailers – Channelfireball and Starcitygames – to figure out what prices should be. This has no equivalent in stock terms, or in terms of other ‘expensive collectables’ in the past. There were no major online retailers for secondary market baseball cards in 1991, comic books in 1994, or Beanie Babies in 1998.
Wasteland was $30 for the past year, despite quickly rising numbers of Legacy players. Through it all, the large stores kept their Legacy staples rather stable, with most well-known cards not rising more than a couple bucks since the start of 2010.
To me, the price increase two weeks ago was a reflection of the past year of Legacy growth, not the past few months. The $30 Wasteland of January 2011 was the aberration, not the $60 Wasteland of today.
This price increase will kill Legacy – false
People have VERY short memories, it seems. Doesn’t anyone remember February and March of last year? There were articles every week on this site – some of them with over 200 comments – discussing the death of Legacy and how not overturning the reserve list will ruin one of Magic’s best formats.
Why was all of this discussion happening? Because Starcitygames massively increased the buy prices of many Legacy staples, especially dual lands, Tarmogoyf, and Force of Will. You can go back in the SCG archives and find pages and pages of Ben Bleiweiss talking about how Magic is more popular than ever and that is why the prices on everything have gotten really stupid.
Wizards even called in a counsel of players, collectors, and store owners to figure out what should be done about the reserve list and making Legacy more accessible. The result, I think, was the re-invention of Extended, which seems to have bombed horribly.
Needless to say, Legacy had its best year ever. The price increase caused a lot of grumbling, but that was all.
Remember – people last year were predicting $200 Underground Seas by January 2011. That obviously didn’t happen. My guess is that just like last year, the majority of Legacy cards will be stable for about a year…and then the prices will go up again, and the cycle will begin anew.
The price increase is based on nothing – false
I was asked in the comments why Starcitygames didn’t up the price on Force or Wasteland to $70, or $100, or $150 if they can basically set whatever price they wanted. This is worth looking into, because it gets down to the crux of the situation.
First, gradual change is much harder to notice than immediate change. That’s why it’s so easy to gain weight – you don’t notice a pound or two a month until one day you realize that you’ve gotten fat.
Second, assuming the change isn’t too terrible, people will get used to it after a while. You don’t bat an eye paying $3.50/gallon for gas, ($4+ now where I live…) even though it was $1/gallon in the late 90s.
However, what do you think would happen if gas went up to $8/gallon tomorrow? That’s not an unreasonable price, considering it’s about what people pay in Europe.
My guess is that there would be a massive wave of protests, a whole lot of media coverage, a demand that the president/congress act immediately, and a lot of attention paid on developing much more efficient cars.
Also, unless there was widespread collusion, some of the oil companies would start to lower their prices to beat competition. And eventually the price would get back down to whatever the market would bear.
Starcitygames does not have complete control of the market. They cannot decide that [card]Phylactery Lich[/card] is worth $50 because no one will pay that for a Phylactery Lich, even if they want the card for a deck.
They do, however, have an excellent idea about the demand for certain cards in Legacy. My guess is that they took a long look at cards that hundreds of people asked them about each weekend but they could not keep in stock and made an educated guess at how much they could get away with charging for them before the backlash got too strong. Then they raised the prices to those levels. If Troll and Toad is right about Wasteland, they may have even underestimated on some of them!
It only made sense for other sites to raise their prices as well. After all, even at the higher price, Starcitygames was doing brisk business selling those staples! If their prices were too high for the market to bear, Channelfireball, Troll and Toad, and all the rest would have made a huge deal about how their prices are massively lower than Starcitygames. After all, Starcitygames has a history of overpricing cards – ask anyone who was playing the game 5-6 years ago.
No – Starcitygames merely noticed that a certain section of cards were underpriced relative to demand. It made sense to begin charging more, and everyone else caught on immediately.
Wizards of the Coast will attempt to do something about this – True
If you follow Aaron Forsythe on Twitter, you already know that the long term viability of Legacy is very much on the WOTC radar.
Last week, he asked his followers – specifically those who own a full playset of duals – how they’d feel about “snow duals” being printed in order to give Legacy players a new option. He also asked people for suggestions on other, potentially cheaper formats that WOTC could sanction – perhaps not in lieu of Legacy, but as another viable constructed alternative to Standard.
My theory is that last year’s Extended reworking was an attempt at fixing this problem. Old Extended was vastly more intimidating to get into, and the idea behind the change was that people could basically build a standard deck and keep tweaking it for four years though the two formats.
If you watch LSV and TSG’s Magic TV, you’ll have already heard their thoughts on why this failed. By and large, I agree with them. The format is dominated by the undead corpses of Standard’s most hated decks, Faeries and Jund, which approximately no one wants to play against anymore. Events never fire on MTGO, no one has decks built, and it is really only a PTQ format. Since the format doesn’t play that much differently from Standard, there’s no reason not to play the year-round format with more articles, more available games, and more excitement behind it.
I think it also goes back to my point about demographics. Standard is a great format for those who like a metagame that shifts weekly, the chance to play new cards, and all the latest tech. Legacy is for those who love the old style of play, powerful interactions, and decks that never rotate.
So who is Extended for? What demo is it supposed to appeal to? Right now, it just appeals to those who play and enjoy other formats more. There just doesn’t seem to be much of a point to it right now.
Wizards will try something else – some other way to slow the Legacy price creep. It may be a new format that will appeal to more people (BYO Standard, anyone?) or a massive banning or FTV: Legacy. I don’t know what, but it’ll happen this year, and it WILL massively affect the prices of some Legacy staples that are currently shooting through the roof.
No one believes me on banning duals because there’s been no discussion on it, but it seems like an easy fix to me. While the Ravnica duals aren’t nearly as good, does any archetype really die if they ban the revised dual lands? Would this really make any of the mono-colored decks THAT much more powerful? WOTC wants to find a way to make the format cheaper without gutting it. Even though no one is talking about it, to me it’s a possible solution.
Force of Will has gone up even further since last week – True
Between writing the last paragraph and this one, Starcitygames just announced that they are buying Force of Will at $60. It is currently sold out on their site at $90.
Neither Force of Will nor Wasteland is on the reserved list – True
Please draw your own conclusions on this contentious issue, but for now these are mine:
Legacy, as a format, is not in trouble. It is not dying. 2011 will see more Legacy play than any year before.
If Wizards of the Coast doesn’t act, the market will show that enough people are willing to spend $80-$90 on Force of Will and Wasteland to keep the prices that high.
However, I believe that we will see a readily available Force of Will reprint this year. I would also bet we see yet another Wasteland reprint. This will drop the prices for both of these cards back down from the $90 range into the $40-$50 range.
Remember: Tarmogoyf was $100 a year ago. While that was mostly due to the Extended changes, eternal cards do come down in price sometimes.
I do not believe that another format will come along and replace Legacy.
I would make sure I had a playset of each of the following cards:
All of these cards are on the reserved list, and there is nothing Wizards can do to stop their prices from rising besides banning them from the format.
I think it is a very real possibility that the dual lands will be banned in Legacy. If you disagree, pick those up this year as well.
Keep your eyes on the VERY high-end Legacy cards: Tabernacle at Pendrell Vale, Moat, Candelabra of Tawnos, Grim Tutor, and Imperial Recruiter. If you see any of them start to creep up to dizzying heights, look out for the others.
Moat and Tabernacle are the safest bets. They are generally played as one-ofs, aren’t overpowered, and are on the reserve list. They could hit $400 easily.
The sky is the limit with Candelabra. If it keeps posting the results it has, though, I could see the very first Legacy banning based almost solely on financial reasons/card availability. If it costs $2,000 for a set of them and it’s the best deck in the format, Wizards WILL ban it for “power reasons” (wink wink).
Grim Tutor and Imperial Recruiter may finally be reprinted in some form.
What do you think? Am I way off base? While I am going to go back to Commander for next week’s article, I’d love to keep the Legacy discussion going in the forums.
Until next time –
– Chas Andres