Economic Recession and S&W values

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Oldengineer

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I’m trying to read the tea leaves. There are a number of Smiths I’d like to add to my modest collection. I’m concerned that the elevated prices that we are dealing with today will not be representative of what the market will be like should we slip into a recession. The takeaway is sell now, buy later. Any thoughts on this strategy?

8 months since I began this post. Are prices softening now in 2023 that some folks have felt the bite of inflation and layoffs?
 
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My opinion worth the price paid:

Smith & Wesson is now experiencing the collector interest once given to Colt. Many being priced out of the pony market have realized that Smith & Wesson is a viable alternative (Ruger to a lesser degree but moving up), and certain models have enjoyed an appreciation seemingly out of proportion to yesterday. Great condition and rare pieces are going to continue to rise. Pre lock blued steel is going to rule.

I have not seen any pause in the Colt market, and I don't expect any in Smith collecting.

If we slip into a recession there will be buyers with disposable income, and that will not change. I personally am far more concerned that inflation will drive prices further up than a recession taking them down.

If you are considering selling models in demand now - they will be in demand later. My crystal ball says you will never buy them back for what you turned them loose for.
 
There will always be a market for the (collectibles) aka pre-lock guns but with gas, food and anything else you can think of going up so much so quick, only certain individuals can afford to stay the course and others will be selling to make ends meet. I believe a buyers market is coming…
 
Prices for collectible pieces are likely to increase for the foreseeable future driven by inflation if nothing else. IMO the longer term risk is a change in collector interests and/or politics. How many young folks are buying collectible S&Ws now and how many will in ten years? I'd say buy the guns you like, enjoy them for what they are, but don't buy them as investments. The stock market has historically provided better returns and it appears we have, or are close to, some bargain prices on Wall Street. Good luck.

Jeff
SWCA #1457
 
I believe that it is the younger collectors who are driving the price up on pre lock but non P&R guns. The older collectors seem to show little interest in this era , but these are old guns to the younger guys
 
I also do not see the prices of S&W's coming down. Every one I would like to add to collection, in nice shape and good condition, you have to lay out some cash for. I agree buying for investment is not wise but searching around you can find good enough deals that you will not loose money on reselling. I always make sure, at least in my mind, that I can resell for what I have invested in a firearm. Sometimes it is not hard to convince myself. With the crew I shoot with we all tell each other it will be our kids selling them some day. We will not have to worry what the return is.
 
Travis Montana said:
With the crew I shoot with we all tell each other it will be our kids selling them some day. We will not have to worry what the return is.
Click to expand...

Yes, but have to hope they will be knowledgeable when the time comes and not give them away. Otherwise they'll become "deals" to some future collectors. Some of my best ones came after "gramps" or Dad passed and the kids dropped them off at the pawn shop for whatever was offered. Likely the original owners didn't expect their favorites to end up in a pawn shop.

I suspect many here have comparable experiences. Better I think, as the time draws closer, to identify a few keepers for the family and sell the rest keeping pictures and memories to admire.

Jeff
SWCA #1457
 
I suppose the one thing to remember is guns are not investments - they are stores of value. If you buy a Smith and Wesson model "X", and sell it in like condition ten years later you will be generally be returned the same dollar equivalent in ten years.

If you "make" anything on your collection you made your money when you bought it - e.g. underpriced.

The best thing about a store of value is you can go out and shoot it, have fun, and not feel guilty about enjoying your hobby.
 
burneyr said:
I suppose the one thing to remember is guns are not investments - they are stores of value. If you buy a Smith and Wesson model "X", and sell it in like condition ten years later you will be generally be returned the same dollar equivalent in ten years.

If you "make" anything on your collection you made your money when you bought it - e.g. underpriced.

The best thing about a store of value is you can go out and shoot it, have fun, and not feel guilty about enjoying your hobby.
Click to expand...

But with firearms you don’t have the risk of market crashes. Guns are always valuable in hard times and disasters.
 
Laketime said:
But with firearms you don’t have the risk of market crashes. Guns are always valuable in hard times and disasters.
Click to expand...

Not exactly the same equivalency-

If you "invested" in a Registered Magnum in 1939 you might get in the neighborhood of $4k-$12k today which beat inflation at 1.25k.

The same $60 invested in the S&P would be valued at 147k.

The "risk" with firearms is your opportunity cost...
 
Think you need to separate collecting and investing.

Personally, I collect what I like to have and enjoy. There are some high end items that I suppose could be considered investments, but they are also priced in the range where the community of collectors determines the value, not the overall economy.

When it comes to a gun, if it's anything common and in production right now, there is the possibility that several months down the road it will cost less that what you pay now, things are a little on the expensive side, but in the end the amounts we're talking about really are not that much.

FWIW, my SA Hellcat is back up to the price I paid in mid-2020 when guns were scarce, but was around $50 less a few months ago. Of course I bought the thing because I wanted one in my collection, the price swing really isn't that much, and I doubt the thing will ever have it's value go up enough to be an investment grade pistol, although I have had some things accidently become collectable over the years.
 
burneyr said:
Not exactly the same equivalency-

If you "invested" in a Registered Magnum in 1939 you might get in the neighborhood of $4k-$12k today which beat inflation at 1.25k.

The same $60 invested in the S&P would be valued at 147k.

The "risk" with firearms is your opportunity cost...
Click to expand...

Compare the two scenarios in the year 2009 and you needed cash fast .Guns may not make you rich but they are a safe bet
 
I am very fortunate enough to have a couple daughters and son-n-laws that research everything. I also made a list of what I paid for firearms, what they might be worth and ones to really look into. I know not all are going to make it to the for sale department. Although I have been a avid shooter and hunter for 55 plus years I have only been a member or forum for a short time compared to I consider some very good experts on site that have been here for years. One thing I did request is that items get listed here first and hopefully get picked up by someone that will enjoy them, and I mean shooting them, as I have.
 
Laketime said:
Compare the two scenarios in the year 2009 and you needed cash fast .Guns may not make you rich but they are a safe bet
Click to expand...

Exactly as I said and later demonstrated with my example - guns are a store of value. Market fluctuation does not alter that fact.

The safe bet as you say is the ability to return your value equivalent into the future which is the textbook store of value definition.

That does not make guns an investment. If there is a need to liquidate for fast cash that is a failure of planning, not of market forces.
 
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