Economics 101: If I wouldn't buy it for what it will bring -- Shouldn't I sell it?

bushmaster1313

bushmaster1313

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If I own a firearm with no sentimental value, but if I did not own it I would not buy it for what I will bring -- shouldn't I sell it?

So how come my safe is full and I can't decide what to sell?

With most things it's not an issue, because most things that you have around the house would not bring anywhere near what it would cost to replace them.

On the other hand, online auctions have created a very effiecient market for the purchase and sale of firearms, and the question is always there, if I did not own that gun . . . would I buy it. If the answer is: "No," economics would say that the utility maximizing behaviour is to sell.
 
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Can you replace it and for how much?

Do you enjoy it? Doesn't need sentimental value to bring enjoyment.

Do you need the money?

I will probably never buy a Registered Magnum for "what it would bring" but if I owned one they would need to pry it from my cold dead hands... :D
 
Fishslayer said:
Can you replace it and for how much?

I will probably never buy a Registered Magnum for "what it would bring" but if I owned one they would need to pry it from my cold dead hands... :D
Click to expand...

That is exactly the point.

If you would not buy it knowing how much you would enjoy it, why would you keep it?
 
If you are only looking at the near term, the correct answer may be to sell.

However, firearms have a relatively unique property in that many continue to appreciate in value simply by sitting in your safe, often at a considerably higher rate than other currently available investments.

So perhaps you should forget that it is a firearm, and treat it as part of a stock portfolio.

Over the term that you might expect to hold it, would you get a bigger return by keeping it, or should you sell now and reinvest in another stock that would bring a bigger return, either in value or enjoyment? In the mean time, you get the 'dividend' of being able to take it out and play with it.

Just another way of looking at the economic equation. ;)
 
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I'm a hoarder.....no I won't sell it.:D


Seriously, I would buy most of mine again for what I paid for them. For the most part, this is considerably less than what they would sell for, but if sold, I couldn't replace them for what I paid for them, so in selling them, I really haven't gained anything.
 
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In the past 20 or so years I have purchased probably several hundred thousand dollars worth of stocks and bonds. I have purchased several thousand dollars worth of guns. The guns values have gone up more than the stocks.
 
The simple answer is yes. Rational (economic) decision making doesn't distinguish between income forgone by not selling and income given up by buying. The problem is that what were willing to pay or to forgo changes over time.

The idea is identical to the economic decision to sell a ticket whose scalp value exceeds its face value. If I paid $50 for a ticket and someone offers me $150 for it before the event, then the cost of me using the ticket is now $150, not $150. I forgo $150 if I choose to use the ticket. Now, I may still go to the event but now I have to consider the ticket costs me $150 instead of just $50.
 
Before I sell or trade off one of my firearms I ask myself how hard it be to replace what I'm selling. Once upon a time the gun I'm toying with selling was of enough interest I bought it. I might want another one sometime down the road. If it is common and easy to find another then it could go down the road.

If the gun is rare and it might be another lifetime before another one comes along then I'll weigh my decision more heavily. Things that might go into that decision might be how long has it been sitting in the safe, does it work into the rest of my collection, would it be better off a collection of someone else, does what I'm trading into have more potential for future profit, will it be something I'll use, etc.

I do have one hard solid rule...never sell something that goes bang to pay for something that doesn't go bang.
 
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The other half or the equation with selling a firearms is .......

Is this a tool I might need someday?

If I might need it someday ; will I be able to replace it....... easily and quickly, at a reasonable cost........ when I need it?

If the answers are yes...and no..... then unless you need the cash for an immediate "need" ....... you should not sell. Firearms do not depreciate at the same rate as other capitol investments....and generally appreciate over the long term.

From what I've seen here a nice RM is worth 100 times it's original $60 cost .... and often more!

A late 80's 3" 66 would bring 3-4 times the $270 I paid for mine.

Another thing I consider is: Is this a "tool" that I will give to one of my sons some day?

One last thought; in the 1980s I had at any given time, maybe 2-4 model 19s...... during the 1990s I sold/traded them for other firearms....... in about 2005 I realized I didn't have any 2.5" of 4" 19s or 66s ( my 19/66 needs were met by my 3" 66s)....... adding these tools back into my tool box took several years and each cost me 2-3 times those I bought in the 80s.
 
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Not just with guns but every item I own from a pen that wont write to my car or old rake in the garage I sometimes stumble over it and wonder to myself, how much did I pay for this, did I even ever use it, and if I didnt own it would I be looking to buy another? I am denying myself doing many things I would like to be doing at my late stage in life because I think I cant afford it, or have to preserve money for my much younger wife to live on when I check out. Then I look at the mountain of junk, around me and think what I paid for it, dont use it, and if it all was converted to money how I would live. I have sold next to nothing since I was born. Whatever I once had that I no longer own has been hauled to the dump or given to goodwill.
Through the years the only things I ever sold has been guns, cars and vehicles. This is the way a good investor thinks about his stocks, or is suppose to. That stock you are holding, would you buy it again right now today or if you had its value in your hand would you buy something else with it? My problem is I hang on to everything. I know I am dumb doing it but we survive but more cluttered and doing less.
I suppose smarter people than me might say you are letting your stuff own you!
 
several months ago I traded a rifle I was not shooting all that often for rifle I wanted and thought was cool. I miss the traded rifle and wish I hadn't traded. Now I am looking for a 44 mag lever action rifle. but my action did stimulate the under ground gun economy.
 
Take it from someone who continues to scale back ... if it collects dust as a piece of art, then turn it into something more practical and shootable (unless it has extremely high value).
 
Basic Law of Gun Inertia

1. Unfortunately with all the red tape and government controls selling a gun is a lot of trouble these days. So you have to be willing to spend the time and deal with the hassles of selling, which many people just do not do. If you were a business it would be right to sell, but from what you have written I don't think you are a business.

2. Even if you do not have a personal attachment to the gun, it may serve some purpose such as a truck gun, a gun you leave near your sleeping quarters, or a gun you don't mind carrying in your tackle box.

3. Also even if you could get a little more for what the gun is worth right now, it is difficult to replace it with something less expensive and of the same quality. This is because buying on line you pay shipping and FFL transfer. Buying locally you pay sales tax. These fees and taxes have to be added in to the purchase price of a replacement gun.

4. Good quality guns serve as one form of hedge against inflation, with more utility than hard currencies like gold or silver. The gun may well be worth more in 5 or 10 years than the cash you get from the sale would be in 5 or 10 years.

5. In a worst case scenario of SHTF, guns will be on of the most valuable commodities to trade, next to ammo.

6. Law of gun inertia states, "Guns at rest in a gun safe tend to remain at rest in a gun safe."
 
Assuming all my hunting, recreational shooting, and personal protection requirements are met...
If I found myself wondering about selling an "excess" gun for more than a few minutes, I would probably sell it.

Of course, if I was in a jam for cash, I might liquidate assets (guns included) that I would otherwise want to keep.
 
From the words of a hoarder. It's paid for it doesn't eat anything one day you may want it. If you don't need the money why sell just get a bigger safe.
 
Maybe living in NJ makes me feel this way but since handguns are such a pain to get here, I wouldn't sell any of them. I don't see the process getting any easier and there's a fair chance it will all end one day so for that reason, I'm holding on to each and every one.
 
mc5aw said:
Take it from someone who continues to scale back ... if it collects dust as a piece of art, then turn it into something more practical and shootable (unless it has extremely high value).
Click to expand...

I am taking this advice.

The gun in question is a very nice example of its genre, but it is not a valuable museum piece and it is not one of my favorite shooters.
 
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