What's going on with the used audio gear market?

Some humorous insight into our Audiogon community is on full display. Here are a few facts:

• The recent supply chain hiccups created shortages, real and imagined.
• Tube supply disruptions triggered price and availability spikes.
• The average joe began to hoard things (toilet paper and tubes LOL).
• People who could willingly paid higher prices for both new and used items in order to receive them in a timeframe that met their goals.

No greed there…just normal human behavior to an economic situation. Greed can’t happen for a non-essential item, only opportunism, which is what it is.

Historically, over decades in our hobby, summer and late summer has always been slow for sales as people are typically more active outdoors and with other normal pastimes like hiking, biking, golf and ballgames of all kinds. In addition, for the first time since pre-pandemic, there was a real vacation season and a real back to school window where audio rightly took a backseat.

Things typically pick up in the fall/holiday season (for certain gear) and then late winter/early spring there always seems to be a bump I guess due to some who purchase utilizing tax refunds.

I read the same old arguments here each year: our hobby is dying, prices are too high, these high prices charged in the high end will end the hobby, Mofi hurt my feelings, tubes suck, tubes rule, digital sucks, analog sucks, young people don’t get it, I miss the good old days when Ike was prez, foreign made gear is evil, the economy is in the tank, rap isn’t music, and on and on….maybe if the gear you are trying to sell isnt selling…maybe it isnt desirable at the price you are asking. Since when is that a new thing? Maybe if something is listed for sale at a price you think is too high and greedy and it still sells…maybe you are the one who is incorrectly evaluating the pricing landscape.

I get it, you want what you want for the amount you want. I think there is an old song from the ditant past that goes something like “You cant always get what you want”.

@grannyring

@ghasley Good post and it also made me laugh! This summer is also slower than past summers based on my selling experience which is vast 🤓. Confidence level in the economy, stock market losses and slowing housing market all impacting buyer behavior.

Hi Bill. You touch on the surface of a complicated topic: consumer behavior in general and ‘the wealth effect” in particular. Since I am pretty fiscally conservative and “not as young as I used to be” the audio hobby pricing model doesnt seem to deviate significantly from any other consumer driven segment. You and I (and many others on Audiogon) may be old enough to remember a fair number of economic slow-downs and spikes through the years. They each behave similarly, humans are quite predictable when the law of large numbers kicks in.

If they are fortunate to have savings (be they accessible invested savings or deferred savings like IRA’s or 401k’s) and if they are fortunate to be participating in the dream of home ownership, the rises and dips in these values do tend to affect spending behavior but I’ve never quite understood the irrational break from the reality that paper gains on items you don’t plan to sell to recognize said gains aren’t gains at all. Also, the dependence on debt (especially on depreciable/declining assets like cars or other consumer goods) that many untilize to fund a standard of living is pure folly but hey, no one asked me.

Audio gear used to depreciate (much like cars/boats/campers/motorcycles/toys) a great deal immediately and then settled into a predictable decline curve thereafter. The past several years broke with that natural trend but things have a way of returning to a long term trend unless supplies remain permanently imbalanced. I’m a believer in the money value of time in addition to the time value of money. When its time to sell, I put it out there at a price it will sell and I don’t worry too much about the trends….its worth what its worth today.

I do worry though when I see that unemployment is at record lows and yet, many believe the economy is “in trouble”. I worry when I see the headlines that the average car loan is financed for almost 6 years. The average payment is also at an all time high. Obviously if those are the averages, some are longer and for more money than others and this is happening in the midst of record low interest rates. We have a segment of the population that believes 5% cost of borrowing is outrageous… reminds me of those times where I might be in a casino and there is a line at the ATM machine where they are taking money out from multiple cards to play when they shouldn’t even be there. I’m fortunate to still be working, to carry no debt, to have sufficient liquid savings, to have sufficient long term investments and more importantly, everything is balanced and much of it hedged for good times and bad. I know its old fashined but I sleep well and dont have to check the markets every five minutes.

I shake my head though when I read a classified ad where someone is selling something and their reason for selling is “downsizing due to (pick one) unforseen expenses, kid starting college, divorce, downpayment for a house purchase, starting a business, to pay bills..etc, etc. Audio gear purchases shouldn’t have preceded preparation for the aforemnetioned. This used to be and should still be a discretionary purchase made with excess funds. If someone has a car loan as mentioned earlier should they have purchased a pair of Wilson Sashas or a DCS stack just because they had room on their third credit card? To each his/her own I guess…heck, maybe I should have had more “borrowed” fun earlier in my adult life but that isn’t how I’m built. With parents who came through the depression and WWII that just wasn’t going to happen. Easy access to credit is both a gift and a curse, depending on the person.

Rant over…until the next time LOL.

@bassdude 

Respectfully, you are making a circular argument.

When were prices last “fair” in your estimation? Government policy and dock worker practices? Did you sell your car because you were ready to sell or were you selling to monetize and maximize value? Every human is either a beneficiary or a victim of the effects of inflation. Most of us are beneficiaries provided we understand what is a good store of wealth and what is not.

There has been inflation since the beginning of time. Inflation doesn’t cause prices to rise, inflation is the measure of the trailing rise in prices.

@bassdude

I certainly meant no offense and I apologize if my education doesn’t measure up to your standards. It has, however, served me well thus far.

You were discussing in your post, I believe, your angst with the expansion of the money supply and how it was the cause of inflation. Inflation (outside of an acceptable range) "might" possibly be at least partially due to consumer spending of those excess funds rather than increased savings. Excess demand, especially in an environment where an aspirational purchase is being contemplated, manifests itself into rising prices when the commodity is finite.

When was the last time you were comfortable with the amount of the money supply? At what point in history?

When were prices last “fair” in your estimation? Government policy and dock worker practices? Did you sell your car because you were ready to sell or were you selling to monetize and maximize value? Every human is either a beneficiary or a victim of the effects of inflation. Most of us are beneficiaries provided we understand what is a good store of wealth and what is not.

You certainly aren’t compelled to respond to the questions above although I’m always intellectually curious as to what makes others "tick".

And Milton Friedman is but one opinion, as is yours or mine.