When the world gets closer.

We help you see farther.

Sign up to our expressly international daily newsletter.

China

Turning Paper To Gold: Chinese Collectors Spark Postage Stamp Investment Boom

Collecting stamps (like gold) used to be banned in China. No longer -- and Chinese collectors and investors may be creating a postage-stamp bubble.

(Zeitfixierer)
(Zeitfixierer)

Fears over inflation have prompted more investors to stash their cash in tangible objects. Gold is an obvious choice, and prices of the precious metal have soared as a result. But gold isn't the only thing catching the eye of investors these days. Some wealthy people – particularly in China – are plunking down big bucks for far flimsier objects: postage stamps.

In China, collecting stamps was forbidden for a long time, as was buying gold. Not any more. Since the bans were lifted, more and more Chinese investors are buying both. For now, Chinese collectors are increasingly focused on Chinese stamps. "Demand is being met by Chinese dealers who buy up Chinese stamps in Europe and send them to China," says Gerd Bennewirtz, general manager of the brokerage firm SJB.

Prices are often not an issue. At a Swiss auction last November, a block of four Chinese stamps featuring an ape against a red background changed hands for 138,000 Swiss francs (115,000 euros). The catalogue estimate was 2,500 euros.

While that is an extreme case, what has become routine is for sales prices of Chinese stamps to double catalogue estimates – and that brings out the inner golddigger in many an investor. Experts warn of the danger of a bubble, however, and advise European collectors to sell their Chinese stamps.

Selling, however, is not investing. "Especially in times of crisis, stamps are a good way of reducing asset volatility," says Bennewirtz. Big spenders will be looking to find unique or very rare stamps, such as the 1847 blue Mauritius that a Singapore collector paid some 5 million euros for in 1993. But for smaller investors, interesting options exist for as little as 1,000 euros – like the 1849 Bavarian "Schwarze Einser" that presently costs anywhere between 1,000 and 3,000 euros.

Not a liquid market

Bennewirtz recommends that potential stamp collectors select a specific theme or historical period so that they can build up expertise in that area and start to be able to recognize the potential of any given stamp as an investment vehicle. "Investors on the stamp market should be knowledgeable when it comes to classification, condition, authentication, the market itself, how to keep stamps properly, and the relevant literature on the subject," he says.

But even if all that is respected, he says, collecting stamps is not entirely risk-free – for the simple reason that any increase in value is always only theoretical. The question is: will that value hold in a sales situation when the collector wants or needs to sell? Will there be people prepared to pay that price?

The stamp market is not a liquid market like the one in shares and bonds, when investors can sell when they want, even during crashes. Which is why, Bennewirtz advises, stamps should never be collected as pure investment: a good dose of genuine interest is needed to make it worthwhile.

*This is a digest item, not a direct translation.

Read the full story in German by Frank Stocker

Photo – Zeitfixierer

You've reached your monthly limit of free articles.
To read the full article, please subscribe.
Get unlimited access. Support Worldcrunch's unique mission:
  • Exclusive coverage from the world's top sources, in English for the first time.
  • Stories from the best international journalists.
  • Insights from the widest range of perspectives, languages and countries
Already a subscriber? Log in

When the world gets closer, we help you see farther

Sign up to our expressly international daily newsletter!
Society

The First Victims Of Sri Lanka's Economic Crisis: Pregnant Women

The country's worst economic crisis in decades has toppled the government and led to soaring prices. Pregnant women struggle to access essential supplies.

Kirushna Sutharshan separates a basket of wild greens she has gathered forher family’s lunch.

Vijayatharsiny Thinesh

INUVIL, SRI LANKA — At sunset, as her young son plays nearby and her husband has yet to return from work, Kirushna Sutharshan forages for edible plants near her home.

She bends carefully over her expanding belly — her second child is due in August — but ignores the discomfort. The prices of milk, eggs, spinach and other foods recommended for healthy pregnancies have tripled since January; the once-free iron supplements are no longer available at prenatal checkups at public hospitals; and she cannot afford vitamins at private pharmacies. Even Thriposha, a corn-based nutritional supplement usually distributed to pregnant women for free, is no longer available.

Keep reading...Show less

When the world gets closer, we help you see farther

Sign up to our expressly international daily newsletter!
You've reached your monthly limit of free articles.
To read the full article, please subscribe.
Get unlimited access. Support Worldcrunch's unique mission:
  • Exclusive coverage from the world's top sources, in English for the first time.
  • Stories from the best international journalists.
  • Insights from the widest range of perspectives, languages and countries
Already a subscriber? Log in
Writing contest - My pandemic story
THE LATEST
FOCUS
TRENDING TOPICS

Central to the tragic absurdity of this war is the question of language. Vladimir Putin has repeated that protecting ethnic Russians and the Russian-speaking populations of Ukraine was a driving motivation for his invasion.

Yet one month on, a quick look at the map shows that many of the worst-hit cities are those where Russian is the predominant language: Kharkiv, Odesa, Kherson.

Watch VideoShow less
MOST READ