13
When dealing with collectibles, the ultimate question is: When is the right time to sell? Has the market peaked?
Nobody wants to cash out, only to find out later if they’d only held on, they’d be rolling in the clover.
If I only knew!
The laws of economics say that all markets and values are based on supply and demand. Simple, right? When the demand exceeds the supply, the value goes up. If there are ten thousand of something and a million people want one, the price goes up. If there is only one of something and nobody cares, there is little value. This applies to guitars even more so.
Over the years, I have sold so many guitars thinking that I did really well at that time, and for that time I did do well. But relative to the price of those exact guitars today, I blew it.
I have a split personality. The businessman in me says, “Don’t be the last person holding the bag.” The collector in me says, “I love this object and will never let it go!”
In almost every instance that I sold before a peak, I had good reason. Maybe I had to remodel a house, buy a car, diversify some investments. Everything seemed to make sense at the time. Still, I could write an encyclopedia of the guitars I sold that have gone up fiftyfold in value.
Growing up listening to the Beatles, Bob Dylan, James Brown, great jazz artists like Wes Montgomery, George Benson, Django Reinhardt, and great blues artists like Albert King, B.B. King, Little Milton, and Little Beaver (in Miami) has been a crucial part of my life experience. The models that these artists played have meaning to me and all guitar players around the world. In the back of our minds is the thought, “If I only had that specific guitar, maybe I could sound like that!” And then we pursue our version of that sound. That’s what it’s all about.
Guitars are emotional things for me. They’re one of the things America did right. I’m in love with their playability, feel, mojo, whatever you might want to call it. These instruments make music, and music has been a continuous source of inspiration to me.
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My old friend Jim Weider loves to check in with me by phone a couple times a year. As time goes on, we talk about our kids and our various age-related ailments, just feeling good to be connected. He always ends the conversation with, “I’m lovin’ that 1953, Norm. Thanks mucho.”
Ugh. He’s referring to the 1953 Blackguard Tele I sold to him for $350. Granted it was the early seventies, and at the time I thought I did very well. Three hundred and fifty dollars was a lot of dough back then!
Like I mentioned in a previous chapter, I sold late-1950s Sunburst Les Pauls for $1,500 to $5,000 a piece. Each time I thought I did great, only to later find out that I jumped the gun in the worst possible way.
You can’t live with regrets, but when I think about those fourteen Sunburst Les Pauls I sold, because I got “cold feet.” At the least I have provided wonderful investments to a lot of people. Many of my customers have made a lot of money by holding on to their guitars, and one day they may thank me, LOL.
The greatest story about selling at the peak of the market involves my friend Bob Turner in Phoenix, Arizona. Bob started dealing vintage guitars at a very young age, as a teenager. He was a visionary. One day, Bob was trolling the ads in the newspaper in Phoenix, Arizona, and he spotted a Gibson SG Special. He tracked down the guitar, saw it was very clean, and made the deal, happy with his purchase.
While driving home with the SG, Bob passed through an area of town that would later get developed. There were a few run-down older houses there, and as Bob drove by this one house, he saw a young man standing in front of a house playing a guitar. He was driving by quite fast but made a quick about-face, turning around to see what this kid was playing.
It was an odd-looking instrument, very angular. Kind of like those crazy heavy metal guitars the Japanese would later develop.
The year was 1971. The Ibanez guitar company didn’t even exist. Bob stopped at the house and saw the kid was playing a guitar that looked pretty interesting—as in Gibson Explorer interesting. Hardly anybody knew about the legendary, ultra rare Explorer, but Bob had incredible instincts, and he knew that this could be one of them.
Bob started a conversation with this kid about guitars in general. After taking a closer look, Bob quickly realized this was indeed an original 1958 Explorer. This must have been one of the ones that were shipped in 1963. This one had unusual features; it had a black pickguard and a short maestro vibrato unit. Bob wanted to buy the guitar from this young man, but he had spent all his cash on the SG.
So, Bob figured he’d use whatever bait he had on him. He pulled out the SG and flashed it at the young man. The kid’s eyes lit up, and he asked if he could try it.
“Sure,” Bob said. The kid took it and started noodling some Clapton licks.
The kid said, “This guitar plays great! Would you consider trading me for my guitar?”
Gibson 1958 Explorer. (Photo by Bob Turner)
Bob tried to control his enthusiasm and said, “Well, I guess so.” They made the trade, and I’ve included the photo of Bob with the guitar in front of that house, all those years ago.
Bob is sixty-three now and is hardly recognizable as the teenager in the photo. (As am I, as you can see in the other photos in the book.) The more I think about it, it just seems damn impossible to imagine. There was actually a time when you could stumble across someone playing an original Explorer in his front yard and trade a P-90-equipped SG for it!
The story isn’t over. You know what’s coming next. After a few years, Bob sold the guitar for a few thousand dollars. This seemed like a killing at the time.
Except for the fact that these guitars now go for up to a half-million dollars or more!
We now come back to the original question. What was more stupid, the kid’s trading the guitar for the SG, or Bob’s selling it for only a few thousand dollars? This is the dilemma faced by all guitar dealers and collectors. When is the right time to sell?
After talking with Bob, we both agreed on the answer. We have no regrets. We have led wonderful lives and have had a lot of fun doing this. It has been an honor to have owned these great instruments, even temporarily. We sold them at a time that we felt was right, and now someone else can carry the burden of trying to guess when the guitar market will peak.
Bob is one of the early pioneers of the vintage guitar business. Like myself, Bob has been buying and selling vintage guitars since the late sixties. There are many Bob Turner stories. Many of the stories are legendary. Bob has always been quite a character, and this is one of my favorite remembrances.
One day, a young man came into Bob’s store and sold him an inexpensive Rickenbacker solidbody guitar. I believe it was either a Ryder or an Electro. These were subsidiaries of Rickenbackers, their lower-end models.
Bob at the time paid the young man $400 for the guitar. A few weeks later the young man arrived back at Bob’s store asking if he could buy back his guitar. Bob said, “Sure, I’ll sell it back to you for $500.” This was a small and very reasonable profit for Bob’s $400 investment.
The young man replied, “I would like to buy the guitar back for $400.”
Bob said, “Look, I’m willing to sell it back to you for a minimal profit, but I feel I’m entitled to make something on the guitar.”
The young man once again replied, “I would like to buy it back for $400.”
Bob said, “Well, then what’s in it for me? You’re not being reasonable!”
The young man, getting a little angry, said, “No, I want it back for what I sold it for!”
Bob said, “All right, I’ll sell it back to you for $450.”
The young man once again insisted, “I want it back for the amount I sold it for.”
This conversation kept going on, and Bob said, “Okay, come with me behind the store.” Bob put the guitar on the step behind the store, pulled out his .45, and blew the guitar to bits. He said, “Now you can have it for nothing.” I guess that’s one way to end a conversation!
Everybody that knows Bob has stories about him. He’s definitely an unusual character, but he is one of my oldest guitar buddies. He can be an acquired taste, but you can’t help but love the guy.
•••
The businessman in me often buys back guitars I once sold, for much higher prices, because it’s a new business opportunity. I have had many customers turn tremendous profits selling me back guitars that I once sold to them.
I have sold Sunburst 1950s Les Paul Standards for $2,500, buying them back ten years later for $25,000, then reselling and re-brokering them for six-figure sums. The same has been true for high-end flat-top acoustics. I once brokered one of the finest Martin prewar D-45s for $7,500. At the time the $7,500 seemed like huge money. The buyer later resold the guitar for over twenty times his investment. I have to look at each deal as a new opportunity.
The market is influenced by many factors. Because the vintage guitar market is an international phenomenon, exchange rates greatly influence prices and demand. When the dollar is weak against foreign currency, it becomes a terrific bargain to buy American goods. At times, instruments were purchased for sixty or seventy cents on the dollar.
The Japanese market is a good case in point. The Japanese have been greatly influenced by American music and musicians. They quickly realized American-made guitars were extremely well made. As prices escalated, they wanted to get in on the action. Japan was the first country outside the United States to recognize the investment opportunity in vintage guitars. When the exchange rates were favorable, these instruments were a great bargain.
Because my father brought the Brother Sewing Machine Corporation to the United States, we always had many Japanese friends, and I have always had a great affinity and respect for the Japanese people.
My store eventually became a must-stop for many Japanese tourists throughout the years. At times tour buses would pull up with loads of Japanese customers. When the exchange rate was favorable, there were times that we literally had to limit the amount of guitars these customers could purchase. I wanted to make sure we had enough quality stock for our next visitors.
When I first opened, I was selling pre-CBS Stratocasters for well under $1,000. Americans themselves were asleep, but the well informed Japanese buyers recognized opportunity.
It can be cyclical. I ended up repurchasing many guitars that I sold to Japanese buyers over the years, for which they made nice profits. I was happy to have the instruments back on our shores.
•••
The market is constantly evolving. At one time, beautiful dot neck ES-335s from 1959 went for $1,800, which seemed like a lot of money.
Shortly thereafter, these guitars became the model of choice to Lee Ritenour, Larry Carlton, Jay Graydon, and many other top studio musicians. The prices quickly escalated, and about three months after I sold a beautiful 1959 for $1,800, I purchased a lesser example for $3,000. What else could I do?
It was an opportunity to make money, and I had to bite the bullet. I had to pay $3,000 for a guitar that I could easily sell for $4,000. That’s just the nature of the business. You have to go with the flow and pay legitimate and timely prices for guitars that can easily be resold for more.
Prior to 2008, there really was no time that values had declined across the board. But 2008 was a wake-up call, and many values were realigned. Don’t forget, real estate, antiques, and everything was hit pretty hard. Since then, however, values have begun to go up again at a rapid pace.
Recently I had the opportunity to buy back part of a big collection of guitars that I sold about twenty-five years ago. These guitars were super high end and primarily acoustic. Some were fantastic examples of early Martin flat-tops. Many of the models were Brazilian Rosewood style 28s to 45s. I paid many times what I had previously sold them for but was happy to buy them back, knowing that it was unlikely that I’d lose money on them.
Many people might feel funny about paying so much more for instruments they already owned, but I look at it as a new and fresh opportunity each time. I love having them back in the store, even if only temporarily.
•••
In the end, we’re all just custodians of these things. I believe fine vintage guitars will outlive many generations, and will be sold and resold throughout every corner of the globe. It has to do with their classic beauty and functionality of design, as well as utility. Functional art that’s made to be played.
•••
I just received a phone call letting me know that my old friend Bob Turner just passed away in September 2015. Bob was a pioneer in the vintage guitar business, and he will be greatly missed. He was truly one of the most unforgettable characters I have ever met.