Steve Duke presents Tradio Gems (Excerpts from Tradio)
Philately: Stamp Collecting

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Steve Duke:
We normally talk about all kinds of topics and things like that. Usually it has something to do with what I looked at in the shop during the week, over at Westchester Gold & Diamonds. I don’t know that we specialize in anything; we buy a little bit of everything. We were voted “The Place to Sell Your Gold and Diamonds” by Charlotte County. We buy those, we buy antiques, we buy collectibles. We buy coin collections and things like that.

If I said the word “philately” to you….

Ken Lovejoy:
Sir, this is a family show!

Steve:
I wouldn’t really be yelling at you. If I said to you, “Does this have to do with young children, bicycles, or stamps?” what do you think it would pertain to?

Ken:
“Philately?”

Steve:
Philately.

Ken:
Philately… I’d probably say stamps. Because, if I was you, I wouldn’t talk about young children. Bicycles, I don’t see you stacking a whole bunch of them up there….

Steve:
How about rare bicycles?

Ken:
Unless they’re $3,000, titanium bicycles…

Steve:
So you’re going with stamps?

Ken:
I would have to guess stamps.

Steve:
You would actually be right.

Ken:
Huh.

Steve:
A stamp collector is called a “philatelist.”

Ken:
Ah.

Steve:
Years ago, stamp collecting, or philately, was an extremely large hobby. As in any hobby, in any kind of collectible, there is stuff out there that is expensive, there is stuff out there that is less expensive, and there’s stuff out there that is just collectible.

Back in the 1930’s, FDR was a stamp collector. He was confined to a wheelchair. Along with his buddy, James Farley, who was the Postmaster at the time, he really pushed this type of hobby, for a couple of different reasons. Number one, FDR himself was a collector, and the more stamps that were out there, the bigger his collection could become!

He also realized that people who collect stamps are going to buy those from the Post Office. They’re going to spend that money to buy these stamps that are going to do nothing other than sit in books. So, this is found revenue, because even though they bought the stamps, they’re not moving the mail. This is free money!

It worked pretty well. James Farley turned around and he put out all kinds of special editions, special issues, et cetera. What do I mean by “special editions” and things like that? Well, if you notice back in the 1960’s and 1970’s, there was a big resurgence of stamp collecting, because, again, the postmasters and powers-that-be realized, “This is found revenue!” The price of stamps was four cents; then it went up to six cents, and eight cents.

There were people who collected different types of stamps that came out. So, the more reasons they could give stamp collectors to collect multiple stamps, the better it was. Now, back in the 1930’s, they had what we call “souvenir sheets” and “special issues.” They came out with what they called the “National Parks Issue” and it featured most of the famous parks in the United States: Yosemite, Zion, a lot of different parks.

It had one cent to ten cents stamps. Back then, in the 1940’s, the ten cent stamp really wasn’t used a whole lot. But it was found revenue, so if someone wanted to collect the Parks Issue, they had to have all the stamps – one, two, three, four all the way up to the nine and ten cent stamps. The nine and ten cent stamps were really found revenue, because they would never use it for postage, unless they had a big box.

What happened was the postmasters, et cetera, would not only put this set out in the normal type of issue. Around the edges of the stamp is what is called “perforations.” The perforations were put on stamps mainly because it’s easier to tear them and you can separate the stamps very easily. When stamps were first printed in the States, in 1847 by Ben Franklin, who was the first Postmaster, they were what we call “imperfect.”

They came out in a sheet of stamps with no holes between them, and you’d have to take a knife or scissors and cut those stamps apart. Some people were good at cutting between the lines, and some people weren’t. So, a lot of times you’d cut a part of another stamp and it would be on there. Tough break, you’d wasted your stamp.

With the perforations it was much easier for the general public to separate your stamps. They also had adhesive on the back that you could lick and then put the stamps on your envelope. The imperfect stamps didn’t come with adhesive; you had to put some sort of glue (usually horse hoof glue) on the back and then put them on your letters.

The post office found, “Ok, we made a set of stamps with perforations; let’s make a set of stamps that are imperfect.” Now, these stamps came out in full sheets with no holes between them. They were very decorative. Believe it or not, people turned around and put them in frames, and put them on their walls. Especially if you were a philatelist and you said, “This is the first time we’ve had imperfect stamps come back out in a lot of years, so I’m going to collect that whole set as imperfect sheets.” Sometimes they would put them in their books, or in their sheet albums, or sometimes they would turn around and frame them.

Not only were the sheets of ten cent stamps that nobody was going to use, but there were 50 of them on a sheet! That’s five bucks! Back in the 1940’s, that was a lot of money. It went to the Post Office, and the stamps were never used. We find that over the years the Postmasters came out with a lot of different varieties. Sometimes they came out with a sheet of miniature stamps, called a souvenir sheet, and people would put those in their albums.

Stamps were a great way to raise a lot of money for our country. It was a time when people were at a loss for things to do, around the Depression time. People were out of jobs; the frame of mind for the economy at that point in time wasn’t the greatest. FDR said, “You know, this is a great way to get the families to stay at home together, collecting stamps.” If they weren’t able to buy the new stamps, they could get the stamps off of letters and still put these stamps in their albums. It was a collectible thing that sort of bonded the country together. It was a great idea.

We find that after that people began to collect what we call “plate blocks.” If you look at the edge of stamps you’ll find little numbers. For each color a stamp would have, it would have to run through the presses in Washington. Each time it went through, a little number would be printed on the edge of that sheet of stamps. Originally, there was one plate block, because most of the stamps were one color. With the advancement in printing, we found that we could put multiple colors on stamps. Then sometimes you would have two plate block numbers. What did this mean?

The normal plate block was a block of four, with that single plate block number. Now, if it had two numbers, it might have a block of six, because the number would be in the middle. Later on in the 1970’s, they had multiple colors. There could be three, four, five, six, all the way up to eight, different colors on a stamp, with that many plate block numbers.

That meant people started saving half of a sheet of stamps, 25 stamps. Remember, every time they saved a stamp, it was never placed on an envelope, it never moved the mail; it was found revenue. The government realized, “This is a great way to do it!” Back in the 1970’s and 1980’s, they started putting out little booklets they could sell in the Post Offices for collectors, with one of each stamp that came out that year. People would go there and buy these little books of stamps, and then could turn around and put them in their albums. All these were actually ways to make money with stamps.

As we’ve talked about, with any kind of collectibles, why did people save stamps? Number one, they enjoyed it. It was a different time and a different place. People had the time; they didn’t have the Internet. We had books that we read!

Ken:
[Laughs]

Steve:
We sat there and actually read books at home, and we went to the library and checked books out of the library. Isn’t that a crazy idea any more? We didn’t have Kindles.

People would put these stamps in their albums, and they would enjoy them. They would look at it. As with any kind of collectible I’ve talked about, if you look at and it makes you smile, then by all means, enjoy it! Collect them. The more spaces people could fill up in an album, the more it felt like an accomplishment. “I filled another page up in my album!” A lot of people collected stamps.

The one thing you have to remember is that, as with most collectibles, there are different ways you can collect. You can collect them for fun. You can collect them as an investment; you can collect them because you believe they’ll be worth more money than you bought it for originally. We find the same things with stamps. I’m sure a lot of people out there are thinking, “What kind of nerd would collect little, colored pieces of paper and put them in a book and think that was fun and that they would ever be worth money?”

I started collecting stamps in Boy Scouts; it was a merit badge. I didn’t know a whole lot; I ran out there and bought a book, and packets of materials. If you looked in the back of different comic books and magazines, you could “Get 50 stamps from far away countries!” for a quarter or so. I got them, and I filled up that book as quickly as I could, and I called the merit badge counselor. He came over to the house, and looked at my book. Some of them I had put in there with tape, some I had glued in…

Ken:
[Laughs]

Steve:
All I knew was that I was going to fill up as many spaces as I could, scrape by, learn nothing at all, and get myself a merit badge. He opened up the book, looked at it, closed the book, and said, “Don’t call me and waste my time until you know what you’re doing with stamp collecting.”

I was devastated! “What do you mean? I filled up all these holes and stuff!” “No.” He asked me a couple questions; I looked like a deer in the headlights. I had no idea was the answer was.

I said, “Ok, thank you.” Well, then I got the book, and I started reading about stamp collecting. Back then it was a way to learn about history, and about current events. It was a way to make the world much smaller through knowledge. I said, “Geez, this is kind of cool, actually.” I started getting stamp catalogues, and looking up stamps, and learning about the different perforations (which was a time waster, but not really….)

Ken:
[Laughs]

Steve:
They would count the amount of perforations per inch, and what you would look at was whether it had 11 perforations in an inch or if it had 10, or 10.5. A lot of times they would experiment with the perforations in Washington to see what was the most economic. Back in 1910, when they did the Pan American series, they had a perforation of 11 and they had a perforation of 10. The perforation of 11 set sold at that time for about 5 or 6 bucks; the perforation of 10 sold for about 50 or 60 bucks. There were variations that made a huge difference on stamps.

There were things we call watermarks. When they were first made, the paper was laid out on screens to dry, and then it was printed on. Some of the screens had the letters “U S A” on them, some of them didn’t. Some of them were wavy screens, and some of them were straight. The difference just in the way the paper was made a difference of actually several thousands of dollars on the same particular stamp.

There were stamps done in 1863 that had different variations in the watermarks. This would be unheard of nowadays, but back then, you’d put use a little carbon tetrachloride. You’d get a little black ash tray, lay the stamp face-down in there, and add carbon tetrachloride, which would make it very wet. Then you could look at the back of the stamp and see the watermark on it. The carbon tetrachloride would evaporate, and you were fine again… if you came to from breathing the fumes! [Laughs]

Ken:
[Laughs]

Steve:
Because of the watermark alone, it could be a three-cent stamp used, it could be a thousand dollar stamp used, strictly because of what the watermark was. The government hadn’t really planned on that, but stamp collectors were in the frame of mind where they wanted all the different variations and realized some things, even back then, were particularly rare. Some things weren’t done that often, so people collected them.

When you brought that to the public’s attention, there was always somebody else out there who said, “I don’t have one of those in my collection; I’d like it in my collection. How much is it?” “Oh, this is $500.” So that person would buy it. Then somebody said, “I’d like to have one of those, but there aren’t very many around. How much is it?” He said, “It’s $1000!” Through auctions and private sales, the prices of a lot of these varieties escalated.

Some of the stamps weren’t particularly rare varieties; there wasn’t anything to worry about in the watermark, and the design was fairly common. We find back in the 1930’s, though, that the Post Office came out with an idea of a way to move the mail. In 1918 the first Air Mail stamp was printed; the mail was moved by airplanes rather than by ground.

In the 1930’s, with the advent of the Hindenburg, the Post Office said, “You know what? We could use dirigibles to move the mail!” The Grand Zeppelin and the Hindenburg and a couple of other different zeppelins were out there. The Post Office made a set of stamps; a 65 cent, a $1.30, and a $2.60 stamp. This was a lot of money during the Depression! Not a lot of people had the kind of money to buy this to move the mail. Even less people had that kind of money to buy the set of stamps to turn around and put it in their stamp albums.

The Post Office realized, “You know, this was probably not the greatest idea we’ve come up with. Rather than having these sheets lying around the different post offices, we’ll recall them and burn them, and it’ll be done. It was a screw up, whatever.” They also came out with a 50 cent stamp and said, “Some of the collectors can afford a 50 cent stamp – we’ll leave that.” That was the “Baby Zeppelin,” the name collectors gave it because it was a lower value and didn’t come out in the Grand Zeppelin series.

Well, all of a sudden, a lot of collectors realized, “There aren’t that many Zeppelin sets out here!” A lot of the stamp dealers said, “Thank you!” to the Post Office because they had just made a rarity; they destroyed what was left of the inventory. These stamps increased in value, and back in 1980, the first time gold ran up to $800, and the Hunt Brothers manipulated the market to $50 silver. There was super-inflation and everything was crazy, including collectibles; including stamp collecting.

That set of Zeppelins fluctuated anywhere from $800 to $1500, for a set of Grand Zeppelins. In 1980 they sold for $6000-$8000 for a gorgeous set! When I say a “gorgeous” set, how gorgeous can a set be? Here are some of the things collectors look for on stamps. Number one is centering; how nice are the margins around it? There’s a picture, there are perforations, and there’s a little bit of white space around. That should be beautiful and even. Other things collectors look for is whether the perforations are really nice, and whether the color on the stamps was nice. Another is whether the stamps were never “hinged,” or stuck to anything; they have “full gum” on the back of them.

If all those areas are good, that would be an excellent set of Grand Zeppelins. That set sold for $6000-$8000 in 1980. I remember saying to my father, “Hey, Pop! I have three sets of these Zeppelins, and they’re worth $8000 a set – what do you think I should do?” [Chuckles] Well, what do you think a smart father would say? “Sell ’em!”

But, being younger at that time, and realizing that “parents weren’t that intelligent” (as we think until we get older and find out they were pretty darn smart….) I said, “If they’re worth $8000 now- man, what are they going to be worth in 30 years!” 30 years later I find that they’re now worth $800-$1500!

Ken:
Nobody collects them.

Steve:
Nobody collects them. This is the problem with different hobbies and collectibles. A lot of them are cyclical; they go in cycles. People will collect, then stop collecting. Then another generation comes, and says, “Wow, this is pretty cool!” and they start to collect. Unfortunately, with philately, stamp collecting, there are less and less people who collect them. The amount of rarities out there are probably about the same, over a period of time, with catastrophes that happen.

China was a great place where a lot of collectors were; a lot of the high value, extremely rare collectible, stamps were in China. Through catastrophes that have happened, plenty of those stamps have been destroyed. A lot of the rarities have become even more rare. Unfortunately, the amount of collectors has also decreased. No matter how rare an item is, it’s only rare if there’s a market for it.

This past week I had a great collection of stamps come in the shop. The owners had a set of Grand Zeppelins; they had the issues from 1847, which is Ben Franklin and George Washington. They had some of the great, really high valued stamps, and we talked about it. The book value of that collection was probably $10,000 to $15,000. By the time we started grading them and looking at the condition and things like that, the catalogue value shrank from probably $10,000 down to about $5,000, because of condition.

What was the actual cash value? What would a dealer pay for it? I was a buyer at $2,000 on that collection, mainly because I still collect stamps for myself. Are they ever going to increase in value? I doubt it. When it’s time for me to sell those things, I don’t know that anybody will be around at that point who collects stamps! But, again, it gave me a feeling of accomplishment. I filled a couple of holes in my collection.

Ken:
All thanks to your Scout leader.

Steve:
Exactly. Thanks to the merit badge leader, I guess. I won’t say that over the years I certainly jumped in and became a stamp dealer; I had a huge inventory, and I made good money buying and selling stamp collections. Most of that got destroyed in Hurricane Charlie, when the ceiling fell in. Stamps don’t fare very well in rainy conditions when they’re out in the open.

But collectibles are worth what somebody is willing to pay for them. What somebody might be willing to pay for it could be a little more or a little bit less than what the next person is willing to pay for it. Again, it’s going to depend on supply and demand. The demand by philatelists for stamp collecting has gotten much, much smaller. I still have collections come in, and I still enjoy looking at them. I still buy some of them for myself.

There are different ways that people collect stamps; they can collect just plain stamps, they can collect “covers,” which would be a stamp attached to a particular envelope, like advertising envelopes. Then they can collect stamps can depending on where they were made, or by cancellations. That’s probably a topic I’ll talk about some other time. Believe it or not, it is kind of fascinating.

I’m Steve Duke, owner of Westchester Gold & Diamonds, talking today about stamp collecting: philately. If you’ve got stamp collections, we do buy them. We’re always happy to take a look at them. People say, “Do you guys know anybody who does stamps?” We do them. If you’d like to stop by and show us your stamp collections, we’d be more than happy to look at them. We’re in the Bear Plaza behind ABC liquors.

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