I was lucky enough to start learning the antiques and collectibles trade in my teenage years. This was back at a time when the modern era collectibles trade was entrenched in several prominent speculative bubbles. I fondly remember trading pack fresh baseball cards on the school playground when I was in grade school. Back then, we were sure the value of those cards would continue to go up and up, and we would all be driving exotic European cars just with the profits we made from selling them. Sadly, and rather quickly I may add, the bubble ended, and I got my first taste of what happens when a speculative bubble goes pop. It was from this experience that I set out to learn how this happened. Unfortunately for me, around this same time, modern era comic books were also considered to be a sure-fire investment with the rise in popularity of Tim Burtons newest comic book movie, Batman. When Batman stormed into theaters in 1989, it brought with it massive interest in modern era comic books. Companies like Marvel, DC, Image, and many others were all too eager to take advantage of this surge in popularity. By the early 1990s, the writing was already on the wall that this too was a massive speculative bubble, and I again learned another valuable lesson. It is at this point that I would love to tell you this was the final lesson I needed to learn, but fate had other plans. By 1994, the world turned their attention to cute deformed under-stuffed childrens toys known as Beanie Babies. Luckily, I was armed with the knowledge I gained from several key people in the antiques and collectibles trade who taught me why my baseball cards and comic books from the late 1980s and 90s would most likely never be worth much. Most of the collectible world went mad for these little stuffed critters! During these formidable years, I finally learned why no one company can ever manufacture a true organic collectible and have it hold value over the long term. The modern era collectibles trade has come a long way since the rise of Beanie Babies. Modern era sports cards manufacturers learned their lesson from what is now known as the junk wax era. This was a forgettable period in the sports card hobby during which manufacturers of all types produced so many cards that many are still available to buy today by the case for pennies on the dollar. Today, the world of sports cards is dominated by just a few prominent companies, and they learned from these mistakes of yesteryear. Manufactured scarcity is now the anecdote to overproduction. This is where a manufacturer of a modern era baseball card may create a single unique card and have it autographed by the player, then randomly place it in blind packs of trading cards. When the lucky purchaser opens the pack and finds a card like this, he or she can usually sell it on the secondary market for an extremely high market price because it is truly a one-of-a-kind collectible. Sports cards manufacturers have been using this gimmick for decades now, and with the rise of third-party card grading services, it has been a boon for the industry. The concept of mass-produced scarcity is not limited to just trading cards though. Toy manufacturers have long sought to produce limited-edition chase products that require consumers to jump through hoops to be able to get the item in question at retail or pay an increased markup on the secondary market. One such company that helped facilitate a massive speculative craze for their products was Funko. Funko was a novelty toy company that was founded in 1998 but hit worldwide success later with its Funko Pop line. Funko Pops are vinyl toy figurines with an oversized head that are based on popular characters from various pop culture franchises. There are Funko Pops based on Star Wars, obscure television shows, video games, Pokemon, and even comic book characters. Funko Pops first came on the scene in 2010, and unfortunately to a new generation of consumers who apparently didnt study what happened to the secondary market values of Beanie Babies or PEZ dispensers, they managed to capture diehard fans. As anyone who works in corporate America will tell, everyone knows that millennial-age coworker who never has money for lunch, but has a cubicle filled with factory-sealed Funko Pops that were never taken out of their original packaging. By 2012, the company strategically started to release limited-edition chase Pops that had production runs in the low thousands. Smart speculators in this market sought to quickly flip these items into the secondary market while starry-eyed speculators and Pop lovers would pay a substantial premium to get them. And over the next few years, this worked well. However, by the time the pandemic hit, the company made some bad business decisions and started overproducing product to appease Wall Street (Funko is a publicly traded company). By 2022, the company announced plans to destroy a portion of their inventory due to a lack of sales. The writing was on the wall, and consumers were tiring of the deformed vinyl figurines that can still be seen on clearance at major retailers today. According to the companys most recent SEC filings, Funko is in trouble. With about $241 million in debt and declining sales, the company has said they may not last another year. Incidentally, Ty, makers of Beanie Babies, are still in business turning out new products. So what exactly went wrong here? For starters, you cant manufacture a collectible. The closest we can come to this is what current sports cards manufacturers are doing by creating one-of-a-kind unique autographed cards, and even that is inherently risky. Another issue Funko had is not understanding that one day consumers would tire of their product. Funko Pops were not innovative like a Lego set that has multiple uses and can be appreciated and experienced by multiple generations. Funko Pops just sat there, remained factory sealed, and took up space until they could one day be resold for a profit. I have written about Funko Pops extensively before, and one argument that I keep encountering with the pro-Funko Pop crowd is that they are based on popular licensed franchises and have unlimited appeal as a result. The problem with this thinking is that we have seen this play out before with PEZ, and if you look at the values of even vintage PEZ dispensers, you will see for the most part, they cost the same as they did in the 1990s. Its a dead collectible. My advice for anyone wanting to know why items like this make bad long-term investments is to do what I did and learn from this experience. Who knows, you might just find a passion and career in one of the greatest businesses ever, the antiques and collectibles trade! Always remember that knowledge combined with an open mind equals power! Shawn Surmick has been an avid collector since the age of 12. He currently resides in his hometown of Boyertown, Pa., and is a passionate collector of antiques and collectibles. His articles focus on various topics affecting the marketplace.