Newsletter #33, April 2010: The Vintage Instrument Market

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This newsletter is a seven-part series on the vintage guitar market, written in 1991. Needless to say, prices today are significantly different than they were then and the market has gone through many gyrations since these presentations were written.

Although these articles discuss vintage instruments, many of these same instruments are today fully twice as old as they were at the time the articles were written. The customers I had at that time are now much older and a new generation of customers has emerged.

While today there are numerous books devoted to the subject of vintage instruments, at the time these articles were written there were only a handful. Today we take the Internet, websites, and e-mail for granted, but at the time these articles were written, while a few dealers had computers, no dealers had a website, information was not readily available via computer access, and people were not communicating via e-mail.

Hindsight is always much clearer than prognostication, but I still find it interesting and informative to look back upon my thoughts of years ago and especially to analyze and compare the predictions I made in the past with the actual later outcome.

Please feel free to email me with any comments.

George Gruhn

Introduction

In 28 years of collecting and dealing vintage fretted instruments, I have observed radical changes in the economy, in society, in musical trends, and in the preferences of those who buy musical instruments-all of which affect the vintage instrument market. I have also heard an increasing number of statements that are inflammatory to my ears. For example, "Stratmania" is the result of dealers trading among themselves to artificially inflate prices; old instruments are as a rule overpriced and over-rated compared to new ones; collectors should be condemned for paying such high prices that quality instruments are unaffordable to musicians.

Such easy explanations, blanket statements and knee-jerk reactions are at best gross oversimplifications and are often misleading or just plain wrong. The vintage instrument business may be relatively young, about 30 years old, and it is still so small that only a handful of dealers make their primary income from vintage sales, but it is a complex, international business that cannot be explained in a single sentence or a simple allegory.

There are many forces at work that determine just what instruments are in demand and at what prices. I've organized them into the following areas:

Part 1: The utility market, a basic background look at used instruments and how they have compared to new ones.

Part 2: How instruments are priced

Part 3: The role of the collector as opposed to the musician

Part 4: Fads, their causes (including the effect of star musicians and the recent Stratmania craze) and effects on the market.

Part 5: Market dynamics, social and economic factors, assessing the value of an instrument.

Part 6: The vintage dealer as trendspotter

Part 7: Instrument sales and musical styles