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The Crash of 1993

As the great comic-book bubble showed, sometimes there’s no recovery from a speculative boom

Jun 13, 2011, Vol. 16, No. 37 • By JONATHAN V. LAST
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This might sound like an industry marching toward oblivion, yet in 2009, Disney paid $4 billion to acquire Marvel (DC was already owned by Time-Warner). The reason for this gaudy valuation is that the comic books themselves are no longer important to the comic-book industry. They’re loss leaders. The real money is in the comic-book properties, which power toy and merchandise sales, theme parks, and above all else movie franchises. Since 1997, 26 comic book adaptations have gone on to gross more than $100 million at the box office. Twelve of these grossed more than $200 million. More—many more—are coming soon to a theater near you.

As a financial concern, comic book publishers are no longer in the publishing business: They’re curators of, and incubators for, extremely valuable intellectual property. To comic-book collectors, that’s very good news.

Or rather, it’s very good news for some comic-book collectors. As a boy I had the misfortune to be buying comics in the run-up to the bubble. Almost none of my books ever recovered their value. Sure, Action Comics #1 will fetch you a million plus, but look around on auction websites and you can find sellers offering lots of a thousand Bronze- and Modern-Age comics—the books I was collecting—for $10. They’re worth just a little less than firewood. 

As painful as it was for some of us, the comic-book bubble teaches two important lessons. First, bubble-mania is not always the fault of buyers and sellers. Sometimes it’s caused by intermediaries. Second, sometimes markets don’t “come back.” People who owned blue-chip comics took a hit in 1993. People who owned modern-era comics were wiped out, the value of their collections never to return. 

The comic-book market resembles today’s housing market in unsettling ways. The substantive differences between houses and comic books are as obvious as they are enormous. Yet in both cases the speculatory bubble was helped along by irresponsible middlemen—the distribution companies in one case and the credit-ratings agencies and mortgage appraisers in the other.

And it’s unclear to what extent the housing sector is going to rebound. We are now officially in a housing double-dip, with prices in most parts of the country below what they were in 2000—and still falling. Discussing the topic several weeks ago, Moody’s economist Celia Chen told reporters that, nationally, house prices might regain their 2006 levels by 2021. In some large states—such as Florida and California—Chen placed the recovery in 2030. What’s terrifying about such predictions isn’t the specific date. It’s that either way, the return of prosperity is so far in the future as to indicate that no one really has any idea when recovery will come. Or if.

Lots of houses are the functional equivalent of blue-chip comic books. Like a copy of Action Comics #1, a co-op in Manhattan, a townhouse in Georgetown, or a bungalow in Santa Monica will eventually regain its previous value and will prove to be an excellent investment in the long run. And the same can probably be said for the majority of suburban homes in established metro areas from Seattle to Atlanta.

But during the run-up to the housing crash, a crush of construction appeared in places like the Carolina coasts, the southwestern desert, and pockets of Florida. In the summer of 2009, the Associated Press ran a story on Victor Vangelakos, who bought a condominium unit in a new 32-story waterfront building in Fort Myers. He’s the only person in the building—every other unit was either foreclosed on or never sold. That’s not quite as bad as things are in Spain, where entire towns sit vacant. In Yebes, an hour from Madrid, hundreds of rowhouses sit empty on brand new streets. Almost none of them was ever sold. Yebes is a ghost town now, unlikely ever to “come back.”

I have a comic book like that. In 1984, DC launched what became an immensely popular series, The New Teen Titans. The first issue carried a premium cover price of $1.25, the result of the series being printed not on the usual newsprint but on higher quality “Baxter” paper. I missed the first issue when it debuted, and the back-issue price quickly climbed. In a few months I saved up the scratch to buy a copy. 

I paid $25, a not-inconsiderable sum for a 10-year-old. It was the jewel of my collection. Today you can buy a copy in near-mint condition for $1.50.

Jonathan V. Last is a senior writer at The Weekly Standard.

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