In May, the legendary investor known as the “Bond King”, Bill Gross, called time on the “total return” strategy that made his fortune in the 1980s. Interest rates are too low relative to the almost 16% seen in 1981 (despite what anyone coming up to renew their mortgage may say) and that approach is now defunct, he said. But Gross is also gloomy about another of his favourite strategic pastimes – stamp collecting. The hobby has “always been a function of kids and their collecting who later on become wealthy adults”, he told Bloomberg TV in June. “But… I don’t think kids are collecting stamps any more.” So, he decided to sell up.
Gross was introduced to philately when his mother gave him an album of stamps in the hope that he could sell them to pay his way through university. The stamps, however, turned out to be largely worthless. Nevertheless, Gross “wanted to prove his mother right, that stamps could be a good investment”, explains Robert A. Siegel Auction Galleries, the auction house in New York that sold Gross’s stamp collection last month.
The goal to which every serious collector aspires is to build a “complete” collection – that is, to acquire at least one of each item within their chosen field of interest. But within the world of US stamps, there can only ever be one winner at a time. That’s because there is just one privately owned 1868 one-cent “Z” Grill stamp in existence. Another has been held by The New York Public Library for almost a century and, to be sure, if the librarians ever decided to sell it, they could buy a lot of books with the proceeds.
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Gross was outbid when he tried to buy it at auction in 1998. It was snapped up by the president of the Mystic Stamp Company, Donald Sundman, for $935,000. So, in 2005, Gross bought the also incredibly rare 24¢ Inverted Jenny plate block of stamps, accidentally depicting an aeroplane flying upside down, for nearly $3 million, and traded it for Sundman’s “Z” Grill in what was described as the “greatest stamp swap of all time”. Finally, Gross had completed his collection of US stamps. On 14 June, he gave someone else the chance to complete theirs and it cost them almost $4.4 million for the privilege.
The auction record for the most expensive stamp overall is still held by the British Guiana one-cent Magenta from 1856, which fetched $9.5 million in 2014. At least there remains, as Robin Wigglesworth notes for FT Alphaville, one “arena where British securities are more highly valued than American ones”.
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