JPMorgan Chase & Co. (JPM), eBay Inc (EBAY): Banking, War, and a Bursting Beanie Bubble

The Beanie Baby rise and fall rather neatly paralleled the surging stock market of the 1990s. The Dow Jones Industrial Average tripled from the launch of the first Beanies in late 1993 to their “retirement” at the end of 1999. Unlike Beanie Babies, the Dow eventually recovered and even surpassed its 1999 levels after the dot-com crash, because it’s a representation of 30 of the most powerful companies in the United States, and Beanie Babies are sacks of beans. At least one person had the foresight to call the Beanie Bust: On the day of Ty’s announcement, collectibles expert Tony Hyman’s scathing and prophetic anti-Beanie commentary showed up on CNN:

“This is all phony,” he said. “This is a passing fad. Fifteen years from now people will say ‘Beanie Baby what?’ America is this insane nation driven by one fad after another. Something’s going to come screaming out of the cupboard in six months to replace them.”

Hyman, author of Trash or Treasure: A Directory of Buyers, said that while the numbers surrounding the Beanies may be impressive, “value only takes place when an item changes hands.”

“You don’t have something worth $100,000 until you find someone who will pay you $100,000,” he said. “In 15 years, my prediction is that it’s going to be damn hard to find someone willing to take serious money out of his pocket to buy a stuffed little bag of beans.”

Nearly 15 years later, Hyman was absolutely right. In mid-2013, a documentary called Bankrupt by Beanies  surfaced to tell the tale of one ridiculous family that sank — no lie — $100,000 into its collection, which numbers in the thousands. Family patriarch Chris Robinson later told the press that he viewed his collectible craze as “bonding with my family, despite it being an extraordinary waste of money that would have been better spent on pretty much anything else.”

For sale: family bonding time, $100,000. May resemble a sack of beans.

The article Banking, War, and a Bursting Beanie Bubble originally appeared on Fool.com and is written by Alex Planes.

Fool contributor Alex Planes holds no financial position in any company mentioned here. Add him on Google+ or follow him on Twitter, @TMFBiggles, for more insight into markets, history, and technology.The Motley Fool recommends eBay and owns shares of eBay and JPMorgan Chase. 

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