(Topic ID: 221074)

How Will The Next Economic Crash Affect The Pinball Industry?


By o-din

2 years ago



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  • Latest reply 3 months ago by cottonm4
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There are 320 posts in this topic. You are on page 1 of 7.
#1 2 years ago

Historically speaking, pinball had it's greatest years of production and has been the healthiest during the worst of economic times.

During the 30s throughout The Great Depression, there were hundreds of manufacturers making perhaps thousands of different titles, some of which selling as many as 50,000 units a piece. Then again during the sluggish economy of the 1970s, pinball had it's second greatest decade of all time.

Between those decades, times of economic growth saw lackluster pinball production at best and during the economic boom of the 80s, pinball almost vanished into obscurity. After Black Monday in 1987 and the sluggish economy that followed thru the early 90s, pinball started to thrive again. By 2000, the economy was growing again, and once again pinball was struggling to survive. Throughout the 2000s as the economy grew at an alarming rate, it seems pinball was hanging by a thread.

With the crash of 2008, the above pattern ended and did a complete 180. Pinball did not see a renaissance during the recession that followed, but seemed to struggle right along until the economy started to recover. It wasn't until about five years ago that both the economy and pinball were hitting their stride again with both looking very healthy today.

So, the question is when the next crash hits, which could happen any day now, as history shows ten years of solid economic growth is usually the limit before something like this happens, will the pinball industry survive or be thriving like we haven't seen since the 1970s, or will it vanish into the night like so many over inflated 401k accounts? My guess is it will be somewhat close to the latter.

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#2 2 years ago

As the world becomes more and more digital, you see a lot of interest in 'retro' gaming. That is what largely brought me back to pinball 4 years ago. It is an analog form of entertainment that simply cannot be matched in the console or digital world, IMHO.

I feel that is also why Nintendo had a lot of success with the NES Classic. I think as technology advances, it doesn't always translate to a better gaming experience. It almost has a tendency to get in the way. That is why people go back to playing older games where the gameplay is more pure.

As far as pinball goes, I can only say I have seen a bump in interest with more pubs popping up in this area with pinball machines. I hope the trend continues!

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#3 2 years ago

You won't know until it's happening or over.

A war, love affair, depression, never follow the same rules as the last one. And it effects people differently.

After the 1929 depression a lot of those people saved string and wrapping paper. During the 2005 down turn, I don't recall people doing that.

LTG : )

#4 2 years ago
Quoted from LTG:

After the 1929 depression a lot of those people saved string and wrapping paper.

Is that what they were making all those pinball machines out of during the greatest decade pinball has ever known?

12
#5 2 years ago

deeproot will bail out the govt

#6 2 years ago
Quoted from CosmoJoe:

As the world becomes more and more digital, you see a lot of interest in 'retro' gaming. That is what largely brought me back to pinball 4 years ago. It is an analog form of entertainment that simply cannot be matched in the console or digital world, IMHO.

I feel that is also why Nintendo had a lot of success with the NES Classic. I think as technology advances, it doesn't always translate to a better gaming experience. It almost has a tendency to get in the way. That is why people go back to playing older games where the gameplay is more pure.

As far as pinball goes, I can only say I have seen a bump in interest with more pubs popping up in this area with pinball machines. I hope the trend continues!

And what affect will the next economic crash have on all this, or the price of tea in China for that matter?

#7 2 years ago
Quoted from InfiniteLives:deeproot will bail out the govt

#8 2 years ago
Quoted from o-din:

So, the question is when the next crash hits, which could happen any day now, as history shows ten years of solid economic growth is usually the limit before something like this happens, will the pinball industry survive or be thriving like we haven't seen since the 1970s, or will it vanish into the night like so many over inflated 401k accounts? My guess is it will be somewhat close to the latter.

Excellent question! You never let me down.

I'd say that the next economic crash, which is sure to happen in the next 2-6 years for obvious but I-swear-not-political-reasons - ALL of the 40 or so current pinball companies will disappear with the exception of Stern. They are the only ones positioned to survive a lengthy economic downturn before they simply run out of cash or their rich and bored benefactors look for another hobby or have to tighten the purse strings as they transition from being super rich to merely rich.

Outside shot Spooky could survive, but I just don't know that a recession won't prune away enough buyers that boutique pinball is no longer feasible.

And don't get excited people, pinball prices won't drop, and people won't dump their $8,000 games for pennies on the dollar. Didn't happen last time around, won't happen this time. people just held on to their stuff and asking prices didn't budge.

But a full-on depression? Now you are talking!!!

#9 2 years ago
Quoted from o-din:

And what affect will the next economic crash have on all this, or the price of tea in China for that matter?

Hah yeah sorry I realized I never really finished my train of thought I was going to say, I think if we see another sharp recession, the interest you have seen in retro gaming would insulate the pinball industry to some degree. Of course, how well run and efficient some of these smaller boutique companies are really will determine if they weather an economy on a downturn.

If interest rates rise a significant amount, that could also affect the ability of more HOU purchases. I don't know how many people here have bought machines on credit but the rates are pretty generous right now. I have gotten so many 'no interest for 18 months' offers I have lost count.

#10 2 years ago

Just so you guys know where I'm coming from and it's not something crazy I didn't spend time thinking about and just made up out of nowhere. I rode the snail pace economy of the 70s when there were pinball machines everywhere and little pocket change so every replay and special counted.

I've also watched the economic rollercoaster ride ever since then.

Take a look at the graph I posted yesterday in the "economy on fire" thread and then ride with me front row POV on Goliath. One of the tallest rollercoasters I've ever been on. It's fun!
3700_2 (resized).png

#11 2 years ago
Quoted from o-din:

Just so you guys know where I'm coming from and it's not something crazy I didn't spend time thinking about and just made up out of nowhere. I rode the snail pace economy of the 70s when there were pinball machines everywhere and little pocket change so every replay and special counted.
I've also watched the economic rollercoaster ride ever since then.
Take a look at the graph I posted yesterday in the" economy on fire" thread and then ride with me front row POV on Goliath. One of the tallest rollercoasters I've ever been on. It's fun!

Wow! Things really turned around starting in 2009! I'm gonna go get me a hope hat!

This time will be different. Surely the coaster will just keep it's slow and steady climb to dizzying new heights.

#12 2 years ago

As the extra spending monies go down, so do the number of threads involving "Mistreating of games" & "Which games should I buy next" in the title.

#14 2 years ago
Quoted from LTG:

During the 2005 down turn, I don't recall people doing that.

2008 I believe. I remember the DOW hitting 14,000, and on that very day the only thing I could think of was-

SELL!! SELL!! SELL!!

#15 2 years ago

There will always be an economic boom and bust on the horizon. Right now the US economy is booming and doesn't seem to be slowing down anytime soon. I say let the good times roll, lol. When a recession does hit, and it will, let's just hope it's not as as bad as the one in 08-09.

#16 2 years ago

Market crashes Grayman buys minty EM's for $50.00 each, SS's for $ :lol:75.00 & newer ones like Twilight Zone for a "C" note!

Loads up on more rental property too.

#17 2 years ago
Quoted from PanzerFreak:

let's just hope it's not as as bad as the one in 08-09.

Hope yourself!

Like Grayman, I'm looking to capitalize this time.

#18 2 years ago
Quoted from PanzerFreak:

There will always be an economic boom and bust on the horizon. Right now the US economy is booming and doesn't seem to be slowing down anytime soon. I say let the good times roll, lol. When a recession does hit, and it will, let's just hope it's not as as bad as the one in 08-09.

Just remember on oct 18, 1987 everyone went about their day as normal..... for everything there is a season..........

#19 2 years ago

2008 was different whole banking system almost collapsed. Do you think bank insurance could have covered that? Would have been lucky .10 on the dollar maybe?
People just don't know how close it came.

#20 2 years ago
Quoted from Grayman_EM:

People just don't know how close it came.

And how quickly they forget.

#21 2 years ago

One thing for sure.

Odin's dog will be smoking cheaper cigars come the down turn.

LTG : (

#22 2 years ago
Quoted from LTG:

One thing for sure.

Odin's dog will be smoking cheaper cigars come the down turn.

LTG : (

I'm always prepared.

The dog already gets the cheapest cigars, but her master may have a tough time trading in his Jack Daniels for Evan Williams.

#23 2 years ago
Quoted from o-din:

Just so you guys know where I'm coming from and it's not something crazy I didn't spend time thinking about and just made up out of nowhere. I rode the snail pace economy of the 70s when there were pinball machines everywhere and little pocket change so every replay and special counted.
I've also watched the economic rollercoaster ride ever since then.
Take a look at the graph I posted yesterday in the "economy on fire" thread and then ride with me front row POV on Goliath. One of the tallest rollercoasters I've ever been on. It's fun!

One of the better coasters there. Love the high g helix after the brake run.

#25 2 years ago

I'm more interested in the potential of buoyant cabinets for when the ocean levels rise.

#26 2 years ago
Quoted from dsuperbee:

One of the better coasters there. Love the high g helix after the brake run.

Yeah, I can't sit in the back seat on that one. I can only stand a couple seconds of greying out at one time.

#27 2 years ago

banks makin' that chedda - JP Morgan posts 8.3 billion dollar profit in second quarter...

https://money.cnn.com/2018/07/13/investing/jpmorgan-chase-earnings/index.html

credit, the opium of the masses. cant wait for that debt to catch up

#28 2 years ago
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#29 2 years ago

I imagine a crash won’t impact any new made in the USA pins as they don’t need to import any components to keep prices in line with inflati....

..well crap!!!

#30 2 years ago

Regurgitated in 2018, We’re back baby!!!!

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#31 2 years ago

Should the economy turn ugly only the little guys will fall. JJP and Stern have had plenty of time to re-establish pinball. Their production will slow that's it.
The deals will ramp up the longer the down turn lasts as collectors, both major and minor, feel the pinch and tap their beloved resource.
Should it last 3-5yrs, you better have saved wisely because the deals will be rampant!
$2000 Fathom anyone?

#32 2 years ago

Do economic crashes really affect expensive items? I figure it mostly affects the middle class and below. In the past crash ten years ago the really expensive neighborhoods around here remained really expensive since most sales on those are all cash anyways. Like wise for high end cars, etc. I always assume Stern and others were purposely raising prices to shift to a more high end market because one of the benefits of that is not being affected by market crashes. Add in the fact that lots of buyers nowadays are foreign makes me think a market crash would not affect the NIB pinball market at all.

Now the used market is a totally different matter...

#33 2 years ago

I don't know that resale prices on home games would fluctuate too much -- at home entertainment and "stay-cations" may increase in popularity again when everything else gets expensive.

I also agree that the big companies should hold up fine while smaller startups with tighter margins may struggle. There is a reason why you do not see DeSoto, Packard, or Studebaker car dealerships anymore. The chubby bunny rabbit tends to survive the winter a bit easier than the skinny one does.

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#34 2 years ago

I'm guessing when it happens, it won't affect the wealthy that much as they are usually the cause of these things and are always prepared to make a buck either way.

But then there is the above average Joe who is now flush with cash due to working hard and good investing while the economy has been thriving over the last several years and has put himself together a nice little collection of NIB games and top notch classics. But all the sudden some of his investments are in the tank and that well paying job is no more.

His mortgage can't pay for itself and there is still 15-20 years left to pay it off. So a mad scramble occurs to start trying to get back some of the money he has invested in these toys and other things, but the market is now flooded with others doing the same, so he is lucky to get half his money back.

The pinball manufacturers try to adapt by making $25,000 Super LES, thinking the wealthy are still interested and they do sell a few. On the other end there is no more market for mid range premiums, as those are the buyers that are getting hit the hardest. So they come up with some cheaper street level games, but that doesn't go over too well either... to be continued...

#35 2 years ago

Usually in bad economies coin op does good, cheaper entertainment.

Didn't help last time.

No idea on next time.

LTG : )

#36 2 years ago
Quoted from LTG:

Usually in bad economies coin op does good, cheaper entertainment.

Didn't help last time.

That's the whole nature of this thread.

During the worst economies, pinball and coin op always did the best. But now that it has shifted to home buyers and home entertainment, that may not apply any more.

#37 2 years ago

What does happen though is o-din finally gets his Supreme pinball machine for way less than he's offering to pay right now. In fact less than it sold for NIB

#38 2 years ago
Quoted from o-din:

What does happen though is o-din finally gets his Supreme pinball machine for way less than he's offering to pay right now.

And gets to provide a home for the guy trying to do a fundraiser to get it.

LTG : )

#39 2 years ago

When the economy's in the tank is when I get in an RV and set out on another little road trip. Always the best time to do such things. And a stop in Hopkins Mn. is certainly on my to do list.

#40 2 years ago
Quoted from o-din:

And a stop in Hopkins Mn. is certainly on my to do list.

I said I was sorry. No need to stop by and settle up.

LTG : )

#41 2 years ago

I was just thinking about maybe eating some of your popcorn and throwing a few quarters in Break Shot is all. And of course shaking the hand of the legend himself.

That's what's great about recessions. Plenty of time to do the things you want.

#42 2 years ago

I will buy everyones’s pins that is over extended. I am an idiot and keep only cash. Lol

#43 2 years ago
Quoted from o-din:

I'm guessing when it happens, it won't affect the wealthy that much as they are usually the cause of these things and are always prepared to make a buck either way.
But then there is the above average Joe who is now flush with cash due to working hard and good investing while the economy has been thriving over the last several years and has put himself together a nice little collection of NIB games and top notch classics. But all the sudden some of his investments are in the tank and that well paying job is no more.
His mortgage can't pay for itself and there is still 15-20 years left to pay it off. So a mad scramble occurs to start trying to get back some of the money he has invested in these toys and other things, but the market is now flooded with others doing the same, so he is lucky to get half his money back.
The pinball manufacturers try to adapt by making $25,000 Super LES, thinking the wealthy are still interested and they do sell a few. On the other end there is no more market for mid range premiums, as those are the buyers that are getting hit the hardest. So they come up with some cheaper street level games, but that doesn't go over too well either... to be continued...

You forgot to mention that the $25k Super LE's will tank in price when this happens in which once the economy booms again after the drought these super LE's will be worth $35k and once pinball manufacturers realize this, they will go remake these super LE's as Ultra LE Vault Editions for $40k hence tanking the original Super LE's once again.

#44 2 years ago

I'm glad you guys are with me on this.

This is what you get when I get called into work on a Friday.

Bonus time!

Friday the 13th to boot.

#45 2 years ago

I do remember 24, CSI, NBA, BBH and Stern seeming like they were doomed and the Iron Man was the worst BOM ever complaints. But on the other hand, games took longer to sell but no MM for $2500 like predicted as everyone sat on them and played the crap out of them.

So my prediction is we won't get to capitalize on the next one like we didn't on the last one.

#46 2 years ago

Well hell, when the big slide happens we may finally get that Big Buck Hunter VE after all.

#47 2 years ago

JJP would be the first to go, and Stern the last.
Reason being, both are volume leaders, but when sales volume falls off, JJP will not survive on a portfolio only of the 3 highest priced machines in the market AND mostly being purchased by home users, not the arcades that someone already mentioned always do well in a bad economy. So the decline in demand will come from beleaguered home collectors, and it'll kill JJP.

While both have fixed costs (factories), Stern at least maintains production on-line of 5 or 6 machines at a time, and so has room to contract, thrive and ride it out. JJP has very little room to contract.

Everyone else is so scaleable- never grew big enough to own factories- so actually the boutiques might survive okay.

#48 2 years ago

Apple stock was $12 at one time.

Bill Gates agreed to invest $150 million for shares of Apple non-voting preferred stock (which helped keep Apple afloat) but by 2003 Microsoft had sold it's entire stake in Apple.

Those 36.2 million shares if Microsoft had kept them? They would be worth billions today.

#49 2 years ago
Quoted from PinballFever:

Apple stock was $12 at one time.
Bill Gates agreed to invest $150 million for shares of Apple non-voting preferred stock (which helped keep Apple afloat) but by 2003 Microsoft had sold it's entire stake in Apple.
Those 36.2 million shares if Microsoft had kept them? They would be worth billions today.

And your point is...?

#50 2 years ago
Quoted from TheLaw:

As the extra spending monies go down, so do the number of threads involving "Mistreating of games" & "Which games should I buy next" in the title.

That will make pinside boring

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