Invest in Tobacco?

[canucklehead]

Another potential issue is the IRS in the US and the CRA up here in Canada have said that they will be heavily cracking down on online sales of all varieties, and specifically on sale of used goods through such venues as FB marketplace, Kijiji, Craigslist, and even forums such as this. They don't want people making money selling used clothing, vintage tupperware, or antique knickknacks without them getting some of it. Big brother is watching you and he wants more income tax.

 

[Casual]

I plan to bury my tobacco until retirement. Then I will dig up a jar now and then, out of sight of the telescreen. I‘ll have to dig at dusk, when there’s little light but before the enforcement drones have flipped over to infrared. My diagnostic chip implant will detect the nicotine, and I’ll be docked 100 Trudeau credits, but it‘ll be worth it. I’ll just go a day without my cricket protein ration, to pay for it.

 

[OSOBUCO]

You failed to factor in the possibility of your early demise or, an illness which would prohibit your smoking your stash. The loss wouldn't be yours of course. Only your heirs would be out a bit of moneys. There's no mention of something where the moneys tied up in tobacco become needed for a catastrophe of some sort, illness, natural disaster, etc. But, since you are not risk averse there is no need to consider the risk. Just spend, sorry, invest what you will and see what arises. And, there are your risks, many of them. Ignore at your peril but, you should consider them at least.

There's more. Tax free? Only as long as you aren't found out. Someone, family or friend, board member could rat you out. There is always risk. One should at least know them and acknowledge them so as to weigh risk v. reward.

And, there you are, your required due diligence all set out, tidy and neat, for you to consider. Scenarios are a fun mental activity but, don't simply consider "best possible" if you value your funds.

Wow. I was sort of joking hence the wink above but my buzz is now thoroughly killed.

 

[anotherbob]

Ok - so picture this scenario - I buy 5 grand in tins of fine tobacco that i have observed selling for >2x original cost with >2 years age on them on this site. Then I wait a few years and list them for 2x. They sell I double my $ (tax free btw) and I smile. They don't sell and I have a cellar full of aged fine tobacco and I still have a smile on my face - where's the risk? sorry couldn't resist

I was just about to go on here and say the one good thing is you will still have the tobacco. If you're thinking is I get this tobacco I can smoke it and that's awesome but if I can sell it for a certain amount and that's better... Well if that's the case then it's a good idea.
One other thing if you bought enough to get a decent profit it would lower the price because you'd have to "flood" the market.

 

[warren]

Didn't mean to harsh your mellow. Just providing some angles perhaps you hadn't thought of.

 

[Jimmy_Jack]

It’s a safe place to park money for sure. Make money…meh. Cuban cigars made money for me but not by choice. I just lost interest. Pipe tobacco…not seeing it. You’ll get out what you put in at least.

 

[sablebrush52]

It's a small percentage of blends that get the big bucks, famous names like Balkan Sobranie, Bohemian Scandal, vintage versions of Dunhill blends actually made by Dunhill, Wills made Three Nuns, etc. Your basic "status" blends.

A lot of those blends are 15 to 40 years old. Appreciation on almost all of them is pretty negligible when time is factored in.

Sure, brand new McClelland and Esoterica blends can get instant multiples, but they're a pretty small exception, and your HU, or C&D isn't likely to become a big money maker.

Mostly, you'll be lucky to get your money back, given seller's fees, shipping, taxes (ways to track taxes are being implemented with various states sharing purchasing information), etc, assuming that legislation banning all non face to face transactions never gets passed.

Want to have something for retirement? Buy index funds and keep adding to them. Over 40 years you'll make a lot more than on tins of tobacco you hope to be able to sell in future.

 

[trouttimes]

I invest/ cellar tobacco I like to smoke because I have seen it disappear, increase in price due to inflation and had state and fed taxes and fees cause a big increase in price. I do not expect it to be an investment. A twelve dollar tin of the frog I’ve had 10 years is better than a $100 tin I buy next week in my book. I also can afford to cellar now.

 

[hoosierpipeguy]

Tobacco is an investment in your smoking future. It's a hedge against blends being discontinued, deeming, additional taxation and price increases. As far as a good financial investment, I think there's better places for your money.

 

[mso489]

Very few make any money investing in rare blends of tobacco. It would require money to invest in the first place; continuing hours of research for years to develop the expertise to know in quantitative terms what blends are the good buys and where the market for sales is; and luck and possibly serious loses if you made the wrong calculations.

Like any business, it is labor and years of your life, not a happy sideline to enjoying pipe smoking. So, are you ready for that? If not, don't indulge the fantasy. I just finished a superb tin of properly aged McC's Dark Star I bought when it was 12 USD a tin. It was fabulous. Would I buy a tin at today's prices? No.

 

[leonardbill1]

I buy what I like or what looks interesting. I smoke bulk blends during the day and therefore I don't burn through the tins very fast, so I've ended up with cellared tobaccos. At this point I look at the cellar primarily as a convenience and as insurance against discontinuance, but it has also been a source for trades or an occasional sale to fund/defray the purchase of out of production or hard to find tins. Liquidating any large group of items is a time-consuming process, so unless a person is wiling to invest the time and work to get retail price they should expect to sell at less than retail to someone who is willing to do the work to make the retail sales.

 

[captpat]

Tobacco is an investment in your smoking future. It's a hedge against blends being discontinued, deeming, additional taxation and price increases. As far as a good financial investment, I think there's better places for your money.

Agree completely with this. Besides in order to get the "big bucks," you have to successfully predict what will become a unicorn at some point in the future. Further, as has already been observed, all we know is the asking price, not the actual selling price. Because I cellared wisely I ignore the sales threads that have wildly inflated asking prices.

 

[lukasstrifeson]

Sounds like politician speak for "Tobacco Flipper" to me...

Nevermind how we all collectively feel about these phonies (that should be a hint), the task is much greater than you think too. There are a plethora of risks/obstacles to flipping: first and foremost, how are you planning on getting $5000 worth of fill-worth tobacco? The ones with enough value on the resale market would be sold out instantly with a min year-long wait lists.

 

[Streeper541]

Sounds like politician speak for "Tobacco Flipper" to me...

?

 

[Donb1972]

I have dozens of tins of Visions of Celephais, only because the things I like tend to be discontinued sooner or later, haha. If Visions were to be discontinued, and the value skyrocketed ~ would I sell them? Maybe...if the prices were astronomically high.

But trends can be iffy. So I'd say go ahead. Just be sure it's something you'd want to smoke if you can't re-sell them at some point.

 

[Peter Turbo]

Given what I see tins selling for with a bit of age on them up to 10x or more I think tobacco may be a decent investment

im always haggling my dude, some people on this forum get awfully stiff about it too.

 

[trouttimes]

 

[sandollars]

Wow. I was sort of joking hence the wink above but my buzz is now thoroughly killed.

I hope it wasn't expensive booze..

 

[briarbuck]

Given what I see tins selling for with a bit of age on them up to 10x or more I think tobacco may be a decent investment

You're about 5 years late. But yes, it's appreciating faster than the market.

 

[jpmcwjr]

Given what I see tins selling for with a bit of age on them up to 10x or more I think tobacco may be a decent investment

Speculation, yeah. A few fast buck here and there, yeah.

But an investment? Only in the sense you might say, "I'm going to invest in a couple of movie tickets tonight"

No one has made a living from trying to "invest" in tobacco.