Recent Inflation on the Price of German Basses

[Contranash]

After about a month of looking at basses around the east-coast, I've heard from several shops that the price of a quality-made German bass has gone up drastically over the past decade or so. I've been hearing of basses that, 10-15 years ago, went for 12-15k, are now going for much much higher, in the high 20s to low 30s. Could anyone offer any reasons or theories as to the cause of the recent inflation? Do you think its reasonable? Also, is there not the danger of the inflation bubble bursting a couple years down the road?

Being new to the bass market, I'd appreciate the thoughts and experience of the older players/buyers.

-Nash

[the byronic man]

Originally Posted by Contranash

After about a month of looking at basses around the east-coast, I've heard from several shops that the price of a quality-made German bass has gone up drastically over the past decade or so. I've been hearing of basses that, 10-15 years ago, went for 12-15k, are now going for much much higher, in the high 20s to low 30s. Could anyone offer any reasons or theories as to the cause of the recent inflation? Do you think its reasonable? Also, is there not the danger of the inflation bubble bursting a couple years down the road?

Being new to the bass market, I'd appreciate the thoughts and experience of the older players/buyers.

-Nash

While Germany's economy has stayed pretty healthy recently, the rest of the EU hasn't been so lucky. The continued economic issues and devaluation of the Euro are likely at least partially to blame for any sort of rise in cost.

[Contranash]

Originally Posted by the byronic man

While Germany's economy has stayed pretty healthy recently, the rest of the EU hasn't been so lucky. The continued economic issues and devaluation of the Euro are likely at least partially to blame for any sort of rise in cost.

Makes sense. But is that still applicable to 19th century basses? If so, I'm assuming that means that most German basses now on the market have been recently imported. I feel like an instrument that has been in the states for several decades wouldn't feel the bite of German economics. Perhaps the imported instruments of similar/comparable make have influenced the price.

[prd004]

The failure of the Euro, as both a currency and EU as a whole. Countries like Spain, Greece, Portugal, and many more are going into bankrupcy as a result of the EU, and banking derivitives forced upon them by the EU. So thier currency buys less and less so things have to cost more to stay in business

Likewise, the US dollar is plummeting in value and buys less and less both here and over seas. Our Federal reserve keeps printing more money to cover our national debt, but all that really does is drive up interest rates and lower the value of the dollar.

In short, it has little to do with the instruments themselves, it's all a matter of economics!

[the byronic man]

inflation/devaluation is pretty severe with both USD and Euros currently, so it could potentially be on both ends. Germany is actually one of the strongest economies in the EU currently. it's the other ones bringing it down.
Also, working out the math for exponential growth at 3%(a pretty standard # for inflation), a bass that cost 15k 15 years ago would cost between 23-24k taking just inflation into account. that leaves a lot of room for supply/demand related price bumps and all those fun things.

[Contranash]

Originally Posted by the byronic man

inflation/devaluation is pretty severe with both USD and Euros currently, so it could potentially be on both ends. Germany is actually one of the strongest economies in the EU currently. it's the other ones bringing it down.
Also, working out the math for exponential growth at 3%(a pretty standard # for inflation), a bass that cost 15k 15 years ago would cost between 23-24k taking just inflation into account. that leaves a lot of room for supply/demand related price bumps and all those fun things.

Interesting. The feeling I've been getting is that German instruments in particular have gone up more than, say, French or Italian. Now, I know that the bass market itself has been playing catch up the rest of the string family, but what I've been told is that the German bubble especially has been expanding.

[Stick_Player]

The dollar has lost value.

15 years ago, you should've bought gold at $385/ ounce.

In 1996, a $15,000 bass would cost 39 ounces of gold.

In 2011, a $30,000 bass will cost 19 ounces of gold.

So, I guess basses have actually dropped about 50%.

It all depends on what you are paying with.

[PaulCannon]

Originally Posted by Stick_Player

The dollar has lost value.

15 years ago, you should've bought gold at $385/ ounce.

In 1996, a $15,000 bass would cost 39 ounces of gold.

In 2011, a $30,000 bass will cost 19 ounces of gold.

So, I guess basses have actually dropped about 50%.

It all depends on what you are paying with.

I buy all of my instruments with pure gold nuggets.

Isn't gold itself in a pretty major bubble at the moment?

[Stick_Player]

Originally Posted by PaulCannon

I buy all of my instruments with pure gold nuggets.

Isn't gold itself in a pretty major bubble at the moment?

If you think that a gold-bubble is about to burst, then it would be a good time to sell your pure gold nuggets for a German bass.

Seriously, my point was to illustrate that, over time, many things fluctuate in value.

Sure, a bass may cost more dollars today than 15 years ago, but the same bass costs less in gold.

[Contranash]

My question is why German basses in particular seem to have risen to drastically?

[Stick_Player]

Originally Posted by Contranash

My question is why German basses in particular seem to have risen to drastically?

Most likely a combination of what has been stated and 'perceived' value.

Could be supply and demand.

As was suggested, it's economics.

[Eric Hochberg]

Originally Posted by Contranash

My question is why German basses in particular seem to have risen to drastically?

Supply of good older basses is finite. The Germans are just rising with demand and filling the gap caused by over priced and valued French and Italian basses.

[Dr Rod]

the prices quoted are in the USA, and in US dollars, right?

the Euro has nothing to do with US dollar prices: if US dollar prices have gone up, it means that US dollar devaluation is one of the probable causes, not the Euro mess.

In economic terms prices can go up if:

-demand for the good increases
-supply for the good decreases
-the objective exchange value of the money in which the good is being quoted decreases (in this case US dollar)


mind you, prices might have gone up in Euro terms as well

[Matthijs]

Originally Posted by Eric Hochberg

Supply of good older basses is finite. The Germans are just rising with demand and filling the gap caused by over priced and valued French and Italian basses.

This seems to be the best explanation, as your question is not about recently imported German instruments.

Even if macro-economics would explain this, the explanation of the euro as a "failed currency" is wrong. The value of the euro isn't going down substantially, despite some economically weak countries in the eurozone. If you're looking for an answer in macro economics, have a look at the exchange rates: Exchange rates between the euro and dollar went from 1.1 to 0.7 euro's for a dollar in the last 10 years. So a 20000 euro german bass would have cost you 18000 dollar in 2001 and wil cost you 28000 now. There's not much money to be made in exporting basses from Europe to the VS. Currency's can 'fail' in many ways, one of them by being worth to much.

[Steve Swan]

In the last 10 years the german line that I like to carry has gone up over 100% wholesale. The rate of increase was most dramatic about 2005-06.

[rjspear]

In the case of older basses, it's really got be just a case of supply and demand. The prices have gone up partly because players are willing to pay higher prices. If German basses are perceived to be a better value in terms of reliability and tone, perhaps that accounts for the reason sellers are finding out what the market will bear.

Modern basses, even from Germany, are often sourced in part from other countries, and so they are subject to the same pressures. In my business, the cost of shipping plus fuel surcharges adds somewhere between 20% -22% to the final cost. That's a lot! In addition, the dollar has been gradually weakening against some important world currencies, in particular the Chinese yuan. We have been lucky not to have inflation here (so far), but that's not the case in some other European and Asian countries, so that gets passed along to us in the products we import. My opinion, fwiw.

[robobass]

I don't think the Euro or world economics has anything to do with it. Most older German basses in the US were imported long ago and have been bought and sold in dollars many times over. IMO, the price was kept low in the last ten to fifteen years because demand fell off with the boom in availability of cheap, shiny new instruments from China, Romania, etc. Who would choose a beat-to-hell, century-old German instrument over a beautiful brand-new one which projects like a freakin' cannon? Well, now that these new imports have been here awhile, a lot of people may be deciding that they aren't all that, and the early 20thC German shop basses are looking alot better than they once did.

That is not to say that the German shop basses aren't without their own problems. They commonly need new bassbars and top inlays to perform properly, and often have excessive string lengths - a problem which can be very difficult to cure. But, at least you know what you are getting. If the top hasn't exploded yet, then it's unlikely to do so under your stewardship.

If you're shopping, just make yourself aware of the typical problems associated with these basses, and, naturally, if possible, take the bass to a shop unconnected to the seller for a look.

[arnoldschnitzer]

I have not seen a major increase in the U.S. price of German shop basses. For the last decade they have been selling for $6-12K, and still are. I have seen an increase in the price of higher-quality German-made basses, especially those which were made by a single luthier or a family (i.e., Hornsteiner, Lowendahl, etc.). In my opinion the prices for these have just become more realistic, especially when you compare their tone to French, English and Italian basses costing multiples of the German basses' price.

[Contranash]

I am in fact talking about the higher end German basses from the 19th century. Thank you for the clarification, arnold. Perhaps the association with the factory made Juzek-like basses has put a bad name to quality, non-factory German basses of those families you mentioned, and buyers and sellers alike are smartening up to the previous prejudice.

[Eric Hochberg]

Originally Posted by Contranash

Perhaps the association with the factory made Juzek-like basses has put a bad name to quality, non-factory German basses of those families you mentioned, and buyers and sellers alike are smartening up to the previous prejudice.

I wouldn't say Juzek basses are of bad quality or give a bad name to anything. Plenty of old ones are still around and in service. They can be very good pro level jazz basses and I bet some of the larger ones might do alright in a section. German instruments, in general, have always meant quality, AFAIK.