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Insider: A Black Lotus is Rolls-Royce You Can’t Drive

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The Tale of Karakas

Once upon a time and a long time ago, there was an unhappy little Karakas that lived in Brian's Trade binder alongside his ten identical brothers and sisters. These Karakas were unhappy because they were only worth about $6 a piece and nobody wanted to trade for them.

Then one day a magical wizard came along and decreed that all Karakases were now worth $75 a piece. The very next day the wonderful King of Buylist was willing to pay $45 for those previously unwanted Karakas. Life was suddenly great and Karakas was the belle of the ball and everybody lived happily ever after in the land of MTG Finance.

I used to pick up Karakas and a handful of other old cards that were relatively inexpensive back in the day because they were mainstays in some of the random casual competitive formats my friends and I played. I would invent formats and encourage my friends to play and so I'd have bunches of extra copies of random cards to trade, lend, or even just give away. I probably gave away ten copies of Karakas over the years.


Sure, there was some new demand for the card that hadn't been there before in the form of Legacy Death and Taxes, but it doesn't feel correct to me to say the price increase was driven by "buyer demand" for Karakas. It wasn't like tens of thousands of people were suddenly all trying to build Death and Taxes at the same time.

In fact, the deck had some small success but still had that "rogue status" thing going on where people barely knew what it was. You'd ask somebody if they had a good Death and Taxes match up and they'd say, "That weird White Weenie deck? I have Swords to Plowshares, so I'm probably favored." Nobody had a clue.

The spike was not demand-driven. In fact, I'm pretty sure the popularity of the deck stemmed from the people's curious fascination with why the price of Karakas had just gone up by ten times!

Veblen is Nelbev Backwards

In economics Veblen goods are types of material commodities for which the demand is proportional to its high price, which is an apparent contradiction of the law of demand; Veblen goods also are commodities that function as positional goods. Veblen goods are types of luxury goods, such as expensive wines, jewelry, fashion-designer handbags, and luxury cars, which are in demand because of the high prices asked for them. The high price makes the goods desirable as symbols of the buyer's high social status, by way of conspicuous consumption and conspicuous leisure; conversely, a decrease of the prices of Veblen goods would decrease demand for the products.

- John C. Wood (1993). Thorstein Veblen: Critical Assessments. Psychology Press

Basically, that is a book-nerd way of explaining why rich people desire expensive things to demonstrate how they have enough money to purchase said fancy things.

There is a considerable amount of this going on in collectibles. It may not be to the same degree as a fancy Rolls-Royce, but then again did you hear about that $1,000,000+ Graded Alpha Set?

The fact of the matter is that people didn't want my Karakas when they had the chance to buy them cheap. If somebody had actually wanted Karakas to play with I would have literally given them away. However, nobody actually wanted to play with Karakas; people just wanted to have it because it was expensive.

People didn't want it when it was cheap but when you jack the price up ten times suddenly it becomes a very desirable item.

Once upon a time at Gen Con 2003, a good friend of mine traded me a The Tabernacle at Pendrell Vale for $2.50 to buy an over-priced convention Coca Cola. It was unclear at the time who had gotten the better end of the deal.


I know food and drink is ridiculously expensive at Gen Con these days but I still think I got the better half looking back.

I would also argue that the price of Tabernacle has very little to do with anything other than the Veblen effect. Sure, there are people who want it to build Lands or Commander decks or whatever, but not so many people that the law of supply and demand would dictate that $1350 was an appropriate price tag.

The fact that The Tabernacle at Pendrell Vale has become a highly desirable and coveted object because it is so expensive is what justifies the rising price of the card. Reserved List card or not, the most attractive quality of The Tabernacle at Pendrell Vale is specifically that it is very expensive.

Tabernacle isn't even particularly great (there are hundreds of cards that are better) or particularly iconic like Moxen, Lotus, or duals (the card was a junk rare, i.e. traded at the approximate value of a Coke) but it has amassed this ridiculous price tag.

The primary market for this card are individuals who want to have ridiculous collections of valuable and desirable cards. Having a binder full of cards like The Tabernacle at Pendrell Vale, Moxen, and Beta duals is the Magic equivalent of buying a luxury car or expensive 1st Edition Book. The objective is for people to see you having the expensive thing.

When the Levee Breaks

There are a bunch of copies of Moat available for purchase on the internet for $3oo and nobody wants them. So, a guy decides that he will buy up all of the Moats that nobody wants and then change the price to $500 so that everybody will now want them.

It sounds kind of insane, right?

If nobody wanted these cards for $300 why would anybody be compelled to pay $500 now? The price going up made the object more exclusive which made it more desirable. The ends justify the means in this case.

I wish so bad that Wizards would just say, "to heck with our policy---Moat is the next GP Promo" just to spite that guy and leave him holding the bag on all those Moats. The fact is that he'll make a lot of money because raising the price just makes people want it more.

The price increase only hurts the few people who want to play with Moat in a tournament, because they likely won't buy it and thus won't be able to play with it. The Veblen people don't care because they only want it because it is uber expensive; the people selling it don't care because they get more money; and Wizards doesn't care because it has nothing to do with selling packs or product.

Once upon a time there was a Reserved List...

I've heard this one a million times and frankly it is getting old. It is a bad story.

In my opinion, the joke is that we would have gotten these high prices with or without the Reserved List and with or without reprints.

Alpha Shivan Dragon is $1000.00. Shivan has been reprinted about a dozen times. Tell me again how reprints would tank the prices of old collectible MTG singles.

I would be lying if I said that there wasn't real demand for the Reserved List cards because there certainly is. However, I think the overwhelming desire for these cards can be attributed to the Veblen principle.


The desire for this card is purely because it is expensive. The card is basically only legal in Vintage and the Kitchen Table for actual play. The population of people who play Vintage is microscopic in the scheme of Magic. Yes, everybody wants one because it is cool and iconic and famous too, but how much of that iconicness, famousness, etc. is based on the fact that it has always been the most expensive card?

99.9%? I may be aiming a bit low.


Did you catch the massive buyout on Contract from Below that spiked the card up to $20.00? I guess somebody figured out that Reserved List + most powerful card ever made + weird gambling clause = extremely insane collectible.

Okay, so I made that up. But, tell me that when I said Contract was $20.00 that you didn't kind of want one.

I thought it was a pretty decent example because based on those criteria $20.00 Contract from Below kind of sounds slightly believable.

It's not like I said something completely ridiculous and unbelievable like $5.o0 Narwhal from Homelands!


The demand has very little to do with people needing the cards to play the game and a lot to do with people wanting to collect things they perceive as rare and valuable. Never underestimate people's desire to collect things they find appealing, iconic or nostalgic.

Alright, good talk. I'm going to go play PokemonGo for a while. Cheers, Brian.

8 thoughts on “Insider: A Black Lotus is Rolls-Royce You Can’t Drive

  1. One of my fave articles from QS in a while. Love when our writers use real-world Econ terms to explain phenomena in MTG.

    Also, when the hell did Narwhal become a card worth money??!!

    1. Narwhal was recently bought out by YouTuber who does Finance articles, as an experiment. They were curious if an entirely random and completely unplayed RL card from an ignored set would move the market.

      Sadly, it appears to have worked, considering the buyin was .50c….

    2. Thanks! It was a fun article to write. It’s always cool when you come up with an idea that is kind of novel and can have a little bit of fun writing it. 🙂

  2. Great article. Had never stopped to think that there isnt enough demand to keep those cards expensive, other than the fact that they are already expensive.

  3. Narwhal was recently bought out by YouTuber who does Finance articles, as an experiment. They were curious if an entirely random and completely unplayed RL card from an ignored set would move the market.

    Sadly, it appears to have worked, considering the buyin was .50c….

    I enjoyed the article. However, I don’t entirely agree that MTG cards are Veblen. Alpha cards are expensive because of collectibility matched with microscopic supply. However, that doesn’t mean they’ve become more attractive due the their increasing price. I think the growing demand for matching has created increased demand for these collectibles, hence the price continuing to rise.

    If Moat was in demand due to it’s higher price…people would be paying the higher price. They’re not. The higher price is actually deterring consumers, not cultivating or inciting demand.

    TL;DR – I’m not sure demand increases for rare/collectible cards as their price increases, which is a fundamental tenant of Veblen-seeking.

    Thoroughly enjoyed the alternate perspective, though! Thanks for sharing.

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