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Making money from monikers
By Timothy Appleby

Abandon the present - especially all that overpriced contemporary art - and forget about futures, pork-bellied or otherwise. Up in the rarefied air of Beverly Hills, Joseph Maddalena is making a killing with a vision rooted firmly in the past.

He and his 11 employees turn over an annual $12-million to $15-million worth of aging manuscripts and documents that have one thing in common: they have been autographed by history's rich and famous.

From Henry VIII to Jim Morrison, from Rasputin to Beatrix Potter, Babe Ruth to James Dean, all are grist to the mill of Profiles in History, whose parchment decorated premises are visited by appointment only.

Padding around the elegant, functional office, as vintage rock n' roll plays softly in the background, the 37-year-old Mr. Maddalena with his pony tail, stubble and work boots doesn't look especially prosperous or like much of a history epicure.

And yet he says business has doubled in each of the firm's nine years of sales. "I don't want to get any bigger. We're the largest autograph dealers in the world and we can only handle so much. If I can't spend time with my clients, it's no fun for me and no fun for them."

An odd statement, given his company's shrewd decision recently to advertise in The Economist, the upscale business and politics magazine read around the world. "The phone's been ringing off the hook because of those ads," says the firm's jeans-clad marketing agent, Maggie Leatherman.
In the past decade, says Mr. Maddalena, the number of serious autograph collectors in the United Sates has grown tenfold to about 20,000. (He says his clientele also includes a couple of hundred Canadians.)

The company has a core stable of about 500 hot signatures, and gathers its material (which it authenticates) from a range of sources: auctions across North America and abroad, other dealers and ads placed in publications.

Its greatest demand is for relics of U.S. political history especially anything written or signed by Abraham Lincoln and price, of course, reflects supply.
Prolific signers are less valuable than occasional scribblers, which makes Edgar Allan Poe and Herman Melville surprisingly expensive because they left hardly anything behind.

As, it seems, did Richard Nixon. "In the last couple of weeks, we've sold everything we've got," says Mr. Maddalena. "A handwritten letter from him as president would be worth $25,000 to $35,000 even a thank-you letter, because they're very, very rare."
Napolean, on the other hand, cranked out about half a million letters, meaning you can buy one for $2,000 or so. Elvis Presley is another bargain $1,500 for a signed mid-1950s photo, when he was in his prime.

More important, however, is context. A simple Abe Lincoln signature clipped from a letter starts at around $4,500. Attached to a document, it rises to $10,000. But for a good-quality letter in which he discusses slavery, prepare to pay $1-million or more. Marilyn Monroe's autograph at $3,000 while a signed letter will fetch up to $50,000, "depending on what she had to say."

Some inquirers go away disappointed because there are categories that Profiles in History won't touch: serial killers and Nazis, for example. Al Capone, on the other hand, makes it because of his unique place in U.S. history; his circular, surprisingly neat signature will cost you around $7,500. Also acceptable is Erwin Rommel ($1,000), sole exception to the no-Nazis rule on the grounds that he was primarily a military figure.

As with ocean-front lots, the salient quality of historic documents seems to be that nobody makes them any more, and the available read affordable inventory is rapidly shrinking.

"Light bulbs are going off in people's heads," Mr. Maddalena says. "This material is grossly undervalued compared to the fine-arts market, and much more stable."

Weighed against the price of some art at least here on the West Coast that may be true. A letter written by George Washington, for example, costs $50,000, a mere pittance in some art galleries. Put another way, the signatures of Washington, Lincoln, and Thomas Jefferson combined are worth about the same as a signed Andy Warhol lithograph: around $17,000.

And over the long term, historical material has outperformed more traditional investments.
Last year, to demonstrate the investment appeal of its merchandise, Profiles in History pieced together the fiscal track record of its 15 most popular characters since 1970. Their average annual rate of return turned out to be a healthy 13.2 per cent.

"It has a lot of liquidity I could get my money out in 30 days or less," says Kansas City pharmaceutical supplier Claude Harkins, who started dabbling in autographs 50 years ago when, at the age of 12, he wrote to General George Patton in Germany and received a signed reply.
Mr. Harkins sold off all his collections to help finance his company, began collecting again eight years ago, and reckons the $700,000 he has spent since then on some 250 items that lie under Plexiglass in a bank vault has now grown to about $2.5 million.

The great joy of autograph trade, he says, is in combining a solid investment with something that's esthetically pleasing.
"Who cares whether you've got a certificate of deposit? Or a stock certificate. I've always loved American history, and I just like to know that I own a letter written by George Washington during the Revolutionary War, and know that he held it himself."

Perhaps, but an investment is an investment, and Peter Beal, chief English-language manuscript expert at Sotheby's in London, confirms that "really important documents hold their own and rise considerably sometimes."

However, he stresses the distinction between what is historically significant and what is not. A dinner invitation written by the wife of a lesser-known president, for instance, may be interesting, but no more than that.

"If you buy at the top of the market it's pretty sound," he says. "We had a letter by Charlotte Bronte for example, sending the manuscript of Jane Eyre to her publisher. From a few thousand pounds, it went to £20,000 and it was recently sold from more than £60,000. That was over a decade."
Mr. Beal dismisses "miscellaneous stuff that's not of intrinsic importance," which explains Mr. Maddalena's utter lack of interest in Madonna, Wayne Gretzky and other present-day headliners: their autographs are as ubiquitous as they are.

Occasionally, a signature will drop in value. Alfred Lord Tennyson has faded in popularity lately, as have Leon Trotsky, Mao Tsctung, and other Communist leaders.

Dead pop stars, by contrast just seem to rock on.

"Sad to say, when they die young they're worth more," Mr. Maddalena says. "And some people have the same passion for Jimi Hendrix lyrics that others do for the Gettysburg Address. A Hendrix signature might be worth a thousand bucks. But the handwritten lyrics to Purple Haze? A hundred grand, just like that."
Given that Mr. Maddalena's clientele includes Canadians, what about his inventory?
"The English that governed Canada, such as Queen Victoria, do you consider them Canadian? No? Then we don't. Not that I can think of."