In an equity market this

volatile, you need more than

just safe investments. You need

investments that make you feel

safe.

After years of vainly

foretelling the crash of the

Dow, financial doomsayers have

given up and turned their

attention to a real bear market

- the fevered trade in Beanie

Babies. Since the first signs of

Beaniemania in 1996, your money

pundits and collectibles experts

have been tripping over each

other to be the first to predict

that Doodle the Rooster, Flash

the Dolphin, Doby the Dog, and

Seamore the Seal would soon be

showing up in the 5-for-$1 milk

crate at your local garage sale.

Clearly they haven't heard about

the premium prices the new Eddie

the Izzard, Linda the Tripp, and

Billy Corgan the Incredibly

Annoying Millionaire lines have

been fetching at the Beanie Big

Board.

But few of the Beanie naysayers

have done their homework. Most

coverage has been pack

journalism about pack fandom -

tales of UPS drivers being

roughed up, green-eyed soccer

moms plundering their crying

brats' toy boxes, and slit wrists at

Beanie giveaway blood drives.

Most self-respecting Americans

want to see the Beanie

collectors punished just on

general principles and draw

easy analogies with the Cabbage

Patch craze or Star Wars-figures

bubble. What nobody questions is

whether these rarities are, in

fact, rare. Collectibles

commentator Harry L. Rinker, in

a recent stop-the-insanity plea,

urged Ty Inc. to "flood the

market" to give the addicts a

quick fix.

Of course, they already have.

The fact that Ty doesn't get any

credit for having long ago

drowned the heartland in fake

fur is largely the work of the

company's shadowy, visionary

owner Ty Warner. Like all truly

diabolical geniuses, Warner

maintains a Howard Hughesian

silence toward press and fans.

But the few market figures we

could grab through the company's

veil of secrecy don't bode well

for the market in stuffed

collectibles. Last year,

McDonald's alone moved more than

100 million dolls in its Teenie

Beanie Babies promotions. This

year another 200 million are

available with your Happy Meal.

According to the Toy

Manufacturers Association,

traditional plush toys (the

category that includes Beanie

Babies, but significantly,

doesn't include powerhouses like

Tickle Me Elmo and Sing 'N'

Snore Ernie) did US$955 million

in sales in 1997. Though it's

not clear how much of that was

attributable to Beanies, an

article in the June issue of

Playthings - the trade paper

that sounds like a strip club -

notes that toy retailers around

the country have found a demand

for "Beanie Babies, other Ty

plush, and not much else." And

that's not even counting the

point-of-purchase market at

Walgreens.

What we have is at least a

half-billion Beanie Babies on

the market and only 270 million

Americans to buy them, which

roughly adds up to either two

for everyone or two of each

variation for everybody who can

actually name them all. While

you may have a Britannia the

Bear listed at $885, the only

buyer who will really give a

crap about the condition of

Brit's toe tag or PATCH flag is

another Beanie collector, who of

course already has six copies of

any doll you're trying to sell.

(The worst Beanie tragedy we

could find with a self-imposed

five-minute search cap - other

than the inherent dramedy of the

Diana commemorative Beanie - was

a Royal Blue Peanut that got bid

up to $2,850, failing to meet the

seller's reserve.)

But Ty's legions of

get-richer-quicker groupies

still have a few cards up their

sleeves, including government

goons ready to enforce any

disrespect. "Many times, a

person's purchases are detained

by Customs. If we are convinced

[the illicit Beanies are] for

personal use and they are not

selling the product, then we

waive the detention," Ty

attorney James White said after

US trade representative Charlene

Barshefsky tried to smuggle 40

of the little pests out of

China. For taxpayers accustomed

to having the US Customs Service

employed at public expense

keeping pot away from cancer

patients and enforcing the

fabled "no joking" policy, this

kind of legal waiver from a

private company might come as a

surprise. But then, why

shouldn't Ty have protection in

enforcing the perceived rarity

of its products? After all, if

the dirt-common ordinariness of

diamonds were generally known,

DeBeers family heirs would be

working hosedown at the

boardwalk tilt-a-whirl. What

matters isn't whether the

commodity is really rare, or

whether the rarity is

manipulated; it only matters

that everybody thinks it's rare.

While sobersided

collector-haters openly hope the

Beanie bubble is headed for a

Dutch-style collapse, true

believers know that tulips on

your organ beat Roosevelt coins

on your piano every time.

Even warm and fuzzy rarities

don't necessarily sink in value

when their rarity disappears.

This month's switched baby

catastrophe didn't lose a step

when it was discovered that the

parents of one of the children,

Rebecca Chittum, were killed in

an accident shortly before the

switcheroo was discovered.

Plenty of babies to go around,

you'd expect - yet despite a

surplus of youngsters and a

dearth of parents, demand for

the little dolls hasn't dropped

an iota. And as any Beanie

collector can tell you, a real

baby isn't half as cute as a

furry, PVC-filled facsimile.

All those comic book collectors,

who in the early '90s stuffed

their closets with "collectors

edition" Death of Superman

issues that can now be bought

for less than a buck at Good

Will, may offer an ominous

precedent for Beaniemania. But

with almost all Beanie Babies

tucked away in closets and

safe-deposit boxes, a closer

analogy may be the NASDAQ

market. Since a typical IPO

float might consist of as little

as 15 percent of total shares

outstanding, the spectacular

price runups in the electronic

market, like exorbitant Beanie

prices, tend to be a matter of

the riffraff chasing a small

sliver of a hot commodity, while

the true hoarders keep the real

profit centers to themselves.

And the similarities don't end

there. As in the stock market,

the only real Beanie bargains

are found in the primary market

(Ty still makes all its dolls

available at a suggested retail

price of $5 each), where the

smart shoppers immediately turn

around and sell their wares at

huge markups to the suckers in

the secondary market.

But while Jane Bryant Quinn

might turn up her nose at people

who store up Kewpie dolls for

their future value (an issue of

Mary Beth's Beanie World

Magazine recently touted a

youngster's $36,000 Beanie

collection with a premonition

that the cuddly critters would

"someday pay for his college

education"), are the

Beaniemaniacs any more off-track

than the bargain hunters who

turned out after last week's

"market correction" to snap up

stocks that still had

price/earnings ratios of 40 - in

the belief they were getting

good deals? Indeed, we're going

to make our own market

prediction - that the

stuffed-sock fanatics, with

their hoard of hard assets, will

have the last laugh on all of us

when the "10,000 by 2000" bubble

really does pop. Think about it

- in a market sustained by

limitless belief, where

everything depends on your

fellow zealots' keeping the

faith, aren't the terabytes of

Mandarin brainpower on Wall

Street really a disadvantage?

Who do you think is going to see

through the market's crabbed

numerology sooner - a Goldman

Sachs MBA or some high school

music teacher who just scored a

fourth-generation Grunt the

Razorback for $200?

Nincompoopery may turn out to be

as good a new paradigm as any

other. With markets sustained by

the greater fool theory, you're

better off in a market that's

full of fools.