In the mid-1990s, reasonable adults started hoarding plush toys like they were investing in Manhattan real estate. Ty Warner's Beanie Babies weren't just cute—they sparked one of the strangest speculative bubbles in modern history. People mortgaged houses, divorced over collections, and treated $5 stuffed animals like retirement funds.
Warner's genius wasn't the product itself—it was the artificial scarcity. He "retired" certain designs without warning, creating panic among collectors. That purple Princess Diana bear? People genuinely believed it would pay for their kids' college tuition. At the peak in 1999, Beanie Babies represented 10% of eBay's total sales. A single "Peanut the Royal Blue Elephant" supposedly sold for $5,000, though most of these legendary prices were likely fantasy.
The crash was swift and brutal. By 2000, basements full of Beanies became worthless overnight. Warner, meanwhile, became a billionaire—one of the few who actually profited from the craze. He later served jail time for tax evasion, hiding $100 million in Swiss banks. Today, those "rare" Beanies collecting dust in storage units are worth maybe $5 each, proving that a great marketing scheme beats intrinsic value every time. The real collector's item? The financial lesson about manufactured hype and irrational exuberance, served with a side of polyester beans.