Bubble or new normal?

[Craigdwh]

Good God, some of you guys sound like the Fake News.

Words like catastrophe, market crash are loosely used or you don't know the definition.

What we experienced in 08/09 was a crash and we have not been able to forget about it. We have been transfixed on it, scared about when it's going to happen again.

We are not going to experience a crash, a correction? Yes, maybe, most likely. A recession, yes, maybe more likely.

But not a crash or market catastrophe.

[beshannon]

Originally Posted by Craigdwh

Good God, some of you guys sound like the Fake News.

Words like catastrophe, market crash are loosely used or you don't know the definition.

What we experienced in 08/09 was a crash and we have not been able to forget about it. We have been transfixed on it, scared about when it's going to happen again.

We are not going to experience a crash, a correction? Yes, maybe, most likely. A recession, yes, maybe more likely.

But not a crash or market catastrophe.

Many here have lost their perspective.

This used to be a watch forum not a speculator's paradise

[77T]

There have been bubbles in the past that imploded - can’t understand why some think it can’t happen again.

1987 - Flash Crash by trading programs on Oct. 19 without human intervention or circuit breakers. Program traders took much of the blame for the crash, which halted the next day. The true cause may never be known, conspiracy theorists still believe it was a state-sponsored financial attack. Just as mysteriously, the market climbed back up towards the highs it had just plunged from.

2000 - Dot Com Crash by inflated valuations set on forward earnings by internet companies that were money losers. Ultimately this had boosted values over the preceding 5 years.

2008 - Housing Market Crash by manipulated mortgage originations, false real estate values and derivatives. We all should still remember that.

Read: https://www.investopedia.com/feature...s/crashes8.asp


My point is that saying it won’t happen again is not appreciating the risks.


Sent from my iPhone using Tapatalk Pro

[HK Islandboy]

Originally Posted by XZACM1001

Rolex is limiting supply for the same reason. The worst thing is to have inventory out there when the bubble bursts.

Absolutely agree. They are playing the long game and foregoing a few sales these years is a small price to pay to maintain the value of the brand when the decline in demand comes

[penguinrolex]

New normal. Prices on some models will dip down, but the 'hot' models will continue to be 30-100% markup. Limited editions (Harrods Tudor, Omega ultraman) and hot models (pepsi, daytona C, the next care bear watch) will be snapped up before you or I can touch them.
Because they can.

No matter how many Rolex/PP/Omega cranks out, the demand for something cool will always be more than what the local AD can supply. There are so many small speculators that they can afford to snap up ALL the hot inventory, to resell.

Grey market is primarily people with jewelry resale experience. They understand "buy low, sell high, don't undercut the competitor or they will undercut you." These people are comfortable holding valuable inventory months to years to get a better annualized return on their inventory.
The ADs goal is to sell their inventory asap, to increase their revenue and their inventory turn. The salesperson is incented to do this and so is the manager, especially at chain locations. Rolex sales lead goal is to get the AD to take as much product as possible on the shortest credit terms ever. You as a consumer have no reliable information about the actual demand or actual supply that anyone is holding, you (I?) only see that the AD never has inventory and the grey market vendors only offer one at a time. These incentives all line up to - if you want a Rolex, go to your local jeweler because his grey market display is the only full case in town.

Until a watch manufacture changes their channel and the incentives and the information disparity, the market is going to move watches towards grey. Even if there is a bubble, the supply will continue to APPEAR to be inadequate and those who can afford will still pay too much.
Remember car shopping, before the internet? You paid MSRP or MSRP plus a few grand. Now, you pay 3% over invoice. Unless it's a hot new model and then you pay MSRP plus 5k.

[watchwatcher]

People who live outside of the boundaries of reality will forever be prey to the whims of whatever happens in the watch, housing, or stock markets. My take, anyway.

Anyway, as to the OP's question. I think it doesn't really matter what you call the state of things nowadays. We all deal with the difficult times the best we can and life goes on. Interestingly enough, some of the policies and strategies that are in play today actually increase the value of the watches we're all wearing, but are some of the most complained about subjects on this forum. Huh...go figure.

In 2008, in the midst of dire times and all the gloom and doom, I bought a few watches. In 2018, I think I'm gonna buy...yes, you guessed it. A few more watches.

[R!$]

Originally Posted by bonovox

I've been a collector for some time now. I've never seen anything like what's going on now. Pepsi and Daytona prices on the secondary market to name a few (Patek 5711? Snoopy Silver Award?). What's your opinion? Are watch prices in general in a bubble?

What goes up, must come down

[idontlike_bandwagons]

The "bubble" will burst, but I doubt it will happen in near future. Actually I hope for a burst, just to get rid of the majority of pseudo enthusiasts and we can go back to focus on watchmaking instead of investment banking and the cry for brand recognition – booooooring!