ROLEXROLEXROLEXROLEXROLEXROLEXROLEXROLEXROLEXROLEXROLEXROLEX
29 March 2020, 04:50 AM | #61 | |
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Rather good analysis, and I always tip my cap to a rational person. I would like to add that the tipping point that will break this market and lead to drastic price decreases will be reached when the collector starts to sell in order to raise cash. Think successful small business owner with 3-4 SS sport models but not a lot of savings and suddenly they're shut down and not generating income. They won't like it, but they'll pick a watch or two and do it. This will bring the average acquisition price down for the GM dealers and then they can start discounting the stock they already had, because they too will need to keep money flowing. The first wave of job losses was pretty much all retail/service sector. Those people weren't buying Rolexes much anyway, but the job losses will start accelerating from here and bite people higher up the food chain. Many closed businesses have retained management in the hopes they can start back up soon, but how long can that last with no money coming in? I'm fortunate to know only one person so far that has lost their job, which was in an office that did commercial real estate leasing. 3 of the 5 people managing all the leases and paperwork were let go yesterday, and this is in an area with relatively few cases of the virus. That story will be repeated many times in the coming weeks. |
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29 March 2020, 04:56 AM | #62 | |
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Go look at the daily deaths in Italy and Iran, which we thought were moderating, only to see new peaks yesterday. |
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29 March 2020, 05:04 AM | #63 |
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Isn’t that a bit of a contradiction in terms? “Price gouging” usually refers to raising prices on necessities (i.e. food, gas, hand sanitizer) at a time of crisis. I don’t think anyone would consider a $10,000 watch to be a necessity. Rolex itself “gouges” the consumer by selling their watches at a price that exceeds the cost of production by, I’m guessing, a factor of 10. They continue to “gouge” by charging $1,000 for service, though the actual cost of labour and materials is only a fraction of that. Luxury goods are not bought on a “value for money” principle.
Anyone who has studied economics will tell you that speculation is a natural phenomenon where demand is strong and supply is limited. It happens with real estate, antiquities, fine art, etc. I guess it’s also happening with Rolex, since demand is strong and Rolex is either unwilling or unable to increase supply, at least in the short run. It would be strange if a situation like that did NOT lead to speculation. |
29 March 2020, 05:05 AM | #64 | |
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29 March 2020, 05:11 AM | #65 |
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When folks talk about insane prices, please remember a sale is the meeting between a willing seller and buyer. As it will always be. My belief that anyone, including me, who
think they can predict future luxury item prices, including Rolex, any better than they can forecast the stock market, is playing a losing game. |
29 March 2020, 05:15 AM | #66 | |
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I know many people who are not affected by what is going on in the world financially. Prices are not dropping on EBay.What EBay are you looking at?Daytona,blro’s,hulks etc are the same prices.i have just sold a hulk for 12k and there were many people willing to buy. |
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29 March 2020, 05:17 AM | #67 | |
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Although I agree, they are unlikely to treat themselves to a new Rolex anytime soon, especially if new Rolex stock become available and FOMO recedes |
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29 March 2020, 05:22 AM | #68 |
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29 March 2020, 05:24 AM | #69 | |
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29 March 2020, 05:30 AM | #70 | |
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+1 Sent from my iPhone using Tapatalk |
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29 March 2020, 05:30 AM | #71 | |
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And also, unless a person or a business have treated you badly, it says a lot about a person to hope of someone’s else demise - it is absolutely possible to hope for prices to go back down, without anybody’s business going under. But then again - I remember one of your earlier posts, where you didn’t really mind some people suffering if it meant that you could get your Sky-Dweller quicker, so not really surprised. |
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29 March 2020, 05:31 AM | #72 |
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29 March 2020, 05:35 AM | #73 | |
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29 March 2020, 05:36 AM | #74 |
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Which is my point exactly in the post that he is quoting - nobody knows if this is long term, and if it is, how long term.
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29 March 2020, 05:37 AM | #75 | |
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29 March 2020, 05:40 AM | #76 | |
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"Advertised" prices will remain similar. However, if someone asks 18k for a watch, I would bet a fair amount that they would let that watch go for 3-4k less and perhaps more than that in the coming weeks and months. Folks need to understand that the gray market cannot start reducing prices, that would create a chain reaction creating a massive spiral downward of prices resulting in massive losses for them. Thus, the advertised prices will continue to remain the same or maybe slightly lower, but the negotiation range will start to expand from perhaps a hundred or so to the several thousands and soon. AP and PP are also not rare or hard to get, they suffer from the same dynamic that rolex does, a pinched supply. Something is not rare or hard to get if it can be found "somewhere", just because the AD's cant or wont sell them does not make them rare. Picasso pieces are rare, see they will never be made again, PP and AP are not rare, anyone can have them delivered to their door in 2 days time (well before corona). |
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29 March 2020, 05:50 AM | #77 |
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Why assume the greys would just stop buying? Why wouldn’t they just average down by paying less? I’m not seeing how everything will become so readily available. Yes demand will decrease for a while, but I still think there will be a hierarchy as to whom gets offered certain models. Maybe I’m wrong though.
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29 March 2020, 06:15 AM | #78 |
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Thanks for all the input guys
My original question however has been completely ignored LOL My question was: brands like AP and PP dont seem to be affected by oversupply in the grey market, is it because they all get sold quicker? If not, then why?
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29 March 2020, 06:19 AM | #79 |
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29 March 2020, 06:22 AM | #80 |
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Keep in mind how small Patek is, maybe only 50 to 60k annual units. PP has purposely constrained stainless watches as they think it devalues their core PM watches, where Rolex’s core is the stainless models. The price of PP 5167’s appears to have come down. I can not speak to their other models, my wife and I liquidated our Patek’s in the last year.
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29 March 2020, 07:26 AM | #81 |
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I contributed to this discussion, but it feels lately beating a dead horse. Prices will go down, that's clear - but is our purchasing power will stay the same? Are you going to be able to walk into an AD 2 months from now and buy a Daytona knowing that you buy for yourself and just by wearing it, the price will go 20-30% bellow MSRP?
Because this is the norm for most luxury items, they do not appreciate in value. So you go and buy a BMW or you lease for facilitating even more the discussion. You know exactly how much it depreciates in 3 or 4 years, and then you move on. The real question now is - if you know, that your watch will not go in value, and you can buy anything on MSRP from your AD - what are you going to buy for your own pleasure? |
29 March 2020, 07:33 AM | #82 |
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Rolex releases an all blue Smurf Submariner in steel. Let the triple MSRP price games begin!
Sorry. Overall, decide what watch you really want to wear, what price you are comfortable paying, and focus on that and enjoy the watch if you get it. If you aren't a speculator, who cares? |
29 March 2020, 08:01 AM | #83 | |
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BLRO for sale from legitsellers on TRF: 7/9/18: $20250 (“unworn”) Today: $16595 (“BNIB”) Who was saying prices haven’t dropped? Sent from my iPhone using Tapatalk |
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29 March 2020, 08:12 AM | #84 |
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This is not 2008/2009. Us economy is solid. Economy/stocks/Rolex Prices will come down the coming weeks/months but will recover with full force once people can be treated and stop dying. The smartest people in the world are working on this together, corona virus has no chance:)
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29 March 2020, 08:15 AM | #85 | |
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29 March 2020, 08:16 AM | #86 |
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One thing I've never understood about the new with stickers grey market... There has to be certain ADs making a kick back on the watch they sell at MSRP. So in essence the AD is making money twice.
All the seemingly "honest" ADs I've spoken with have always wanted more stock to sell to legit customers. They try and not sell to those simply flipping. And they actually test you out a bit to see your intent. It seems there must be a few selling to grey dealers and getting an old fashioned envelop with cash at the end of the month? |
29 March 2020, 08:26 AM | #87 |
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The "instant Gratification" mindset is quite staggering ...
it's been what, two weeks? Many still in the 'Denial' stage of grief - of course very few people are desperate to sell after 2 weeks... that's an average vacation . what happens after 4 weeks? 6 weeks? What happens after Denial, and Anger... Bargaining Those stating that the prices have not come down have an unrealistic expectation to how long it takes for something to evolve... the virus itself may take 14 days to incubate... why would anyone expect the sky to be falling right now? I think that the prices are inevitably going to come down to MSRP - or below.. It is impossible for them to sustain, and this was something we were saying before a global pandemic crippled world economies... Demand will go down - partly because of lost disposable income, and partly because some watch buyers will be dead, and possibly a big part is that the casual watch buyer, even with money in his pocket, may have a different set of priorities for the next year or so until amnesia sets in... it will be no fun to show off your Rolex to people who have lost their jobs/houses/loved ones... There are very few things in this world that are absolute guarantees... but the lack of sustainability in asking $18k for a $9k watch is one of them... but I suppose there were guys who thought tulips and beanie babies were a safe investment as well...
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29 March 2020, 08:37 AM | #88 | |
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An expert at “pep talks”
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29 March 2020, 09:19 AM | #89 | |
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future of watch market
Excellent write up. Very well put.
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29 March 2020, 10:02 AM | #90 | |
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