A different perspective

[rockysw]

So I was thinking what if the financial crisis actually end up becoming a uplift for the watch market.

Well first of all, i am one of those people who do want the watch market to crash. Things have gone crazy in the last few years, we all know about it so I wont dwell on it.

My thought process is that a lot of investments these days are virtual (for lack of better word) such as bonds, equites etc. And in an environment where it seems they might crash or at least go down in value significantly people may want to invest or hold on to physical assets.

Watches are real physical assets in your hand and there is no doubt that there is very large demand for them. Just like gold or other precious metals. Whilst values for these assets go up or down, they do remain valuable in most situations.

Now I am not saying that this will happen for all watches but could be a possibility for real hard to find watches or very high demand watches.

Just a perspective I wanted to share.

[Roger Lococco]

I think that it’s far more likely watches are once again viewed as depreciating assets that are purchased for retail or less…


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[Tim Plains]

How is this a different perspective? Seems like the same thoughts shared by many who were enthusiasts before covid spike.

I've only been into watches for a year now but it seems those hard to get models were hard to get years before the pandemic, so I can't see it happening any time soon, nor will ADs help towards that outcome because they sell a lot of product to those willing to spend for a chance at a popular Rolex at MSRP. My guess is those Daytonas, GMTs, and possibly Submariners will always be kept in the back and only go to preferred customers.

[dmash]

Originally Posted by Tim Plains

I've only been into watches for a year now.

Correct, as none of what you listed aside from a Daytona was ever hard to obtain.

[Son Goku]

Originally Posted by Tim Plains

How is this a different perspective? Seems like the same thoughts shared by many who were enthusiasts before covid spike.

I've only been into watches for a year now but it seems those hard to get models were hard to get years before the pandemic, so I can't see it happening any time soon, nor will ADs help towards that outcome because they sell a lot of product to those willing to spend for a chance at a popular Rolex at MSRP. My guess is those Daytonas, GMTs, and possibly Submariners will always be kept in the back and only go to preferred customers.

The only watch that was hard to get was a Daytona and it wasn't anything close to what it is today. Subs and GMTs were all readily available and at a discount on the secondary market.

[Tim Plains]

Originally Posted by Son Goku

The only watch that was hard to get was a Daytona and it wasn't anything close to what it is today. Subs and GMTs were all readily available and at a discount on the secondary market.

Really? Unless I'm off, there have been several posts here that GMT/Submariner stock started drying up circa 2016/2017 selling above MSRP.

[dmash]

Originally Posted by Tim Plains

Really? Unless I'm off, there have been several posts here that GMT/Submariner stock started drying up circa 2016/2017 selling above MSRP.

Again, wrong. You know what you could do ca '16-17? Buy a brand new Sub or GMT from tons of grey for 10-20% off.

[Tim Plains]

Originally Posted by dmash

Again, wrong. You know what you could do ca '16-17? Buy a brand new Sub or GMT from tons of grey for 10-20% off.

You say I'm incorrect and yet here are more posts, made today, mentioning GMT difficulty around 2017.
https://www.rolexforums.com/showthread.php?t=875178

Originally Posted by Laostuh

Bought my black GMT in 2017 $7500 out the door brand new from AD. I got lucky. Walked right in and was out within minutes.

That is really good. There are always good luck stories here and there.

[Laostuh]

Originally Posted by Tim Plains

Really? Unless I'm off, there have been several posts here that GMT/Submariner stock started drying up circa 2016/2017 selling above MSRP.

Bought my black GMT in 2017 $7500 out the door brand new from AD. I got lucky. Walked right in and was out within minutes.

[WatchGuy1966]

Wrong group to post this, bro.

[amphr1]

I think if it was inflation primarily and not job loss or housing bubble, you would be more likely to be correct. The news was just showing how the Chinese are buying up pre-own Rolex because of the financial depression. But you never know. I think anyone that tells you they know for sure is just guessing as much as the next guy.

[Cru Jones]

For that to the be the case, the hype/frenzy around watches would need to continue. Seems unlikely in a downturn. But we shall see.

[alphadweller]

Buying luxury watches as a safe-haven is a gamble. I would just stick to wearing and enjoying them while investing in something else.

[brandrea]

Originally Posted by alphadweller

Buying luxury watches as a safe-haven is a gamble. I would just stick to wearing and enjoying them while investing in something else.

Exactly this ^^^

[Brian Page]

I'm content with what's in my collection right now. Not concerned or speculating.

[Mabak]

Originally Posted by Brian Page

I'm content with what's in my collection right now. Not concerned or speculating.

[Bizcut1]

FWIW, my collection has held its own through the past six months...in fact, up 30% overall...if you can believe Chrono 24....and you can't!

[Mathematoxic]

Will be hard to compare watches with gold, stocks, bonds or other financial instruments. Mainly because the people managing these instruments generates some sort of profit/income with these funds while a watch’s value is mainly hinged on their desirability and hence the willingness for someone to pay for it. So it’s highly dependent on the hype and We all know hype comes and goes. But it hardly stays forever.

[beshannon]

Originally Posted by rockysw

Well first of all, i am one of those people who do want the watch market to crash.

Why? Because you want to buy? And then you want what you bought to be worth less? No one wants disinflation that understands it.

Originally Posted by rockysw

Watches are real physical assets in your hand and there is no doubt that there is very large demand for them. Just like gold or other precious metals. Whilst values for these assets go up or down, they do remain valuable in most situations.

Ask people that have bought Tag, Hublot, Breitling and IWC how they feel about value

[Robf52]

Originally Posted by beshannon

Why? Because you want to buy? And then you want what you bought to be worth less? No one wants disinflation that understands it.

This. Disinflation/deflation is a death spiral. Also, I think in the event of a severe worldwide economic downturn watch values will fall with everything else.

[Pop Art Suzy]

Originally Posted by beshannon

Ask people that have bought Tag, Hublot, Breitling and IWC how they feel about value

I can confirm this statement. My first watch was my TAG, and I paid $1300 for it brand new in 2000. Now it sells for about $300-400 on eBay, if you're lucky enough to get that much. I don't remember the model, but it's ss and looks like a typical dive watch. I still have it because I love it and wear it on the weekends. Still works, too!

[nachopc]

Buy what you like and if value goes up congratulations! Remember that like any other assets you only loose if you sell on the wrong moment. Ask stock market now !


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[eespi003]

Originally Posted by nachopc

Buy what you like and if value goes up congratulations! Remember that like any other assets you only loose if you sell on the wrong moment. Ask stock market now !


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I totally agree with this guy.

[mountainjogger]

OP, I think your reasoning is questionable. The recent demand for watches was fueled in part by the fact that people had disposable income to spend. If that reverses, I do not think people will flock to watches as a substitute for gold.

I also question wanting the watch market to crash as opposed to correct. I have no desire to see people standing in bread lines so I can get a great deal on a watch.

[Easy E]

Originally Posted by mountainjogger

OP, I think your reasoning is questionable. The recent demand for watches was fueled in part by the fact that people had disposable income to spend. If that reverses, I do not think people will flock to watches as a substitute for gold.

I also question wanting the watch market to crash as opposed to correct. I have no desire to see people standing in bread lines so I can get a great deal on a watch.

Agreed

[rockysw]

Originally Posted by mountainjogger

I also question wanting the watch market to crash as opposed to correct. I have no desire to see people standing in bread lines so I can get a great deal on a watch.

I didnt mean that by a watch market crash. Needless to say that watches are at the end of the day are nothing but unnecessary items and by no means i (or anyone else for that matter) would want a global financial crisis just so they can get a good deal on a watch.

It was a poor choice of words. I simply meant that I do want us to come out of what ever is going on with a more normal watch market where obtaining watches is easy and the hobby is fun.

[joa]

Originally Posted by rockysw

I didnt mean that by a watch market crash. Needless to say that watches are at the end of the day are nothing but unnecessary items and by no means i (or anyone else for that matter) would want a global financial crisis just so they can get a good deal on a watch.

It was a poor choice of words. I simply meant that I do want us to come out of what ever is going on with a more normal watch market where obtaining watches is easy and the hobby is fun.

if you are only interested in the beauty of mechanical watches you REALLY don't have to go into Rolex for that.

you can go ahead and collect Seikos, Tag Heuers, Longines and many other fine watches, as well as older (smaller) vintage watches from the top brands.

or..could it be that maybe, just maybe, Rolex is actually a Veblen good and you simply want what is hard to get? (i will volunteer here that i probably fall into that category myself)

If that's the case, don't hope for a correction, b/c you might suddenly not be so interested in them anymore if their prices go down

[rockysw]

Originally Posted by joa

if you are only interested in the beauty of mechanical watches you REALLY don't have to go into Rolex for that.

you can go ahead and collect Seikos, Tag Heuers, Longines and many other fine watches, as well as older (smaller) vintage watches from the top brands.

or..could it be that maybe, just maybe, Rolex is actually a Veblen good and you simply want what is hard to get? (i will volunteer here that i probably fall into that category myself)

If that's the case, don't hope for a correction, b/c you might suddenly not be so interested in them anymore if their prices go down

My view is that even if I or someone else for that matter want to buy watches for beauty of mechanical watches, why shouldnt I buy rolex along with the other brands? Rolex is a great brand and I would like to buy it along with other brands. As a consumer I want all options on the table.

On a side note, I am quite heavily invested in pre-owned rolex, so a proper market correction will result in a significant loss for me. But I still want it corrected simply because I like watches and I want watches to be available. But we are really side tracking here. The topic was one something else. :D

[Ichiran]

There are different views as to whether watches are investment but I think it has evolved into something else with social media. It is not uncommon to see 20-year-olds flexing in their IG with their Patek/AP/Rolex and I'm sure this has knock-on effect on other kids and IG users. Social media won't go away and this will be the new norm.

[JSolution]

I think a percentage of the watch market is the capability to hide , transport and launder money to be honest with you.