PSA: The Daytona costs about $12,000

[TheDude]

Originally Posted by dmash

of course this isn't a definitive fact......but excess, luxury purchases are certainly sold at (heavy) discounts during this time. These people are honestly living in cuckoo land who think that in a true recession, the 'hot' watches are still going to be pulling crazy premiums over MSRP lol. They'll be lucky to be anything over MSRP, and stuff like the basic Sub will go back to *under* MSRP.

The other dynamic that happens during recessions across the entire luxury segment is that pre-owned goods crash harder than new. The folks who can still afford it buy new (discount or no), and the guy who was stretching to afford luxury goods or someone who was enjoying some temporary but now-vanished success are out of the market. These guys accounted for a lot of used sales, leaving a large amount of second hand inventory that won’t move.


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[dmash]

Originally Posted by TheDude

The other dynamic that happens during recessions across the entire luxury segment is that pre-owned goods crash harder than new. The folks who can still afford it buy new (discount or no), and the guy who was stretching to afford luxury goods or someone who was enjoying some temporary but now-vanished success are out of the market. These guys accounted for a lot of used sales, leaving a large amount of second hand inventory that won’t move.


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Exactly. Just don't see how somebody can pay these prices when it's so blatantly obvious it will be coming back down (rapidly too). I mean, I guess if you're pushing quite the 6 figure salary, another $10k is nothing, but to someone like myself, that's a considerable sum and it's not a big deal to simply kick back and wait.

I'd never buy anything when everybody else is buying it, I'll buy it when nobody will buy it (at drastic discount)

[Bladeshot]

Originally Posted by Chadridv

I'll be keeping my watch long term... and crying

rofl...


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[superstarmar]

Originally Posted by prefontaine

And, during the next recession, you will be able to buy a brand new one for about $10,000.

This has been a public service announcement from your friendly local TRF economist.

Hah !!! Very nice pipe dream there ...
When you have a SS Daytona C to sell me for $10K or
Your local friendly neighborhood AD
You have a sure buyer ...

[904VT]

Originally Posted by dmash

It's like everybody wants to play economist on TRF but they want to ignore things that are so obviously in their face

Reminds me of the day traders of the 90's. It works until it doesn't. Throwing a dart at the old listings from the NYSE in the newspapers used to make you money too.

[prefontaine]

No one has taken me up on my wager!

[kultschar]

Originally Posted by prefontaine

No one has taken me up on my wager!

Im outside US so cant do the wine. How about 200 bucks.

Are we presuming from a trusted seller here?

[bruinmd]

Good read (nothing shocking) about what may be in our not so distant future:

https://www.yahoo.com/finance/news/p...203418073.html

[00Seven]

Agree 100%...just a matter of time. Probably a good indicator of an over-heated market in general when we see valuations of watches at current levels.

[Beckster]

Any of the older and more experienced guys who have been in this game for a long time can share their experience? I’m curious if you guys have seen through periods during downturns/recessions and actually seen prices of rolex watches, esp preowned and/or vintage crashing or going down.

[Vanslee]

I need help finding the best place to buy an affordable 16610 Rolex Submariner. Where should I look? In need of mentorship!

[oldman2005]

I was shopping for a SS Zenith during the last great recession of 2008 in US, I remembered the used SS Daytona has deep below the MSRP but not much, you could have new SS Daytona near MSRP. I missed a few deals on the A-serial SS Zenith Daytona so never got one, missed a perfect one sold at $14,000 :(

I'd save my watch money for the next recession as it has been 10 years from the last one.

Originally Posted by Beckster

Any of the older and more experienced guys who have been in this game for a long time can share their experience? I’m curious if you guys have seen through periods during downturns/recessions and actually seen prices of rolex watches, esp preowned and/or vintage crashing or going down.

[erickucla]

Originally Posted by RJRJRJ

It certainly may, but I doubt it will be before at least one price hike.

Agree with OP, the next recession will be short lived. A big house Jr will eventually hit; maybe due to massive defaults on student loans causing major disruption in the banking sector.

What was easier to get than a mortgage in 2007, and still is and will be? Student loans for Jon Smith online technical college in Montana.

[c41006]

Exactly why I won’t go near a SS pro model right now. It just doesn’t make sense. I don’t like to pay MSRP much less above it. 25% off original MSRP on a pre owned Rolex is where I feel comfortable buying.

[gccmd]

I got my first white SS Daytona 116520 in 2008 in the midst of the financial crisis. I left my name at an AD on a trip to Boston. I had never purchased anything from the dealer before. I was surprised to get a call from them offering me the watch a month or two later. I paid for it with my credit card on the spot. I was obviously lucky but it suggests to me that when the economy is not so hot the hard to get references do become more readily available.

[Bigsoftee]

My thoughts are this, and I am not an educated man so take it easy on me. But I genuinely feel we are due a major currency crash, which can only really be the EURO given Brexit and the internal problems facing the EU. I have been quietly buying physical gold (Hate taking long term positions with brokers, even though I am in then gambling industry) over the last 3 years. To me its a case of when, not if. Meltdown? No I don't think so, but I do feel it will be worse than the pair of Fannies that devastated the late 00's.

As for the luxury market if it happens, gone short to midterm. But as with most things it should rebound. But for me my passion of watches started with a Seiko Snoopy watch in the 70's, only as my disposable income has gone up has my ability to purchase more high end items has increased. If it does crash would I sell, no as I not over committed to what to me is a wonderful hobby I have enjoyed since I was a 5 year old. Would I sell the gold? Absolutely, and then have liquid to invest in a depressed market.

Would I buy watches in a depressed market? Now theres a question........

[Sandpit]

Originally Posted by erickucla

Agree with OP, the next recession will be short lived. A big house Jr will eventually hit; maybe due to massive defaults on student loans causing major disruption in the banking sector.

What was easier to get than a mortgage in 2007, and still is and will be? Student loans for Jon Smith online technical college in Montana.

Same in the UK. Virtually everybody that goes to Uni has to get a student loan. I’d say student debt must be a good £40 to £50k for a 3 year degree now. You have to earn above something like £25k to start paying back the loan.

On a slightly different note, according to the Telegraph the value of the UK housing market fell over the last year for the first time in 7 years. £1bn has been wiped out of the market. In the next few years there will also be an increasing number of interest only mortgages that will need to be settled. Things are starting to happen. I don’t know what’s happening in the US so can’t really comment. I do believe there is a huge asset bubble though at the moment. The vintage / collector car market has been in a bubble for a couple of years too and I believe the watch and car market would be closely linked.

[jcoltrane]

Originally Posted by prefontaine

Anyone want to take a wager?

Stakes: Bottle of wine valued between $200 and $300 shipped anywhere in the U.S. the winner specifies. Wine to be selected, purchased, and shipped by loser.

Wager: There will be a documented NIB Rolex Daytona Ceramic transaction between June 18, 2018 and June 18, 2023, for $11,000 net. (To allow that a qualifying deal might be taxed.) The watch must be NIB but need not be from an AD.

I’m happy to take that bet, because I’d be glad to buy another at that price. I’ll send you a bottle of Stag’s Leap Cask 23 if I’m wrong

[ronricks]

Originally Posted by Sandpit

Same in the UK. Virtually everybody that goes to Uni has to get a student loan. I’d say student debt must be a good £40 to £50k for a 3 year degree now. You have to earn above something like £25k to start paying back the loan.

On a slightly different note, according to the Telegraph the value of the UK housing market fell over the last year for the first time in 7 years. £1bn has been wiped out of the market. In the next few years there will also be an increasing number of interest only mortgages that will need to be settled. Things are starting to happen. I don’t know what’s happening in the US so can’t really comment. I do believe there is a huge asset bubble though at the moment. The vintage / collector car market has been in a bubble for a couple of years too and I believe the watch and car market would be closely linked.

In the US we have a lot of people that are part of 3 groups:

1. People who have an exorbitant amount of student loan debt
2. People who have an exorbitant amount of automobile loans (often 2 high car loans per household)
3. People who have BOTH high student loan debt and a high car payment.

Something has to give. Many people are already stopping paying or hoping for student loan forgiveness. Throw in credit card debt on top of the student loan and car payment and it is about to boil over.

I am making no predictions on the US economy but I do know the people in these groups can’t continue to pay on credit cards, student loans, and cars at once. They will (and are) picking one to drop all together. It is a scary proposition. I don’t think the next crash will be because of housing I think it will be brought on by student loans and car financing debt.

[Ruud Van Driver]

Originally Posted by SG56

Great post!

People don't realize that the economy has cycles.

I'm bad with economy, but if i remember one thing from the class, it's the cycles :)

Also worth noting, when it hits, will we all have jobs and have $10k to spare on a watch :D

Motorcycles don't count, T

[SG56]

Originally Posted by Ruud Van Driver

Motorcycles don't count, T

Hahahahahahahahahaha

[Rolex85]

Originally Posted by RobearH

I read of an AD in Florida that had one...but sadly now its for sale on TRF for $18995!!!

Sorry I missed the all jokes aside part.

[uniqueMR]

[tyler1980]

Originally Posted by prefontaine

And, during the next recession, you will be able to buy a brand new one for about $10,000.

This has been a public service announcement from your friendly local TRF economist.

at 10k its actually more expensive than 12k now or even the current secondary market price if everyones portfolio collapses so its not a "deal"

For the cost of the watch to fall that far, incomes and net worth will have to be falling proportionate to that as that is a huge, huge collapse. You are looking at the potential price of a watch in a vacuum and not taking into account other economic conditions that would also be occurring at the same time which would be the cause of the price decrease, and that would deal directly with affordability.

[jakeysrolex]

Originally Posted by rolexpatek363

Remember the 16600 Seadweller craze, and the green glass Milgauss craze....?

There’s a reason the media literally refers to the sheeple as “consumers”.


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[dmash]

Originally Posted by ronricks

In the US we have a lot of people that are part of 3 groups:

1. People who have an exorbitant amount of student loan debt
2. People who have an exorbitant amount of automobile loans (often 2 high car loans per household)
3. People who have BOTH high student loan debt and a high car payment.

Something has to give. Many people are already stopping paying or hoping for student loan forgiveness. Throw in credit card debt on top of the student loan and car payment and it is about to boil over.

I am making no predictions on the US economy but I do know the people in these groups can’t continue to pay on credit cards, student loans, and cars at once. They will (and are) picking one to drop all together. It is a scary proposition. I don’t think the next crash will be because of housing I think it will be brought on by student loans and car financing debt.

How ANYBODY can look sheer size of the student debt bubble, paired with the fact these are the people entering the workforce, and the basis of future society....and then claim 'there's no crash coming'.........is beyond me.


Also as a side note, LOL at how US charges interest on FEDERAL loans. Quite unbelievable honestly. 'Our Government will charge you interest for furthering education and trying to strengthen our society'. Only in America

[Rebel]

[Sandpit]

Originally Posted by dmash

How ANYBODY can look sheer size of the student debt bubble, paired with the fact these are the people entering the workforce, and the basis of future society....and then claim 'there's no crash coming'.........is beyond me.


Also as a side note, LOL at how US charges interest on FEDERAL loans. Quite unbelievable honestly. 'Our Government will charge you interest for furthering education and trying to strengthen our society'. Only in America

Out of interest what’s the average student debt these day?

I’d be interested how the Rolex graduation presents from parents would be affected. The amount of “my parents have given me $30k graduation Rollie ooohhhh yeaaahhhh” posts are just annoying.

[dmash]

Originally Posted by Sandpit

I’d be interested how the Rolex graduation presents from parents would be affected. The amount of “my parents have given me $30k graduation Rollie ooohhhh yeaaahhhh” posts are just annoying.

This annoys me to no end, but I mean, different strokes for different folks. I think it's a joke acting like going to school for 4 years makes one in any way deserving of a $10k Rolex, and sets up that individual's expectations in life to be quite disappointing. and I say that as a college graduate. Perhaps I just like to actually earn my belongings and not have them handed on a silver platter. Not to mention, I would NEVER take $10k of my parent's money for some tangible good, especially after they had to pay for my entire being for essentially 18 years. I would have told them to take that and go on a nice vacation.....I guess some people always are willing to take money from their parents?

Originally Posted by Sandpit

Out of interest what’s the average student debt these day?

Some figures:

-The average student loan debt after graduation is approx. $40,000/student.

-Total bubble is around 1.5 trillion at this point. 1.5 trillion....and this is encompassed not only of engineers, doctors, dentists, blah blah blah who have 100% ensured income post graduation. This figure is also composed of people who went for a Bachelor of Arts and didn't even graduate, and have absolutely NO way to pay back student debt making $12/hour.

-Well under 10% of the debt is in any way 'security backed', so defaulting to a lot of these people is a viable option.

-Something like 44million Americans have some type of student loan debt. More than 10% of the ENTIRE country, not just individuals in 20s and 30s, have student loan debt over their head.


And the above figures, grow exponentially each year, by as much as 10%. Absolutely no signs of slowing down.


Oh, and let's not even bring into consideration, that this is also paired with the fact of how Americans utilize credit moreso than practically every other country, and this year finally broke the 1trillion dollar threshold in total credit card debt.


I'm sure the future looks very bright though, and the millions and millions of 20-30 year olds carrying this kind of financial pressure will in no way affect the overall health of the economy

[Sandpit]

Originally Posted by dmash

This annoys me to no end, but I mean, different strokes for different folks. I think it's a joke acting like going to school for 4 years makes one in any way deserving of a $10k Rolex, and sets up that individual's expectations in life to be quite disappointing. and I say that as a college graduate. Perhaps I just like to actually earn my belongings and not have them handed on a silver platter.



Some figures:

-The average student loan debt after graduation is approx. $40,000.

-Total bubble is around 1.5 trillion at this point. 1.5 trillion....and this is encompassed not only of engineers, doctors, dentists, blah blah blah who have 100% ensured income post graduation. This figure is also composed of people who went for a Bachelor of Arts and didn't even graduate, and have absolutely NO way to pay back student debt making $12/hour.

-Well under 10% of the debt is in any way 'security backed', so defaulting to a lot of these people is a viable option.

-Something like 44million Americans have some type of student loan debt. More than 10% of the ENTIRE country, not just individuals in 20s and 30s, have student loan debt over their head.


And the above figures, grow exponentially each year, by as much as 10%. Absolutely no signs of slowing down.


Oh, and let's not even bring into consideration, that this is also paired with the fact of how Americans utilize credit moreso than practically every other country, and this year finally broke the 1trillion dollar threshold in total credit card debt.


I'm sure the future looks very bright though, and the millions and millions of 20-30 year olds carrying this kind of financial pressure will in no way affect the overall health of the economy

Absolutely frightening stuff. I think I’ll watch the Big Short again next week.