Special Report: Only Watch Auction 2019

The Only Watch auction took place today in Geneva. In this auction manufacturers create unique pieces and auction them for a charity.

I streamed a live blog of the event as I watched it. I tried to give my impressions of how prices would land prior to bidding and I think I did OK with my predictions. There were some surprises and almost all of them were positive. 1

1. The Patek lot broke the world record for a wristwatch at $31 million. I think this surpassed even the wildest estimate of what would happen
2. Although the Patek will get all the attention the blacked out Tudor actually was a far bigger surprise. The Patek was 10x its estimated high. The Tudor was 63.6x at CHF 350k. This is really important to note.
3. Vacheron and JLC seriously underperformed. If these houses are able to build reputation in line with Patek then whoever won those lots can look forward to some impressive appreciation.

Overall it is fair to say that these were extremely impressive results. I believe that with the recent stock market rally and some calming of trade tensions we can expect to see strong auction results in the near future. Phillips Double Signed is also happening today and their "Game Changers" is coming up in December so stay tuned.

You can watch the full 2+ hour stream of my coverage below:

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The Luxury Watch Ban Hammer

Word is beginning to spread that buyers of certain luxury steel sports watches have unwittingly entered into a sacred pact with certain brands. The pact is this: if you are eventually selected off an unimaginably long wait list you may buy a watch that isn't supplied in great enough numbers. But you may not sell it. If you do, you will be prohibited from buying that brand again. The brand will drop the ban hammer.

In an article published Nov 24, 2019 in GQ an anonymous author states that after having quickly sold his Patek Philippe Aquanaut 5167 for a tidy profit, "Patek Philippe knows that it is not [his] anymore. They found out and [he is] not sure how. [His] name could be potentially circulated among other Patek ADs, [he is] told. The AD (who [he] had a great relationship with) will no longer offer [him] 'hard to buy watches'."

And from Watchpro we have: "people that do manage to buy an investment-grade watch and flip it for a profit are being hunted …

Scarcity as Strategy in Horology

Watch industry observers have spent a lot of time dissecting the unavailability of steel Rolex sports models this year (submariner, GMT, etc). These timepieces are presently impossible to buy at the manufacturer's suggested retail price (MSRP). You can acquire them outside official channels but only at a multiple of retail. For one summary of this topic check out episode 48 of Hodinkee radio below.

I've listened to a lot of explanations and, frankly, almost all of them miss the point. While I don't know everything I should about perlage I do know something about economics. And economics explains almost everything about this watch industry phenomenon.
Horolonomics 101Rolex is involved in rationing: a shortage which is, for the most part, manufactured and intentional. With this discussion I will explain two things: 1) what rationing does and, 2) why Rolex would do this. The TL;DR on what follows is that the shortage:
is inefficient.Creates profit for watch buyers.Builds …

The History of the Radioactive Rolex with One Complication

My family and I have a tradition when we visit the beach. We search for sea glass. When jagged and sharp shards of broken glass land in the ocean the constant sluicing of sand changes them. Over decades or more the edges soften. Clear glass becomes cloudy. Given enough time the entire shape of the glass can morph, from rectangular to ovoid. Each piece of sea glass is inherently unique due to imperceptibly small forces which slowly accumulate, resulting in major changes.

We know this is also true of vintage timepieces. After decades lume changes in hue. Dial faces crack, craze and fade. An object which was often mass produced consequently becomes a “pièce unique.” Watches are engineered to accurately and unchangeably mark the passage of time. We love and value vintage watches for the fact that they are altered by time itself.

The story I offer here underwent similar changes. It began as an effort to understand more about an unfinished chapter in the history of Rolex. It be…

Horolonomics

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