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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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.
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In prior articles I have discussed the unorthodox role of prices in luxury watch markets. For example, since watches can serve as a highly convenient source of portable liquidity, when prices go up the liquidity benefit from a watch is greater because you can carry around more value on your wrist. This means that, at least along one dimension, buyers might be more inclined to buy a watch as prices go up.

The watch market, then, serves as an exception to the prevailing notion that as a product gets more expensive people buy less of it, otherwise known as the law of demand (a law which tends to hold for almost any product). In this article I will explore additional reasons why the law of demand doesn't apply to luxury watches and, further, show that many features of the luxury watch market can be explained by nontraditional consumer behavior. Fair warning: I have steered clear of the math which we economists use to investigate markets but that will have to end here. I will re…

Horolonomics

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