Do you miss depreciation?
How depreciation has altered the watch collecting mindset
Note: This is a post from November 2021, originally published on my old blog, copied here so I can reference it and link to it in future posts.
I recently had a fascinating conversation with “D” @doobooloo about his new Furlan Marri watches, contrasting them (perhaps surprisingly) with his new R. W. Smith “micro architectural wonderland” which he recently took delivery of, after a 5 year wait! We then got onto the topic of how depreciation has changed the collecting mindset… and this post gives us a glimpse into collecting in what I call the “endgame league” – I’m sure D will disagree! I hope you enjoy the perspectives.
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Introduction
Before we get into the alternative perspectives from D, let me share some of my own. It is no secret that I am a huge fan of F.P. Journe. The motto of the brand, Invenit et Fecit (Latin for “invented it and made it”) denotes that the company designs and builds the entirety of the movements… and speaks to the nature of the man – and in particular, his grit. It is this grit which led to the eventual development of the now coveted Chronomètre à Résonance.
It can be said that François-Paul Journe is one of the most influential watchmakers of the modern era. Alongside a select few craftsmen, he has led the way in combining the inventiveness of late-18th century horology with the creativity that today’s technology affords us. He manages to bring classical style and his own distinct vision together, through brilliance in design and astute mechanical knowhow.
I won’t bore you with another version of something that has been discussed many times before – the phenomenon of resonance and its application to fine watchmaking has been discussed at length by many others… namely, Revolution here, Jack Forster here, and the Journe Guy here and here. There’s a lot of good background in those posts, and I’d recommend reading them if you’re interested in resonance. I find it fascinating, and appreciate being able to wear such a storied masterpiece on my wrist.
Why am I discussing F.P. Journe’s Résonance in a post about depreciation? Seems counterintuitive, but in this case, context matters. I grew to appreciate the man and his ingenuity, along with his significant contribution to the world of horology… and this impacted how I viewed the Résonance. It wasn’t just another watch; It was the pinnacle of Journe… and I could think of no other grail for myself. This will become relevant in the next section.
Depreciation in context
My first story is about my first piece from Journe, the Résonance. During the course of hunting down a Résonance, after my pal Shawn had finally found the piece (incidentally, the whole process from start to finish is a really special story worth a separate post) – I distinctly remember having a conversation with Shawn about ‘downside risk’… all I wanted to know was how much I would stand to lose, if I needed to sell it in a hurry. I wasn’t planning to sell it, but simply doing what any normal person does when weighing up a significant purchase since I unfortunately don’t have unlimited funds. I had this option though Shawn to buy a new piece, and I had another option to buy a pre-owned one as well… and I eventually chose to buy it new, with a ‘worst case’ scenario of potentially losing 20-30% if I needed to exit quickly for some unforeseeable reason. I weighed this up and decided I loved the watch enough to take that hit – simple as that.
My second story is about Journe’s Èlègante, and this was very soon after getting my first Journe. Turns out, I was unable to get one due to a series of unfortunate events I shall not bore you with. That said, at the time I originally wanted one it wasn’t the crazy hyped watch you see today (in peak hype it was trading at up to 5x RRP!). The sleep function isn’t entirely unique, and the quartz technology isn’t the best in the industry… but: it is an F. P. Journe watch.
In the same way that some people appreciate fine art created by specific artists, I love F. P. Journe’s work. I wanted an Èlègante for a couple of reasons. It was a quartz, meaning it would always be correct, and not require setting or winding. In the same way that I use my G-Shock watches for situations where I was picking up a watch in a hurry – this would be ideal. It was also not something that looked expensive, meaning it would easily fly under the radar as some ‘cheap and cheerful’ piece, not attracting the watchful eyes of would-be thieves. It also happens to have a screw-down-crown (lol) – making it water resistant and suitable for my everyday needs such as bathing my kids and even the occasional swim.
In short, in instances where I wanted a quick ‘grab and go’ watch, this would take the place of a G-Shock, except now I would be wearing the work of F. P. Journe – hopefully the prior context highlights why this is a big deal to me. Over time, the secondary market prices for this watch soared to insane heights… making it even less likely that I would ever get one. Were it not for the assistance of a fellow collector and friend, I probably would never have got one anyway.
My final story is about the Vacheron 4500v… I had tried it on about 18 months before buying it, and remember liking it, but being in the process of buying other watches at the time, it wasn’t a priority. I had taken one wrist shot on that day… but I could barely remember my overall impressions of the watch from that day. Anyway, given it was during lockdown, I couldn’t go and try it again, and was faced with buying it ‘unseen’, aside from my own wrist shot as a guide. While I bought it at a discount (!), I remember asking the dealer who I bought it from how much I would lose if I decided I didn’t enjoy it and wanted to sell it – at the time, it was ~ £1000 which I stood to lose if I sold it soon after buying it. I saw this £1000 as the cost of a trial, and was prepared to take the risk and buy it anyway. The rest, as they say, is history… most of you who follow my Instagram page will recall how smitten I was with the watch when I first got it – turned out to be a good ‘investment’ after all… but at what cost?
The indirect ‘cost’ of appreciation
When I got my Résonance, I used to wear it everywhere – to the supermarket, to the mall, to the park, you name it. As long as it wasn’t going to be some sort of ‘activity’ where I might damage it, you could bet I’d be wearing it. Nobody really cared about the watch, it wasn’t particularly recognisable, and it definitely wasn’t something well-known to thieves etc.
Over time, as this began to change, auction results led to value appreciation… it suddenly became somewhat of a burden each time I wanted to wear it. Is the situation risky? How likely am I to be spotted, or targeted? Is it irresponsible to wear it so openly? All this nonsense crossed my mind – this was previously a feeling reserved solely for the usual hype watches like Rolex Daytona or Patek Nautilus. What also happened, is something which D will eloquently describe later on – I began to realise that by using it as a daily, I might in fact be ‘watering down’ its specialness in the collection.
With the Èlègante… When I did eventually get it, one of the primary ‘benefits’ was perhaps non-existent too – it was no longer the ‘cheap and cheerful’ or ‘grab and go’ type watch I had intended to buy… no longer was it something unrecognisable and under the radar… instead, the bright colourful straps and distinctive tonneau case made it an easily recognisable watch – the easiest 50k an opportunist can spot, and steal.
Finally, with the Vacheron 4500v – without depreciation… simply loving it and showcasing its positive attributes led to direct engagement from the brand – although I take objection to how the brand is treating some customers today, they actually used to be a humble brand who actually appreciated collectors – they knew these were people who simply loved the brand for what they offered, not for the potential profits (since there were none!). As the value of the watches rose above retail, so did the arrogance of the brand’s executives – and so in this case, the loss of depreciation led to not only the breakdown of relationships with the brand, but also the likelihood of being mugged/robbed for this watch too.
A real world perspective
My conversation with @doobooloo was borne out of my posts related to Furlan Marri (here and here). Now perhaps some context on the man first – he’s a GPHG Academy Member and car enthusiast and avid collector of high-end watches, including a Roger Smith piece which he recently received after a five year wait.
So with that context in mind, this is what D had to say about his experience with Furlan Marri after owning and wearing it for a little while:
I was skeptical as hell going into it but when I saw it in person for the first time was genuinely blown away by the quality of casework, dial, hands, etc… all the attention to detail, to the aesthetic elements, clearly outdoes many if not most watches even in the 5 figure range. I ended up picking up 4 of the 5 variations at retail – no markup – as I did genuinely like it and thought it had a role to play as a philosophical anchor in the collection. What I mean by that is “pretty and well made” simply isn’t good enough when we can access a $500 mass-produced watch like this, with such attention to detail. Then I received and wore it one day, just to understand it a bit better, thinking I’ll probably end up admiring them from the watch case or gifting them to friends and family who aren’t into watches as a wonderful vehicle to introduce them into it. Well – turns out, it’s just a really good looking watch, period. No ifs or buts. Plus, I’m not necessarily into the vintage aesthetic. The watch doesn’t feel like a compromise in any way, in terms of how it looks on the wrist. I actually genuinely like wearing it and looking at it on my wrist. Which is all a huge U-turn from my expectations. Honestly, it has shaken up some of my preexisting beliefs about watch design and craftsmanship, and I think it is always good when old beliefs are shattered. Ultimately, time will tell… but, despite having been a cynic, I am actually enjoying wearing the watch. I still don’t like all the hype and flipping going on but I am now open to the notion that six figure watches can coexist alongside a $500 watch and both be enjoyed together.
@doobooloo
After reading this, we continued the discussion… At this point I must highlight that I never questioned the standalone quality of Furlan Marri – I simply questioned the place of these watches in a high-end collection, and the hype that ensued when affluent collectors all bought one. My argument was that newer or less experienced collectors will want to buy the watches because they are seeing these affluent collectors buying them, and would naturally assume “they must be good if this guy has a number of Patek Phillipe watches and still chooses to wear this“. That isn’t to say FM is bad – just that the perceived hype is perhaps unwarranted – and these affluent collectors wouldn’t really wear these watches. Read the full post here if you’re interested in that take.
With noting as well, that D had some additional clarification to share on the concept of mass-production:
I also want to clarify what mass produced means here, for FM. This is a tricky definition, since even many independents with low production volumes rely heavily on CNC and other machine production & rapid prototyping/production methods, and no watch is truly 100% hand made anymore from beginning to end. Hence I think to a large degree what constitutes mass produced is reasonably arbitrary, one can even argue that FP Journe has entered this territory to their own definition of mass produced. What is more important here I think is not whether something is mass produced, but whether something is produced with the utmost in design and quality, the combination of which one could say results in products with soul. And arguably, producing something in larger quantities (at a low price point, especially) to have soul is far more difficult than hand producing artisanal pieces with soul.
@doobooloo
This point blew my mind, because while I have continued to question the rationale of any uber-collector wearing a Furlan Marri… what this highlighted to me, was something intangible that a wearer might get from the watch, which nobody else can measure.
Who am I to argue with any collector who ‘feels’ the ‘soul’ in any watch design… and yes, I would agree that imbuing ‘soul’ into any mechanical watch is perhaps ‘easier’ when you have very small production… and in fact is far more commendable and noteworthy, when something ‘mass-produced’ manages to achieve this.
Anyway, I asked D this question – “what makes you pick out a Furlan Marri from the watch box when instead, you could be wearing a Roger Smith (“RWS”) masterpiece … or any one of your other high-end watches?“
That is the question I had too – would I even want to touch FM with RWS in the box? Believe it or not FM has gotten more wrist time than the RWS at this point. I think at some point a watch just becomes too valuable to wear freely… somewhat like cars as well. I am on my 3rd GT3 Touring right now (plus a Speedster in between), after going back and forth vs many other cars this is the car I want to get in and drive. The previous cars were either very high spec and/or rare Paint to Sample shades and as much as I tried to use them for everything I always felt a bit like, “it’d be a shame if I damaged the car and would have had to repaint it”, given how much value is in the special paint. So this one I have now is a base spec simple white paint car and I feel so great to be able to drive it daily to work, park it wherever I want to park it, etc… it’s the least special of the GT3’s I’ve owned but probably one I’ll get the most driving enjoyment out of, one I can truly drive like I stole it. Does it make the white GT3 a better GT3? Clearly not – the other cars were far more collectible and valuable and arguably much more meaningful to own, but often felt like I was captive to the car’s specialness. It’s not a perfect analogy but think something like this also comes into play with watches. At some point in crossing a certain value threshold – and obviously this differs for everyone with different wealth/risk levels – it becomes almost irresponsible to casually slap something like RWS on the wrist daily, and hence, it can be a burden. For instance the RWS, given recent auction results, how do I even insure it? Etc etc…
@doobooloo
Granted, I asked about the RWS, so this reply is specific to that. I then asked about perhaps other pieces which are less valuable than the RWS, but still far more valuable than the FM. D described how he loves his Patek 5101p – so I asked him again, what would make him wear an FM over that.
A few mental scenarios would result in that: 1. Seeing clients and want to wear something cheap that won’t raise eyebrows if noticed 2. More active day predicted ahead – going to the playground with kids on a weekend for example 3. Change of aesthetics & feel
@doobooloo
My exact response was this: On 1: it’s meant to look like an expensive Patek. In fact it’s a close copy. So what if they mistake it for a 1463? On 2: ok fair enough… but I’d tend to wear a more rugged watch for that- Rolex sports or even G-Shock. However, everyone’s different so fair enough. 3. The only one which I compute – and this concept baffles me as well.
D replied explaining, particularly on point 1:
If the guy knows what an expensive Patek looks like, he probably knows this isn’t one or in the least he is a watch guy and we’ll have a great chat about watches. What’s I am intending to avoid is Rolex, RM, Nautilus/Royal Oaks etc – watches people know are “expensive” without knowing anything about watches.
@doobooloo
We then went on to discussing point 3 further, which is how this post came to be. In fact, D described how he used to cycle around in Manhattan wearing a Tokyo Résonance and go for runs wearing a Journe Regency Tourbillon too! One final quote to sum it up:
Totally felt safe then too – nobody knew what they were and big depreciation was just a fact of life.
@doobooloo
To this, I responded: “I miss depreciation, tbh“.
Of course, this absolutely doesn’t imply that the Roger Smith has no place in his collection; Of course it does! So, on the topic of wearing his RWS, and how he sees it:
How does one value art anyway, and is this is as close to art as watches will get? I see this watch on my wrist for very special occasions, thereby amplifying the specialness of the watch. One would not just casually hang the Mona Lisa in one’s living room with kids running around throwing spaghetti and meatballs … not just because one thinks the painting is junk but out of respect for the painting and what it means for the world of art… this raises the topic of whether, watches are “art”? Now that’s one hell of a rabbit hole!
@doobooloo
Now, despite inflated valuations slightly ruining broader enjoyment of watches like my RWS, this does not have to mean reduction of total enjoyment of the watch. I am gifted with extraordinarily shoddy memory, and it is very difficult to remember things, names, events, etc. very well outside of a very narrow range of topics that form a set of core interests for me. The degree to which I suffer from this is rather extreme. And watches have always been a wonderful anchor for my memories – since I love watches so much, I tend to remember events, trips, people when the memories of them are anchored to wearing of a particular watch at that time. And interestingly, the more vivid, fond memories are those with the more special pieces that don’t get as much wrist time – regardless of the specialness of the event in question. So, pieces like my RWS will be marvelous ways to celebrate special occasions and make a deep etching into my consciousness, and perhaps, the subconscious as well.
@doobooloo
I have previously argued that “life’s too short to wear watches you don’t absolutely love”… given you only usually only get to pick one watch each day, picking out something you don’t really love is wasting wrist time you could otherwise be spending with something you DO love.
D’s counter-argument is sound too – you can’t drive a 911 GT3 on an off-road expedition, but that doesn’t mean you love it any less whilst you aren’t driving it. Sure – on the other hand, let’s say you had a Range Rover for the off-road expedition… it probably DOES mean that you prefer the Range Rover for off-roading more than any other off-roader within your budget.
That being said, what is highlighted here is how everyone experiences a unique journey with collecting. D finds his watches serving as useful anchors for special memories, but in contrast, some people may not value this nearly as much, if at all. I personally have only one watch which has some sort of memory attached to it, and given that I favour a ‘consolidation’ mindset when it comes to watch collecting, it helps that I don’t get too emotionally attached to any single watch. Granted, if I found myself with unlimited funds, this might change.
Some parting thoughts from D on the nature of my comparison of Furlan Marri to his RWS to end this section – I must add, I didn’t really consider the gravity of my question when I first posed it. For me, I think the RWS is almost ‘too special’ to include in any ‘daily watch’ conversation… no collector I know, who owns an RWS, simply wears it every day. So I completely agree with D in this final quote:
It’s a bit unfair to bring this comparison up with the RWS in this context because even if market hadn’t gone nuts and depreciation was still very much a fact of life, I would have probably not worn the watch daily to beat around and reserved it for more special occasions. But – this market does amplify things and putting the FM and RWS next to each other makes for an interesting set of comparisons to highlight the different ways the two shine.
@doobooloo
Conclusion
Back in the days of depreciation being par for the course, people would buy watches and simply experience pure joy from wearing them. There was nothing more to it. Today, we find ourselves experiencing clouded judgement… often driven by other reasons to purchase such as investment potential and perception amongst peers. The ‘investor’ class of watch purchasers happen to have the spending power to drive up prices, and ordinary collectors of old may even find themselves being sucked into hype too. The ability to collect “for the joy of it” is just ONE WAY to collect. This post does not intend to suggest anyone who has motives beyond “simply enjoying the watch” is wrong – to each their own. The crux of this post is to simply share a perspective on how times have changed, and showcase what other collectors feel – even the ones collecting at the highest echelons in the watch game.
My favourite takeaway is this quote from D: “it has shaken up some of my preexisting beliefs about watch design and craftsmanship, and I think it is always good when old beliefs are shattered”.
Jason Fried, talks about Jeff Bezos who explains “… the smartest people are constantly revising their understanding, reconsidering a problem they thought they’d already solved. They’re open to new points of view, new information, new ideas, contradictions, and challenges to their own way of thinking.” – and that’s clearly what D was showing here, having experienced Furlan Marri first hand.
Stanford University professor Paul Saffo has a simpler way to think about intelligence. Have a “strong opinion, weakly held.” This framework allows your mind room to change.
For me, aside from the takeaway above, I have been reminded not to take a collection at face value… the meaning of each piece to any collector can always be more than the watch itself, and perhaps a handful of uber-collectors can find value and meaning from cheap quartz watches just as much as they do from unique, handcrafted, mechanical masterpieces. As always, there are no right or wrong answers… just many perspectives.
I want to end with a heartfelt thanks to D for his insights and for taking the time to share his thoughts… I really look forward to the next one, where we can hopefully talk more about “watches as art“. (He hasn’t agreed to this yet!)