Funny Watch stories from my life that are certainly not linked together in anything nearly coherent enough to call a watch journey #1wc

https://youtu.be/hs1_wCD6CSc

Disclaimer: Nothing in this tale should be considered financial advice or even factual. As far as anyone should be concerned, I'm an arrant liar and this is yet another one of my tall tales. If I ever meet you in person, I will deny it to my dying day. 

Also, I'm completely open to the idea that @Aurelian believes that I have too narrowly defined the prompt and will disqualify me.  It would be a blessing.

Tagged by @Fieldwalker

In financial economics, there is a hypothesis that the movement of stock prices on a day to say basis is fundamentally random. This notion of the "random walk", first articulated by Louis Bachelier as a form of Brownian motion (which describes the random movement of particles suspended in a fluid) and the popularized by Eugene Fama (in his paperRandom Walks in Stock Prices). Burton Malkiel, in his seminal book A Random Walk Down Wall Street, posited that stock prices were so random that " a blindfolded monkey throwing darts at a newspaper's financial pages could select a portfolio that would do just as well as one carefully selected by the experts.". Being a stock picker by trade, I feel a little insulted admittedly.

But the one area where the random walk represents itself constantly is my watch collecting.  Mostly, I find my journey in watches has taken the form of a loosely related series of stories, some of which I've shared here.

I've talked about my permanent collection and all the stories behind the individual watches.  This is as complete a watch collecting story as it gets in the @Aurelian sense and there's no particular reason to repeat it.

I've talked about Steve-O and the $700k Daytona.  

I even describe the watches I encounter in my day to day and the little stories behind those.

You've been along for the ride on my particular watch journey (there's that word again) for entire time.

This time, I want to tell you all of story of another aspect of my watch collecting, that of the occasional watch flipper.

A Pawnbroker to Crypto Bros

I've come to the peace with the fact that I have odd hobbies. Not watch collecting itself, that's a socially acceptable oddity here, but the way I collect watches is definitely out of consensus.

You see, like normal crazy watch collectors, I buy my watches from authorized dealers and boutiques. I buy them from grey market collectors, from pawn shops, and used from private individuals.  

But due to the boom and bust nature of the Northern California economy, I also occasionally have the opportunity to buy whole collections of watches from individuals who eschew responsible collecting practices and spend money they don't really have on really expensive watches (primarily friends of friends).  My wife has, in the past, called me a pawnbroker to tech bros. I can't quite dispute that characterization, though I think of myself as more of a collateralized lender of last resort. 

I used to do this a lot more (which is how I got so many random watches that I never emotionally bonded with) but have slowed in recent years. The money frankly isn't very good (I figure I basically broke even despite the pretty decent bargains I drove) and it does drain a lot of time and energy. When I do do it, it's largely because I have friends who are looking for the specific watches in question.  

But it scratches an itch, the exact same itch that being an investor does.  I like striking a deal, I like getting a good price on something I'm curious about, and I like pitting my knowledge and wits against a counterparty with their own self interests and agenda.  The game just happens to not be a particularly profitable one and I'm okay with that.  Watch dealers, you earn your margins.

But most of all, I love the stories that arise from these transactions especially since recent sellers have predominantly been cryptocurrency enthusiasts.  And the excuses from crypto bros on why they're selling their watch collections are hilarious.

A few select quotes

"I didn't know I needed to pay taxes on the gains."

"I thought if I traded my Shiba Inu coin into Watch box for a Skydweller I wouldn't need to pay taxes.  And then my accountant f*cked me."

"Can you believe that Terra Protocol failed?  How else am I going to get 18% risk free returns?  How am I going to explain it to my wife?"

It's probably a negative commentary on my character that I find this all very funny in that distantly horrible kinda way.

I don't want to dunk on the crypto set too much.  Many of them are friends.  But it must be some weird cultural thing, some magical thinking around how their asset class works that I simply don't understand.

I have a dozen funny stories about watches I've bought from these but the most recent one that comes to mind is a transaction I chose not to do. Enter Blockchain Barry (pseudonym of course).

I actually like Barry a lot.  He's a friendly acquaintance who runs a set of levered separately managed accounts (sort of like an investment fund but hived off for individuals) that focus primarily on non Bitcoin, non Ethereum crypto currencies.  His start was as a managed futures guy who wagered on commodities futures and options markets but he pivoted to crypto in 2019, just before things started really taking off.  At his peak, he ran perhaps $150m in assets.  I wouldn't call him the most detail oriented guy but a generally genial sort of gentleman.

We have had friendly disagreements over the years, primarily about whether or not crypto made for an appropriate part of a balanced portfolio.  He argues that it's a speculative but worthwhile asset class, basically a play on future financial innovation and payment rails.  

Me? I'm pretty sure we're trading Bed Bath and Beyond coupons here.  

Except the federal government was smart enough to not allow folks to put their retirement money into Ponzi schemes hawked at the super bowl by Matt Damon.  But reasonable people can disagree (and I've been wrong about this sort of stuff before) so we get along otherwise.

His entry into the watch world was a little later (2021) and in a short time he assembled a respectable and not insignificant collection including a Submariner, a Cartier Ballon Bleu,  Ceramic Seamaster, a BB58, and a Seiko SPB297 (probably my favorite of the 62mas reinterpretation.)

A late last year, he came to me with a problem.  His portfolio of crypto assets had declined substantially in value but he owed substantial taxes on interest paid on his crypto yield plays and given that his current crypto holdings were very deeply underwater, he didn't have the cash to pay taxes. You might be but shouldn't be surprised at how common a problem this is.

***Beginneth Aside***

I think one of the most fascinating parts of crypto currency ownership is how much they push the boundaries of what it means to be a asset.

Like, the tax code never contemplated the possibility that something could basically be worthless and also a pay out a dividend that was worth something.  And yet, this is a regular feature for a lot of crypto.

Even though TerraCoin (classic) is basically worthless, it apparently still paid nterest (in TerraCoin) that I have been told by tax pros is still taxable by the IRS based on valuations from time of issuance (which before May 7th 2022 was $1 per coin and after May 7th was basically zero bexause of a collapse of confidence after the founder was accused of fraud).  

To put it in math terms, If you owned 100k TerraCoins, you might have earned 18k TerraCoins in interest (which would be declared to the IRS as $18,000 USD in interest income) even though the entire 118k stake of TerraCoins is probably worth zero today.

Plus the market itself is so illiquid, you can't even sell big blocks to harvest some taxable losses.  

I don't even have the words to levy a value judgement.  Nothing else in the world works like this.

***Endeth Aside***

So I offered to buy his collection, subject to inspection of course, at a discount.  He balked but eventually said that while he had found good prices for the Submariner and the Ballon Bleu he wondered what I might pay for the rest of it.  I suggested a low, but not unreasonable price, we shook hands on it and he bought the Seamaster, the Tudor and the Seiko into my office the next day.

Black Bay 58s don't really motivate my imagination but I have a friend who is interested in getting one and the specimen presented was in decent shape.  

The SPB297 is a beautiful riff on the 62mas case with a deep blue glacier inspired dial.  Clearly a beater watch but one I'd enjoy having around for a while to figure out if I'd like it enough to keep it.

Which brings me to the Seamaster.  I knew we were probably in trouble when he brought out this box.

10 points to all the Seamaster 300m owners who immediately said "Why did a 41mm Great White Ceramic Seamaster come in what looks like a Omega lady's watch box?"  Good question! 

A more genuine article

Would you believe me if I told you this might have been the best part about this watch because it's all really downhill from here.

I've searched high and low for a picture of this watch (ostensibly a White dial ceramic Seamaster 300m) but I honestly can't find one quite as awful.  The closest I can get to is the following homage.

Vs the genuine article

For the sake of argument, let's assume that the dial text and the logo were correct.  What immediately jumps out to you as not right?

Say isn't the date supposed to be at 6 not 9?  And shouldn't ZrO2 be engraved on the dial?

Other things of note

-Closed case back (whereas the original should be open with the beautiful spiral movement decoration)

- Extremely loud rotor

- Movement didn't hack (which suggests an 8 series Miyota)

- the bracelet fit and finish was pretty rough

I'm quite tolerant of homages, even clomages, but I can't help but laugh at just how bad a fake it was.

But being the diplomatic sort, I began to gently prod as to how he had managed to purchase it.  Did he get it from an authorized dealer or a grey market sell er...?

"No," he proudly replied "I bought it from a guy on Reddit and he even gave me a discount for paying in Dogecoin!"

All good things come to an end of course and had the sad experience of telling him that his watch was fake and that I was uncomfortable buying a block of watches where I knew that even one was not legitimate.

Some nasty words were said and he even accused me of trying to renegotiate an agreed upon price.  He stormed out of my office, threatening to go to an authorized dealer to get it verified.  Why this was not done earlier, I'm not certain.  

Lucky me, there is a happy ending for both of us.  Barry got his taxes paid without selling any more of his watches and we even managed to laugh off the incident over a beer.  He mentioned that the entire transaction had had a million red flags but he just super hot on the model and the price.  He promised to stay away from P2P buying sites without running things by me first.

And the Fauxmaster? Gifted to his brother in law.  "I never liked him anyway."

Just another casually insane day in the watch journey for yours truly 😉

------

@rocksinger89 regale us with the story of your Fossil and why it's going to smoke all of us. Posted on June 5th 2023 at 12:45PM Pacific Daylight Time.