CNBC: A timeless investment choice

I came across this interesting article on CNBC’s website which talks about watches as an alternative investment, more interestingly, as an asset class that withstands the test of time. Personally I find it satisfying that my little hobby (my wife would call it an obsession) can now be described more respectfully as an alternative form of investing. Hopefully with the aid of this article I can argue my case more eloquently and convincingly in justifying my next watch purchase to my better half.

Some points from the article which I found to be worth noting:

i) The article that the current downturn has been hard on the luxury watch market. However it is necessary to differentiate between “retail” luxury watches from “collectible” luxury watches. In the current global economic malaise the collectible luxury watch market have been more resilient. Record prices are still seen at recent horology auctions for rare timepieces.

ii) “Jon Cox from Kepler Capital Markets says collectible watches may also offer inflation protection as investors may be worried of higher price levels in the future. He adds that in some countries, a Rolex is even considered a currency.” – That’s good news for all Rolex fans out there. Like they say, never leave home without your trusty old Rolex. You never know when you run out of hard cash. With a Rolex or two on your wrist, you can confidently pop into the nearest neighbourhood pawn shop and walk out five minutes later with wads of hard currency bulging in your pockets.

iii) “While age for most other asset classes is associated with depreciation and loss of value, a collectible watch investment ticks differently. The older a timepiece is, the more value it usually holds.” Words of wisdom indeed. Like I always say, it’s far better to put your money into good watches than to buy an expensive luxury car which depreciates the moment you sign the purchase agreement. But I’ll bet there are people out there with deep enough pockets who would dispute my line of thinking.

iv) “Signs of wear and tear show a watch is authentic and has history, while a polishing only reduces a watches’ value.” So all you weekend watch polishers please take note. You may be polishing off your watch value, so go lightly on the cape cod cloth.

Junkers 6660-1 Iron Annie JU52 (featuring eta valgranges a07.161) – A WATCH review

Background

Junkers (pronounced Yoonkers) is one of three watch brands owned by Pointtec Electronic GmBH, a German company founded in 1987. The other two brands offered by Pointtec are Zeppelin and Maximilian Munchen.

Pointtec began by designing and producing private label promotional watches for German multi national corporations such as Borsch, Siemens and VW. In 1997 Pointtec licensed the rights to the Junkers name from the estate of Hugo Junkers, the famous German aeronautical engineer who created the first all metal airplane, making use of corrugated metal sheets. Thus the Junkers brand was born. The typical Junkers watch  combine historical aviation features with modern mechanical and electronic watch technology.

Description of watch

The Junkers Iron Annie JU52 is an automatic watch with power reserve feature. From the name it is obvious that the watch is inspired by aviation history, in particular the famous German airplane Junkers JU52. The JU52 was designed in 1930, and it incorporated corrugated metal skin to strengthen the plane structurally. The Iron Annie, as the JU52 was also known, was produced by Junkers from 1932 to 1945, and it saw both civillian and military service during that period.

The Junkers JU52 watch traces its roots to the historical airplane and adopts the corrugated metal sheet skin into the dial design. This is the single most important element that differentiates the Junkers watch from other watches.

Movement

ETA’s new caliber Valgranges A07.161 is the mechanical engine that drives the watch. ETA developed the Valgranges movement, based on the workhorse Valjoux caliber, to meet the growing demand for larger watches. Compared to ETA’s workhorse calibers, the 2824 and 2892 which are both 25.6mm in diameter, the 36.6mm diameter of the Valgranges allows the caliber to be cased inside larger watches without the use of oversized spacer rings.

The A07.161’s larger diameter allows the incorporation of a “big” date disc, providing legible date indication without the need for the magnifier on the watch crystal. In addition the caliber also provides the useful power reserve indicator function at the six o’clock position.

Specs:

Brand:ETA
Model: Calibre Valgranges A07.161
Description: Mechanical movement with lever escapement, automatic winding
28’800 vibrations per hour (4 Hz)
16 1/2’’’
24 jewels
Diameter: 36,60 mm
Thickness: 7,90 mm
Functions:
• hours, minutes, seconds
• power-reserve indicator
• date window
Index assembly: ETACHRON with fine rating adjustment
Power reserve: 48 hours

Being based on the legendary Valjoux caliber, the Valgranges A07.161 incorporates many of the Valjoux’s desirable features. However it also inherited the infamous Valjoux “wobble”, a minor point, but one worth noting.

As the photos below show, the movement finishing is satisfactory. The plates and bridges are decorated with circular graining or perlage pattern and the rotor is finished with geneva waves or cote de geneve decoration. Chemically blued screws are used in the throughout the movement.

Case

The case is 42mm in diameter and 15mm thick. Lug to lug the watch measures 49mm. It is made of stainless steel with a matt brushed finish. The screwed-in case back comes with a display glass which gives a clear view of the Valgranges A07.161 movement. The watch is rated to 5 ATM water resistance.

Crystal

The watch is equipped with a scratch resistant sapphire crystal. The sapphire crystal is slightly domed but unfortunately is not AR coated.

Dial & Hands

The large dial is white and legibly printed with arabic numeral hour markers (less the numbers 3, 6 and 9). There is an outer ring lined with the minute markers in 5 minute increments. The dial itself is engraved with a corrugated metal sheet finish inspired by the corrugated metal skin on the Junkers JU52. The Junkers label and logo are located below the twelve o’clock position. At the nine o’clock position is printed “Iron Annie JU52”. A big date window is located at the three o’clock position. The large diameter of the Valgranges caliber allows the date window to be placed right at the edge of the dial. The power reserve indicator is situated at the six o’clock position, and below that is the finely printed “Made in Germany” label. The hour markers are not coated with luminescent material which will be a point of concern if one needs to read the time in the dark.

The hour, minute and second hands are rightly proportioned and are painted deep blue. The hour hand reaches to the arabic numeral hour markers and the minute hand is long enough to reach the outer minute markers.

Crown

The unsigned crown is non screw down type and is nicely knurled. Both features facilitate manual winding of the watch.

Strap

The watch comes with a black genuine leather strap with contrast stitching. The buckle is the tang type and is unsigned.

Lugs

The lugs are gently down from the watch case but are finished smoothly with no sharp edges. The lug width accommodate 22mm size straps which are attached using spring bars.

Conclusion

The ETA A07.161 is a relatively new caliber, first introduced in 2006. Despite its many attractive features, this caliber is still not as commonly available as the workhorse calibers 2824 and 2892. Junkers offers this exciting new caliber in the Iron Annie JU52 model, nicely packaged in a good quality watch with an attractive price tag.

Resources:

i) Junkers Ju 52 history (Wikipedia article)

ii) Junkers on Pointtec website

iii) Valgranges Caliber information

iv) The Watch at Red Army

Desperate times for the SEC.

On Friday 19th September, the SEC imposed a temporary ban on short selling in an elite group of 799 US financial stocks. The SEC also eased stock buy back rules which previously restricted companies ability to buy back shares at the market open and close.  The moves were designed to stem the steep decline in stock prices over the previous two days. The SEC’s desperate measures helped fuel one of the most dramatic short covering rally in recent times. Chris Cox must have hoped that the old saying, “Desperate times call for desperate measures”, would  justify the SEC’s unfortunate decision to tamper with the workings of the free market.

The SEC’s traditional role is to regulate the stock market and prevent corporate abuses relating to the offering and sale of securities. In its recent moves the SEC has dramatically reversed its role and instead aided one group of market participants in artificially propping up prices in ailing financial companies. This is tantamount to ramping the markets.

The SEC is effectively changing the rules in mid game for market participants. In particular the new rules have benefited the bulls tremendously while severely shackling the short sellers. You can’t have a free market when the regulatory agency so blatantly tilt the playing field in favor of a particular group of players when the game is not going their way. I don’t know how the rest of the world sees this but from my corner here it looks very much like blatant cheating! It is sad that the USA no longer practice the free market principles which they had been championing.

This site is now powered by WordPress.

It took a while but I have finally managed to convert my blog from Textpattern to WordPress. The conversion process was made easier by the import utility provided by WordPress, but a considerable amount of time and energy had to be expended  to tidy up and reformat the content.

Then there’s the usual search for a suitable WordPress theme, followed by the tweaking and tinkering to customise the look and feel of the website. While the site is still far from complete, the process has reached a stage whereby it is ready to go live.

Hence the old Textpattern driven blog has been laid to rest and with immediate effect this site is now powered by WordPress.