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How will the art market meltdown affect collector Ferrari cars?

Discussion in 'Vintage Ferrari Market' started by Platini 289, Feb 7, 2016.

  1. Platini 289

    Platini 289 Karting

    Sep 21, 2015
    81
    Hi MSN,

    Thanks for the info. If we remove the ultra collectible, low volume, ultra low mile original cars, is the market just as healthy? From a personal point of view, I'd be interested in driver / A1 cars up to say £500,000. I accept there will always be the uber-rich in society who will cherry pick the likes of the 288 you mention.


    Here's another article you may be interested in. Of course, they have a vested interest but worth a read nonetheless:

    2016 Arizona and Paris auctions – the tip of the iceberg
    2016 Arizona and Paris auctions - the tip of the iceberg. - Classic Car Finance

    GB auctions coming soon at Silverstone.

    Cheers!
     
  2. Platini 289

    Platini 289 Karting

    Sep 21, 2015
    81
     
  3. Marcel Massini

    Marcel Massini F1 World Champ
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    Mar 2, 2005
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    Marcini? Who is he?

    Marcel MASSINI (please! Thank you.)
     
  4. BIRA

    BIRA Formula Junior

    Jun 15, 2007
    889
    May be Massel Marcini, never met him?😀
     
  5. ARTNNYC

    ARTNNYC F1 Rookie
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    Jul 8, 2005
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    One thing I will add that surprised me recently is Ebay. I am on there frequently and I remember a couple of years ago there were 300 Ferrari's for sale. Then last year 400. Now there are over 600 for sale! It seemed to jump very recently or am I missing something.
    BTW as an art dealer from NYC I can tell you the middle market and below is VERY weak.
     
  6. Platini 289

    Platini 289 Karting

    Sep 21, 2015
    81
    Sorry for the misspelling...
     
  7. Bradwilliams

    Bradwilliams F1 Rookie
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    You catch on quick :)
     
  8. Super_Dave

    Super_Dave Formula Junior

    Oct 6, 2014
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    How far do you think the art market still has to fall?

    We are at the very start of the broader downturn (on the financial markets side here in the U.S.) other than perhaps tech, which clearly already took a nose dive as Tech was more a bubble starting to deflate than a cyclical move. I don't really follow the art market other than when it makes headlines, so curious to get your on-the-ground thoughts.

    I think there are a few major bubbles globally, due to increased speculation due to the low return environment in higher quality financial assets:

    1. Tech --> bubble recognized for a while, now visibly deflating
    2. Collector cars --> bubble recognized for a while, cresting and now on the initial decline phase
    3. Specific real estate markets --> China has already started to deflate, Australia crested, Canada (Vancouver, Toronto) recognized but currency adjustment temporarily supportive, London (lots of attention), San Fran (recognized but tech bubble bursting will be catalyst) and New York (more limited downside risk but recognized and top end has definitely crested)
    4. Art --> I don't follow this market, but understand it was frothy / bubbly and now is in decline
    5. China --> don't need to explain this one

    There is going to be correlation between these markets for the simple reasons of wealth effects and fear so always interested in getting others' views, particularly in an area (art) where I have very limited knowledge.
     
  9. Tenney

    Tenney F1 Rookie
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    Feb 21, 2001
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    [ame]http://www.youtube.com/watch?v=wK-b5PLhrEI[/ame]
     
  10. Tenney

    Tenney F1 Rookie
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    Feb 21, 2001
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    Tide went out on the muscle car market a while back, and is coming back (and then some) for the truly rare - while not for regular production stuff in general, as yet. A more mature market?

    https://www.mecum.com/collection.cfm?auctionid=FL0116&groupid=10260
     
  11. Super_Dave

    Super_Dave Formula Junior

    Oct 6, 2014
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    Sell offs are often (typically?) overdone and truly great / rare stuff can almost always command fair value.

    I liken some of this to NYC real estate (taken as a whole). In the last crisis this market remained nearly unscathed because the fundamentals never went completely out of whack. Part of that is the prevalence of the co-op structure and part of that is that it is a truly, and persistently, high-demand, supply-constrained market.

    A 15-20% dip may happen, and perhaps a little more severe at the higher ends, but the market itself is very durable and dips usually offer buying opportunities. Harder to say the same for some other RE markets.

    I think there are even some exotics (including poster exotics) that would find floors very quickly. But then again sometimes fear takes over, presenting great buys. I imagine if 288 GTOs ever fell substantially, they would get snapped up extremely quickly..
     
  12. paulchua

    paulchua Cat Herder
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    #62 paulchua, Feb 19, 2016
    Last edited by a moderator: Sep 7, 2017
    Dave,
    Are many of your posts just made up?


    Talk about 'selective' bubble talk, so *now* fundaments matter? (High-Demand, and supply-constraints)?

    By the way, remember *you* said you were an "expert" in bubbles remember? (not me) So as an expert on 'markets', how could you have missed this (see charts below) living in NYC?

    You see that boys? If you own a Ferrari - a crash is imminent (he could be right btw), but if you own a real estate in NYC, the fundamentals will keep you unscathed...(now talk about cognative dissonance) hmmm let me guess, you own a house near the area? Btw, you point out supply, last I checked you can build up nearly 1 KM now, also you can theoretically dredge. You can't make anymore 'original' Lusso's or F40s unless you are a practitioner of black magic? (at this point I wouldn't be surprised if you said you were)

    a 27% Drop from top to bottom is not what I would say is 'unscathed' - sure the prices have recovered (especially commericial and condos), but say that to leveraged investors who bought in 2006/2007 presenting yourself as a "market expert" with 'inside information'

    (sigh)

    Do us all a favor and quit already with the faux intellectual commentary presented as fact.. it's getting really old. Actually I take that back, pointing out your false statements is one of the more entertaining things I find on this board....continue with your pontifications so "I may taunt you a second time..."
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  13. paulchua

    paulchua Cat Herder
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    #63 paulchua, Feb 19, 2016
    Last edited: Feb 19, 2016
    What happen to Potato? "hit it and quit it" with four posts? all devoted to defending this guy?

    What happened to "Try debating actual arguments"?

    He comes here with the complaint that I don't debate, I do just that, and instead practicing what he preaches and pointing out where I am wrong....he goes *poof?*

    At least, he's consistent with his friend, Super_Dave. Say outlandish stuff, get upset when people actually prove them wrong, hide and call *me* the troll.

    haha
     
  14. nis1973

    nis1973 Formula Junior

    Jan 19, 2013
    397
    NYC/CT
    It's amazing how nasty and personal this discussion has gotten...

    Paul, the housing data you present looks more like NY state (or NYC metropolitan area) rather than NYC proper. NYC, and especially Manhattan (which is what i think super_dave had in mind when referring to NY real estate), had a pretty different experience. Having said that, I regrettably did buy at the top in Manhattan and I know firsthand it definitely didn't go unscathed. It did recover (or exceed its previous heights in many cases) relatively quickly which is why it's not a bad analogy to what he thinks may happen to 288 GTOs and other truly special cars - if they do fall they are likely to snapped up and recover quickly.
     
  15. ttforcefed

    ttforcefed F1 World Champ
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    marcel for the record that wasn't me who got your name wrong - for some reason the way you quoted it makes it look like I got your name wrong.
     
  16. paulchua

    paulchua Cat Herder
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    #66 paulchua, Feb 20, 2016
    Last edited: Feb 20, 2016
    Hi Nis1973, thanks for you post...just peruse super_dave's old posts...he's been a troll on these boards for quite some time now...let's just say he's had a long history of crazy talk so I have very little patience for his proclamations; as you said yourself, you did not go unscathed (as Super_dave asserts), and I did acknowledge prices have recovered, but that's not the same as being unscathed (in SD's words) in the 07-13 time period

    Let me know if you would like a tour of a walk of shame...and you'll really get to see some wild stuff from SD!
     
  17. Super_Dave

    Super_Dave Formula Junior

    Oct 6, 2014
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    You are right about both the nasty nature of the personal attacks and my point in my post re: NYC.

    I said "nearly" unscathed because it was more a 15-20% dip here from peak and then a relatively quick recovery. Compare that to the suburbs around here or almost any other market in the US and most have not recovered to prior levels.

    Cars like a 288 gto that were a benchmark car, a limited production run, and key developmental step forward, are imho going to command real money and if hit by a deflated market, are the kinds of cars I would expect to be real bargains if they drop materially.

    The stuff most indicative of pure bubble pricing is when a car is rare because of some rare feature (particular color, manual transmission) due to prior buyer demand and commands a massive value, or cars that did not command any premium at all a few years ago and are now two or three times their earlier prices.

    House prices in many regions before the last crisis skyrocketed in price not because of fundamentals but because of buyer psychology. NYC at least had strong fundamentals beneath it and so is supported on the downside. Co-op structure also helps because it slows the buying process and requires a much higher financial threshold (it also keeps selling prices softer because it lowers the buying pool).
     
  18. Ferrari 308 GTB

    Ferrari 308 GTB F1 Veteran

    Feb 21, 2015
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    Zzzzzzzzzzzzz...............
     
  19. energy88

    energy88 F1 World Champ
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    Over the last few posts, I believe we need to make a distinction between a "correction," a "crash," and "volatility." Everyone probably has their own view (definition) of each term.

    Paul's NY home price graphs in post #62 do indeed show a drop of about 27% (+/- 1%) and might be considered a "correction" in that market since this occurred over a 5-year period (roughly 5.4% per year). However, if the 27% drop had occurred over a much shorter period of time, say 6 months to a year, there might be good reason to label the drop as a "crash" or "bursting of a bubble." This is where volatility enters the discussion- extreme changes in price in a very short period of time.

    Some view a "correction" in a market as 10% while others may say 20% or more and view the condition as a buying opportunity rather than a cause for alarm if measured over enough time. Market recovery usually occurs thereafter.

    A "crash" (to me) is probably on the order of 50% to 70% and usually occurs in a short period of time and then can remain at depressed levels for years. The recent 70% collapse in oil prices in less than a year is a good example.

    I feel that we should be focusing on "volatility" in prices, both up and down. The Porsche market is probably the best car example on the upside; I don't believe that market has demonstrated the downside yet.

    My point is that any "meltdown" or a "popping of a bubble" in a market needs price "volatility" in a short period of time to be considered present.
     
  20. msn

    msn Formula Junior

    Jan 22, 2011
    250
    This tread can be debated from both sides of the fence , but evidence, and Im not talking the sub standard cars going to the auction houses in Arizona. this week Talacrest has posted that: Ferrari 250 SWB Speciale by Bertone finds a new home 19/02/2016 this car is a grade A example, its value is around 15 Million GBP if not more, also this week Graypaul Classics sold a 5K enzo for 1.8 GBP, Hr Owen Ferrari have sold a 33k 288 GTO for 2.2 GBP, the list is goes on. Tom Hartley have had a record month as posted on their site:Reflecting on January @tomhartleycars & yes I can confirm a "RECORD" month by our team ?tho well deserved by all��#&yeswhatafirm��
    3 retweets 15 likes
    Platini289 these are just a couple of the transactions that are happening at moment in the UK market and to me as a buyer and seller and collector of car's does not show a slowing market in the best cars.
     
  21. energy88

    energy88 F1 World Champ
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    True. Different layers of the Ferrari onion are trading at differing valuations now.

    This is analogous to what happens in the crude oil market at various stages of hysteria. Whenever there is a shortage, panic, or other unexpected event, the crappy-quality crude oils can approach the higher-quality oils in price to within a few dollars a barrel. Once the situation passes, prices revert to more traditional levels (ratios) and the spread between best and worst expands back to $10-$15 per barrel.
     
  22. msn

    msn Formula Junior

    Jan 22, 2011
    250
    Energy88 the same for Ferrari, spread between grade A and let's say B is 50 %
    The F40 that I am trying to buy is 1.15 GBP and can buy an F40 for 625 GBP but I would not want to buy it. So the spread is near on 80 %
     
  23. 166&456

    166&456 Formula 3

    Jul 13, 2010
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    The financial markets are still in a correction phase imho. From the highs the low was about 18% from the top, which is not nothing, yet far from dramatic. The indexes probably have some more to fall, it could be that the HS formation in the Dow takes us down quite a bit further. It might but doesn't have to.
    If it does, whether that should or will influence the classic car market, is anyone's guess.
     
  24. msn

    msn Formula Junior

    Jan 22, 2011
    250
    So you are basically saying that if the financial markets rally towards the year end, the classic Ferrari market will be saved. So everything is correlated in your view.
    Dow, ftse, nikkei, oil, property, rental market, art , precious metals.?
    I could not disagree more
     
  25. msn

    msn Formula Junior

    Jan 22, 2011
    250
    There is no correlation between stocks, oil and classics cars, the FTSE in 2000 was 7000, 16 years later it is 6000. Hard assets are the only way to stay ahead of the inflation game, house prices in the SE of England have trebled in that time.. The car market has just played catch up as people realised the pricing was incorrect.
     

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