Early 1990s crash of collector Porsche and Ferrari values...how did it happen?

its is a pretty good thread-even with the guys who are wrong

 

At the end of the day, someone should buy a car because they want the car. If they want the car because they love to drive it or because they want to look at it, it makes no difference. However, I don't think that anyone should buy a car with the idea of making money with it. That's my personal opinion.

As far as assets go, anything tangible that people want can be considered assets, whether they be stocks, properties, cars, potatoes, cattle, lettuce, etc. If people want to transition them into investment vehicles, that's where the danger lies, as has been discussed often.

At the end of the day, this thread is NOT about is it or is it not an asset class but beyond rational market movements (supply and demand), what caused the precipitous crash in 1990 (or thereabouts).

 

good post.

i remember the crash in 90, seems like a lifetime ago.

 

Another perspective here

How to invest in classic cars: From buying at auction to funds | This is Money

 

Is Jerry sensing a top ?

Jerry Seinfeld Is Selling His Million-Dollar Vintage Porsches - Bloomberg Business

 

doesnt he have like 200 cars?
selling 3 looks like housekeeping

 

Considering that he's still buying cars, I am guessing that "sensing a top" is the farthest thing from his mind. I think he probably is getting rid of some things he's not into any more. Besides, I am pretty sure he has another 550 and GS/GT. Not sure about the IROC.

 

Sounds reasonable

 

“I've never bought a car as an investment. I don't really even think of myself as a collector. I just love cars. And I still love these cars. But it's time to send some of them back into the world for someone else to enjoy.”

-Jerry Seinfeld on the sale of 3 of his 200+ cars



Also something tells me if the car market crashes - Seinfeld wouldn't even flinch (nor care) - he's worth 820 MM, 3MM obviously has no affect on him at all.

 

Whenever you see gimmicks like this, you know the top is either here or just around the corner.

This seems like the auto equivalent of the 125% L-to-V home refi that was so popular (and financially ruinious) a decade ago.

 

the Seinfeld sale is a conundrum, a lot to take away and potential fodder for the talking heads, depending on which way the bidding goes... will the sale results have enough weight to sway opinion ( regardless of direction ) in future sales... especially in light of current economic and commodity conditions

 

You know what I think should be the talking points of that? Not the "why" is he selling but what looks to me like unrealistically high estimates. Those estimates that Gooding put out seem very optimistic to me.

 

shouldn't exclude the "why", it is part of the conundrum... as are your thoughts about price estimates... lots of moving parts

 

Well, how would you find out the "why?" I don't know how you find out the absolute real answer. Therefore, I don't know that it's worth getting hung go on it. Besides, I don't know what one person's motivation for selling just a couple of cars out of his very expansive collection has a bearing on the rest of the marketplace. My opinion only. People are free to disagree.

 

I love this thread.

 

Great thread.

Couple things I will add/emphasize:

first, IMO it's true that the current run up of values is, in part, a function of our cheap money fiscal environment that the US Fed and many foreign governments are supporting. When easy money ends, look out...

second, IMO we are near or at the top in values. How else can you explain 348's and other mediocre cars doubling and tripling in value over the last few years? When even the average stuff balloons in price then, again, look out...

Just my 2 cents...

second

 

Ferrari Classic Car auction - Catawiki
Sale ends in twelve days and will give us a current watermark.
Agree interesting thread and sensible comments.
I have a Mondial in less than perfect condition, but anytime the F word comes up people go nuts despite protestations of dodgy fusebox and "its unpopular" and "badly proportioned etc". For the younger generation brands like Jaguar, Lancia or Alfa Romeo have very little cache in comparison, yet back in the eighties there was more parity. In fact back then Ferraris would have got a few s******s given they werent that fast and badly made. Add in the BRICs market and the internet millionaires, im prettty sure there are people who will find room in a garage for them.

 

Apparently the articles are just highlighting some of the cars Seinfeld is considering putting up for sale. He has (I believe) around 60 or 70 Porsches. According to the article below, the sale is for 18 cars, not 3. So somewhere between 1/4 to 1/3 of his collection.

https://news.classiccars.com/mckeel-hagerty-talks-mona-lisa-cars-mustache-muscle/

 

initial reports were ( admitted ) teases showing 3 cars, with additions yet to be decided, the current reported count is at 18 cars

 

CNBC did a story on slow sales in Arizona. Claimed it was the softening of oil prices that has stalled the bubble. Said it was oil people that had had tons of cash. I picture Oil workers driving Ferraris to shale wells. LOL

 

May be some truth in that... Not so much the rig workers but the support companies were making a lot of money until recently...

I have a friend that developed fracking equipment that was more mobile than everybody else's and made a lot of money very quickly. He bought the Tucker a couple of years ago at Barrett Jackson for $10 M (or there abouts).. He isn't buying any big ticket items right now...

 

Curiously, does anyone know if Steinfeld owns a 1975-1977 Porsche 930 Turbo? I have always wondered.

 

I have no clue how many cars Seinfeld has. I've seen different numbers thrown around from a low of 18 to a high of 200, and always just Porsches (never mentions other makes) Assuming it is 60 you believe. 3 cars is nowhere near 1/4 or 1/3

3/60 = 5% of his collection (just Porches) not 25% (1/4) or 33% (1/3)

Of course the Seinfeld sale was mentioned as flame for bitter moths...

and how quickly they would pontificate on the gravity of his decision to sell 3 of his cars...

 

The CNBC story was probably referring to the Barrett-Jackson Auction where a lot of muscle and nostalgia cars were crossing the block in the $30-$50K range:

"Collectible-car experts say many of the buyers in Scottsdale in recent years were oil and gas workers who had extra spending money and were willing to plunk down tens of thousands of dollars for a 1960s Impala or 1970s Dodge Charger."

Aside from rig workers, other oil & gas occupations such as Landmen, Reservoir Engineers, Geologists, Traders, etc. command excellent incomes and could easily afford an incremental $30-$50K classic car but were probably worried about another down leg in oil prices and were being prudent about their personal finances.

 

Thank you for pointing out that my math was incorrect when I said that the link suggested he was selling 18 of his cars, not just the 3 previously discussed / highlighted, and that 18 of his ~60-70 cars constitutes approximately 1/4 to 1/3 of his collection.

I do have difficulty with math, it is not my forte.