To sell the family silver and jewels always sounds like the ultimate fallback when the economy is vanishing, the income stream dries up and the beggar on the street sends chills up the spine.
The question that never gets asked when the beloved buys baubles is, "Can I dump these at more that a fraction of the price if he dumps me, and if so, where?"
I've learned a little about the process lately, and thought I'd pass a few cautions along.
You might think the jeweler where you got them in the first place would be a reasonable place to start. Uh-uh. Chances are, they won't touch that. They have a near-religious taboo against having the same piece reappear in their display cases.
If you bought from a big-name bling house, they might take it on consignment on a no-fee basis, but at a shockingly lower price than sticker. That $180,000 piece might net you $8,000, if it ever sells.
Your friendly retailer might suggest a buyer in the Gold District. This very knowledgeable fellow will get out his magnifying loop. He will look over your treasures. He will ask you what price you had in mind for the lot. You will name a price you think ridiculously accommodative, given what was paid, what it was appraised for, what similar pieces sell for now.
He'll shake his head and protest that he can't possibly insult you by quoting you the price he would actually pay. You will press him. He will name a price, and you will feel your knees grow weak.
Unless your bling bears a really fancy name -- Tiffany, Buccellati -- chances are high that the buyer will actually turn down your treasures. "Far East stuff," he might say, pointing at a sapphire bracelet for which your formerly beloved paid a sum equivalent to a year's salary for the average doorman. "Lots of carbon," he will shrug at your diamond necklace.
A seller determined to press on should get a couple of quotes. There is nothing, after all, like competition.
If selling through a reputable auction house seems like a better option (excuse me while I pick myself up from whence I fell on the floor after writing "reputable"), think twice. Or, better, stop thinking about it. If your stuff doesn't sell, you'll still be liable for, oh, insurance, advertising in the glossy brochure, storage, transport, reserves -- on and on and on, and not only will you have not recouped any of your investment, you'll have lost money. Unless, of course, you're a celebrity, in which case your trash is cash.
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- Laurel Kenner
- Laurel Kenner is co-author of an acclaimed book on investing, “Practical Speculation” (Wiley & Sons, 2003) and founder of “Daily Speculations,” a forum for an international network of contributors attracted by her financial columns for Bloomberg News, thestreet.com and CNBC Money. With her former partner, Victor Niederhoffer, she has delivered guest lectures at Yale, Wharton, the London Business School and the University of Vienna’s Institute for Capital Market Research. Ms. Kenner has worked as a reporter at the Los Angeles bureau of the Associated Press (1987) and at Copley Los Angeles Newspapers (1988-1994), where she gained national attention and several awards for her coverage of the military space industry. From 1995 to 2000, she managed stock market coverage at the New York bureau of Bloomberg News. Born in California, Ms. Kenner studied piano with renowned teacher Aube Tzerko and performed professionally before shifting her focus to writing. She lives in New York City. Ms. Kenner plays chamber music and is co-founder of Kenner, Kinder & Liebhaber, a living-room concert series that welcomes children to classical performances.
1 comments:
Your observations are accurate, but I disagree with one statement in your post.
Stones are a fairly "efficient" market except for their horrendous (10% to 50%) bid/ask spreads. Likewise, gold, silver and platinum are efficient markets with perhaps a 10% bid/ask spread. The bid/ask spreads are particularly wide right now due to a lack of credit (from companies such as CIT) to the trade.
Unfortunately, the value of the "setting" to a wholesale buyer is just the value of the metal (unless it's a serious name brand). Kind of like book value for a value investor! But when people buy rings, bracelets and necklaces at Tiffany, they often pay 300% of the wholesale value of the stones. And they may pay multiples of that for the value of the setting.
You write: "That 180,000 piece might net you 8,000 if it sells." Here, I must express dubiety. If you paid 180,000 CASH for a new diamond necklace at a legitimate jeweler, the stones should fetch at least $50,000 (from a dealer) and the setting would be worth a few thousand more. I would pay $8,000 for such a piece sight unseen!
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