The final board meeting in London of the Lux Timepieces III Fund had been a stormy one. Principal investor Igor Abramovich had flounced out after throwing his Roger W Smith Series 1 on the boardroom table, where it shattered into dozens of meticulously handmade pieces.

Going down (image courtesy NewsBTC)

The highly leveraged fund was by any definition flat broke, sitting on a mountain of bank debt as well as several hundred pristine “safe queen” timepieces ranging from Audemars Piguet, Patek Philippe, and Rolex to Philippe Dufour, F.P. Journe, and MB&F stored in the same bank’s safe deposit boxes. And all now repossessed by said bank.

Tiffany & Co Double-Signed Patek Philippe Nautilus Reference 5711/1A-018

Many of the fund’s horological assets had been acquired for seven-figure sums at overheated global auctions in Geneva overseen by master auctioneer Aurel Bacs. Back in the heady days of the Tiffany & Co double signed Patek Philippe Nautilus Reference 5711/1A-018 and other marvels, with local buyers in the room competing with telephone and internet bids coming in from Hong Kong, Dubai, London, and New York. After all, the fund’s management and investors reasoned, they could only go up in value, couldn’t they?

Darius Hambring had launched the original venture, Lux Timepieces I Fund, back in 2021 after a boozy dinner with his gang of fellow well-heeled watch collectors at the London branch of Nusr-Et, Salt Bae’s gold-plated steak restaurant, the highlight of which was a high-net-worth sexpile of Royal Oaks and Nautili over which the Turkish-born Salzmeister himself had (for an additional fee) performed his much-Instagrammed forearm ritual, this time using pink Himalayan salt.

During the dinner, Hambring had drawn up a business plan on a paper napkin and within 48 hours he had raised a seven-figure sum from his fellow diners to fund his first horological spending spree. Footing the bill at Nusr-Et that night (including a slightly corked 1967 Pétrus) had all but wiped out Hambring’s personal savings, so his initial stake amounted to a paltry £2,000. But he controlled the company’s checkbook.

Now he was on his way home to break the news to his wife that their Knightsbridge home (and the Tesla he was driving) were no longer theirs and that from September the children would be attending the local secondary school rather than rubbing shoulders with Princes George and Louis at Eton.

To make matters worse, over the last ten years Hambring had invested every spare penny of his own – actually his wife’s – money on his own personal passion: contemporary handmade English watches, including a brace of George Daniels pieces.

He had also rather foolishly decided to singlehandedly corner the market in Birmingham-based Struthers’ Project 248 in-house movement models, buying up the entire second-production run of five watches using a loan secured against his aforementioned Knightsbridge home. He had then sold put options on all five watches on Chrono24’s new multilateral trading facility, betting that they would go up in value. Oh, yes, he had skin in the game.

On his way home, Darius dropped in at Stimler’s, one of his dealer friends in Hatton Garden, and reluctantly handed back his recently acquired 1967 Marine Nationale Tudor Submariner (£250,000 payable over ten months had seemed a fair price at the time, even for an ETA movement). Stimler winced when he saw him coming through the door, but in the current market he would rather have the watch back than pursue a bad debt.

It was 7:00 pm when Darius finally eased the Tesla into the carpark beneath his home. On his right wrist his Apple Watch flagged up that his heart rate had been “high” for several hours. He sighed. Where had it all gone wrong?

o o 0 o o

There had been warning signs. Here and there, in various cities around the world, a Nautilus or Royal Oak would appear briefly in an authorized dealer’s window. And then Submariners and Sea-Dwellers started appearing in shopping malls, causing some to rethink their definition of “mall watch.”

Rolex Oyster Perpetual 41 in turquoise blue

For some in the industry, the tipping point was when U.S.-based collector and photographer GaryG sold an NFT of his “Tiffany-blue” Rolex Oyster Perpetual for more than the watch itself would have fetched in the open market. Suddenly, in a seismic shift replicated in numerous collectibles markets across the globe, digital versions of luxury watches were worth a multiple of the underlying timepiece.

For others, it was when a leading auction house sold an iconic Patek Philippe for an astronomical sum and the buyer – reportedly – failed to come up with the cash; several weeks later the firm covered up its embarrassment by selling the watch to the “underbidder,” who happened to be one of its own staff.

Shortly after that, journalist Nick Foulkes wrote in the Financial Times that luxury watches “were no longer an asset class.” And all hell broke loose.

In scenes reminiscent of the 1987 and 2008 stock market crashes, the screens on Chrono24’s multilateral trading facility turned red for the first time ever as investors, collectors, Instagrammers, and YouTubers ran for the exits, rushing to offload all the watches they didn’t need and had bought with money they didn’t have.

Only Seiko and Casio survived the bloodbath, as the Seiko 5 and the $99 G-Shock swiftly became the “smart watches” to be seen wearing in the circumstances. The “smart money” had moved on to things like Banksy paintings, all-original, unmolested 1940s British and American fighter planes such as Spitfires (£4.5m) and Mustangs ($3.5m), and the aforementioned NFTs.

Soon the ordinary man in the street was caught up in the frenzy, pulling grandad’s vintage Rolex out from the back of a drawer “while it was still worth something.” The new, second hand, and vintage markets were flooded.

At the front door, Darius picked up a wad of mail from the doormat. “Congratulations, Mr. Hambring! It’s time for your 25^th COVID booster jab!” announced a letter from the local health center. He swore gently under his breath.

Sharmila and the boys were hunched around the kitchen island, each engrossed in their personal connected devices and tucking into their respective robot-delivered Uber takeout deliveries. “Good day at the office, dear?” enquired Sharmila without looking up from her screen.

Darius grunted. Maybe this wasn’t the right time to give them the bad news. “Think I’ll just go and take a nap on the sofa.”

Just then there was a loud knock at the front door.

He opened the door to find a petite, irate-looking woman of pensionable age. “You mountebank! You thieving scoundrel!” she shrilled. “My pension adviser invested my entire life savings in your damned watch fund! What am I supposed to do now? I can’t eat my Rolex!” she shrieked, brandishing a green-dial “Stella” Oyster Perpetual in his face, a 1972 Day-Date by the look of it, thought Darius, distractedly.

The woman stepped forward and grabbed him by the forearm and began shaking him violently.

“Darius . . . Darius . . . DARIUS, WAKE UP!”

It was Sharmila, shaking his arm as they lay in bed. “You were having a nightmare, darling. Muttering something about Royal Oak futures and an old watch lady . . . ”

“Is everything okay at work?”

Darius looked over at the nightstand and breathed a sigh of relief: the 1967 Tudor Submariner was in its usual place.

“Couldn’t be better, darling!”

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