Thread by @deepakvenkatesh

1/ A thread about how Swiss Watches are used a currency & some interesting facts 😊

This article is across WA groups & Social Media. I wanted to share what I learnt & 'saw' how Swiss Luxury Watches are used in Europe specifically Italy.

bit.ly/2OxhcNC

2/ After WW2 in which Italy was a part of the Axis group it was in economic shambles. But in late 50s a golden period for the economy began. This period lasted perhaps into the late 70s & 80s. It was called 'miracolo economico' meaning the Miracle Economy!

3/ A person who spent over a decade once told me - It's easier to pull money out of a crocodile's mouth than from the pocket of an Italian. In many sense they are one of the most street smart people out there. A passionate lot in whatever they do be it good or bad!

4/ With growing incomes across professionals & corporates there was a 'need' to save on taxes. The route was to not leave a paper trail, a record of financial transactions.

5/ With tax evasion as one key financial crime a 'Tax Police' was formed in late 50s/early 60s (though it existed in a different form before). It exists today as the 'Guardia di Finanza'.

6/ The Guardia are quite feared & have had some exceptional uncovering. In a recent instance they caught 13k tax dodgers. bit.ly/2S5C4O5.

They even caught Maradonna when they saw him wearing 2 Rolexes! bit.ly/3bjjnOn

7/ So how were the Italians across the country be it the industrious Lomabardi in the north or the Southern Italians & Central Tuscans evading? They were using high end luxury watches apart from jewellery just like Mr Hand of God.

8/ Italians don't have many great watch brands perhaps other than Panerai, the one Sylvester Stallone wears. They were dealing with exquisite Swiss Watches be it Patek Philippe, Audemars Piguet, Jaeger-lecoultre etc

9/ Land deals, lawyers, accountants & even artists(note even a plumber is considered one as his job involves shaping things with hands in Italy) were receiving payments set in watches. The brands, model, year (reference no.) & any special association was pre decided for the job.

10/ Post payments the new owners would store their watches away from the preying eyes of plain clothed Tax Police. It was a win win for the transaction parties.

11/ If one needed to encash it was a short trip to Switzerland. For instance a train ride from Milano Centrale to Lugano (a beautiful Swiss town on Swiss Italian border) takes 60 minutes. One would fix the date & time of transaction with the Swiss dealers & make the exchange.

12/ There were professionals who had amassed 100s of these watches. Infact some had their own private collection of Pateks by the late 90s & 2000s. Once burglary cases started going up in late 2010s then it became a concern.

13/ The generation which had done this are into their 80s & 90s and if you are lucky to be close to one your eyes would pop open when you see a cupboard full of rare old Swiss time pieces.

14/ Why did they do this apart from tax evasion? These watches held their values and some specific pieces even appreciated. For instance the most liquid model became the Patek Philippe Nautilus line.

15/ Hand crafted ones had higher value but lower liquidity. Certain brands never appreciated such as an Omega unless it was a special make. The best cheapest watch was the legendary Rolex Submariner.

16/ If you own such a watch in India & visit the usual Indian stores you will never get the requisite value. You need to find the right seller. Therefore in a country like ours its not investment grade. We still like our real estate.

17/ So what is the old generation of Italian watch holders doing?
Just like Patek Phillipe says - You never actually own a Patek Philippe. You merely look after it for the next generation

18/ So can Apple watches serve this purpose? Or the 'need' of these exquisite Swiss watches will eventually fade away? No one knows the future but as the Swiss luxury watch pieces reduce in size the value will go up even more. That's my hunch.

19/ Dont ask how I know all this else the Guardia di Finanza folks might come 😉