Hermes, the handbags to wear during the class war


Next up, a story that’s so revolting that you may be revolting by the time you’ve finished watching. . .

What’s the ultimate in plutocratic investments?

One that consistently outperforms all the rest?

Diamonds? Private islands? Picassos?

Nah, it’s purses.

Really.

From the Wall Street Journal:

The iconic bags made by Hermes that trade for a quarter of a million dollars.


The details from Barron’s:

Baghunter, an online platform trading in luxury handbags, compared an investment in Hermès Birkin handbags with the Standard & Poor’s 500 and gold between 1980 and 2015. Birkin’s equestrian-inspired bags had an average annual return of 14.2%, compared with 8.65% for the S&P 500 and 1.9% for gold. Incredulous? The Wall Street Journal reports that a billionaire paid $298,000 in March for a fire-engine-red crocodile Birkin with 18-karat white-gold hardware and 10.08 carats of brilliant-cut diamonds. In 2008, that bag was purchased at an Hermès boutique for $160,000, and, in 2015, Christie’s sold a similar, fuchsia version for $222,928. Leather Birkins start at about $10,000 when purchased at an Hermès boutique, although only top clients are given the chance to do so. When they hit the secondary market, they usually trade at two to three times that price.

Diane D’Amato, director of luxury accessories at Heritage Auctions, says her firm scours the world in search of the bags, and will even hunt a specific model requested by a client for a private sale. The next Heritage auction is in September. Pristine special-order bags (bicolor or tricolor) in addition to exotic skins (crocodile, alligator, lizard) and select colors (“So Black”) are in highest demand. “The best bags to invest in are unusual or unique pieces, either limited editions or special orders,” D’Amato says. We wonder if it’s time to short the carryall.

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