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Saturday, January 7, 2012

The Rush out of Paper


Fearful Investors Stash Money in Luxury Goods

By Nils Klawitter
Photo Gallery: Investing in Luxury Items
The uncertain financial markets and the euro crisis have left many Germans feeling nervous. Worried about the security of their savings accounts, increasing numbers of people are deciding they would rather invest in material goods like art, vintage cars and real estate instead. But experts warn that nothing is 100 percent safe any more.
Franz Herrmann, head of the German Association of Savers (BDS), has spent half a century trying to be a good investor. As a child, he filled piggy banks and, as an adolescent, he put money away in his savings account. Later came a building loan contract, in addition to 12 life insurance policies. "Money attracts money," his father liked to tell him, quoting a German saying. "I was hardwired for saving money," Hermann explains.

At 52, he says he figured out "what's going on." He'd earned money through his business selling beer steins and jewelry in Munich's city center. But he became convinced that he'd actually lost money through his savings efforts and cancelled his insurance policies, while the small interest earnings from his remaining savings accounts were "eaten up by inflation," he says. To fight back, Herrmann formed the BDS. Now he makes appearances around the country, warning of "money-destroying instruments." He's certain that saving is "state-sanctioned robbery."

News and updates on the global diamond industry.
Who Is Pushing Up Diamond Prices?
  November 22, 2011 – 10:46 am
Yet another world record diamond price was achieved last week at Sotheby’s Geneva Sale of Magnificent Jewels continuing the spate of world record prices for diamonds achieved over the last two years. The surge in diamond prices in the face of the overall turbulent economic environment has grabbed the headlines and has left many analysts left to grapple with why diamond prices continue to rise during such uncertain economic conditions. 

The Wall Street Journal

The Wealth Report
Robert Frank looks at the culture and economy of the wealthy.

Are the Art and Wine Bubbles About to Pop?

One of the paradoxes of the wealth recovery is the collectibles market. While yachts, planes and mansions are stuck in a slump, collectibles are raging. Prices for the best-known fine art, wine, vintage cars, stamps  and antique jewelry have all surged after a taking a brief pause in 2008 and 2009.

Christie’s: Edgar Degas’s ‘La Petite Danseuse de Quatorze Ans’
The auctioneers and dealers tout collectibles as a better and more secure investment than stocks or bonds.
“Collectibles have become a viable and serious tool for investment diversification,” Jim Halperin, of Heritage Auction Galleries told Bloomberg. “I’m investing my own money in art and collectibles, right alongside public stocks, private equity, business loans and real estate.”

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