Whisky – a “Robust" Investment?

Would you pay $20,000 or more for a 50-year-old Glenfiddich? How about this high-design bottle of Glenlivet, with contents that date back to the Battle of Britain?

Welcome to the world of collectible whisky. Sotheby's offers this aspirational guide.

To those of us who go into shock at the price of a decent 12-year-old single malt, the notion of collecting rare bottlings seems daft. On the other hand, the everyday bottles on your liquor store's shelves might not be a bad investment. On October 18th, whisky and other European luxuries are due to be hit with a  25% tariff.

“The Biggest Blunder in Recent Auction History”

"Anything that can go wrong, will go wrong." It's Murphy's Law.  He may have been in the audience at this weekend's RM Sotheby's auction of "the first Porsche."

To begin with, this little 1939 race car wasn't really a Porsche. That brand wasn't launched until after WWII. Ferdinand Porsche, who designed the vehicle, called it his"ancestor" Porsche.

Produced to represent Nazi Germany in a Berlin to Rome race that was cancelled when war broke out, the so-called Porsche Type 64 is more like a Volkswagen, built on the chassis of what would become the VW Beetle and powered by a souped-up VW engine. Over the years the vehicle has been significantly restored and modified. Still, it's one supercool-looking pre-war race car.

On Saturday, August 17, the almost-Porsche was put up for sale, at an expected price of $20 million or more, at RM Sotheby's auction.

And so began "the biggest auction blunder."

This is the only surviving example personally driven by Ferdinand Porsche,” the evening’s emcee said, then announced that bidding would open at “$30 million,” a figure that was written on the front media screen of the auction theatre. Half of the crowd laughed; the other half cheered. After rapid bidding up to “$70 million,” with the crowd on its feet, iPhones raised, and cheering, the auctioneer announced that he had meant to say “$13 million,” and then “$17 million,” rather than 30 and 70. The media screen was quickly changed to reflect the $17 million sum.

Boos and shocked yelps and shouts ensued. People walked out.

At $70 million, the pre-Porsche would have been by far the most expensive vehicle ever sold at auction. At the actual final bid, $17 million, the reserve price was not met. So, no sale.

Famous Owner? Bigger Bucks!

Three factors are said to determine the value of real estate: location, location, location.

When art and collectibles are auctioned off, the prices they fetch also reflect three factors: provenance, provenance, provenance.

This BMW Z8, for example. At an upcoming auction it might sell for $200,000. But because its first owner was Steve Jobs, it may fetch as much as $400,000. (If Steve had been more of a car buff. expectations might be even higher.)

Paul Newman drove race cars. His wife gave him a Rolex Daytona. How much did that provenance add to the value of the watch? A lot. This month the coveted chronometer sold at auction for $17.8 million.

A Better Store of Value?

Monets and Warhols stowed in free-port warehouses serve as stores of value for the world's superrich. But where's the fun in owning art you can't look at?  Rare stamps have long served as a superior form of tangible wealth – easy to store, easy to hide, easy to carry across national borders.

“Stamps have a parallel quality to fine art," says Charles Hack, who collects both. Like art, rare stamps sometimes have noteworthy provenances.

The inverted Jenny, for example. This now-famous stamp was the Bureau of Printing and Engraving's second attempt to print postage in two colors, The first try hadn't gone well. Printing of the Jenny apparently went better, except for mishaps where the plane was printed upside down.

Colonel Green

Purchased by a prescient collector for face value, a sheet of 100 inverted Jennies passed to Colonel Edward H.R. Green, son of Hetty Green, The Witch of Wall Street. After numbering the stamps in pencil, 1 to 100, the Colonel separated the sheet into 25 sets of four.

In May one of the inverted Jennies sold for $1.35 million. Another, shown above, recently turned up in a stamp collection that an Irishman inherited from his grandfather. Thanks to Green's numbering, it was identified as one of a set of four stolen from an American Philatelic Society convention over 60 years ago.

Instead of a seven-figure bonanza at auction, the Irishman has to settle for a $50,000 reward.

Seinfeld's VWs as Tangible Investments

A good number of classy collectible cars sold for less than their estimates at Gooding's Amelia Island auction. The softening in the market for tangible investments such as art apparently extends to Ferraris as well.

Nevertheless, humble VWs from Jerry Seinfeld's collection did surprisingly well.

For instance, this 1964 Camper (I love it!) sold for $99,000, at the high end of its estimate.

Seinfeld's 1960 Beetle, owned for 30 years by a school teacher and driven for less than 16,000 miles. did even better. Expected to sell for $50,000 or so, it fetched $121,000.

Volkswagens may look out of place among Duesenbergs and Aston Martins, but as this 1966 VW ad says . . .

Freeport Tax Havens?

Imagine places where investors with overstocks of fine art, gold coins, historic tapestries or vintage automobiles could sell or swap their hard assets without worrying about taxes.

Such havens may exist in Luxembourg, Geneva, Singapore and other free ports, The Economist reveals: : Uber-Warehouses for the Ultra-Rich. 

Nikolai Breaks the Bank!

Remember An Estate Treasure Named Nikolai? The Fabergé portrait of the personal bodyguard of the last Czarina of Russia proved to be precious indeed.

Estimated to sell for $500,00-$800,000, Nikolai did much, much better. He fetched $5.2 million!

You can read about the provenance that made him such a treasure here.

The Chamber-Cossack named Nikolai.
His eyes are sapphires. His beard is Siberian jasper.

An Estate Treasure Named Nikolai

IRS audits and feuding heirs can make estate settlement a thankless job. Once in a while, happily, some forgotten treasure turns up in a barn or attic to enliven the process – a Duesenberg perhaps, or a Picasso.

In the estate of an unidentified New Yorker, the attic treasure is a rare portrait statuette by Fabergé. 

Meet Nikolai Nikolaevich Pustynnikov, personal bodyguard to Alexandra, last Empress of Russia.

The Nikolai statuette –his eyes are cabochon sapphires – was part of the Czarist loot the Soviets exported in the 1930s to obtain hard currency. Brought to the United States by Armand Hammer, it was sold to the New Yorker's mother-in-law in 1934. Apparently Nikolai was exiled to the attic for so long that Fabergé historians assumed he was lost forever.

A similar bejeweled statuette, portraying the bodyguard of Alexandra's mother-in-law, the Dowager Empress, stands guard in a St. Petersburg museum. As for Nikolai, when he marches onto the auction block October 21, he is expected to earn the estate at least $500,000.

Update: The auction is scheduled for October 27-28.

Are Apples Collectible?

Christie's thinks so. First Bytes, an online auction, features this Apple-1 from 1976, the first product of the Apple Computer Company.

Also up for bid, and considerably cooler, this 20th anniversary Macintosh from 1997. Features include leather wrist-rests and a Bose sound system with external subwoofer.

The online auction ends July 9.

Did You Save Your Confederate Money?

At the NY Times store, this $500 Confederate bond goes for $340. Not face value, but still . . . .

Auctioning Brooke Astor's Stuff

Next month Sotheby's will auction off items from the late Brooke Astor's Park Avenue duplex and her country place, Holly Hill. Above, a detail from her portrait by Aaron Shikler,  expected to fetch $10,000-$20,000.

Below, a portrait of an Aberdeen Angus bull by Herbert Haseltine. Like Shikler, Haseltine was popular with the high-society set, and Astor owned a number of his bronzes.

Will collectors be eager to acquire Astor's knick-knacks? We'll see.

Why Executors Always Should Look in the Barn

After the death of Baroness Gisela von Krieger in 1989, lawyers settling her estate found this remarkable asset in the family's Greenwich, CT barn.

At Gooding's Pebble Beach auction, the 1936 Mercedes-Benz 540 K Special Roadster sold for $11,770,000. You can read all about the car – only 30 were built and perhaps a dozen survive – and the Baroness here.

Buy Madoff's Bull?

A lot of investors are sorry they bought Bernie Madoff's bull. Perhaps you'll have better luck with this little bronze. The bull is up for sale November 13, when the U.S. Marshalls auction off 400 Madoff items.

This Bear Market is Really Nice

"Rich." "High Net Worth." We toss those terms around as if wealth were stable and easy to value. Ha! Priced Florida condos or Arizona tract houses lately?

Yet if some of yesteryear's six-figure assets are now worth little, items once purchased for a pittance may now represent real money.

Paul Greenwood, who turned a hedge fund into "sort of a Ponzi scheme," spent $3 million of his loot on old teddy bears. Tomorrow Christie's auctions them off, including this distinctive Steiff harlequin bear.

For another glimpse of old stuff that now possesses significant value, see The Telegraph's Rare and Unusual Ephemera for Sale.

Who knew an autographed color photo of Nixon was a collector's item?

Moral: Name an experienced trust bank as your executor. A trust officer will seek the expert advice necessary to determine that your comic book collection is now worth more than your Vegas penthouse.

Where the Monied Are

Seeking movers and shakers capable of putting big money into private equity or charitable remainder trusts? Try the Pebble Beach Concours d’Élégance and the assorted races, auctions and frivolities that surround it this weekend.

My favorite vehicle up for auction (Gooding & Company) is this 1933 Bugatti.

Whoops! Just changed my mind.

Look at this amazing French postwar masterpiece, the 1949 Delahaye shown below. RM Auctions expects it to fetch $4 million to $6 million.

1949 Delahaye Type 175S Roadster

Update: The Delahaye, once owned by Diana Dors, "Britain’s answer to Marilyn Monroe," sold for a bit less than hoped for. It fetched $3,300,000.

Perhaps buxom blondes prefer other types of fun these days.

Treasures in your clients' estates?

Collectibles and stuff can be worth a lot these days. Case in point, the life-size bronze of a girl holding a sundial shown here. Five or six copies of the sculpture, created by Harriet Whitney Frishmuth, were cast by Gorham in the 1930's. The provenence is uncertain, but this one just may have decorated the grave site of my wife's Wall-Streeter grandfather, who died in 1939, before passing through the hands of various collectors.

Today at Sotheby's auction of American art, Roses of Yesterday was expected to fetch between $300,000 and $500,000. She did a bit better than that, selling for $632,000 including buyer's premium.

Some treasures aren't obvious, allowing them to be thrown out in the trash when a home is cleaned out after Grandma dies or moves to a nursing home. This Wall Street Journal article cites an instance where a son threw out the family silver.

An earlier Journal article reports on an executor who junked a collection of antique sewing machines, only to find the collection was worth over $60,000.

Sometimes even junk isn't junk. Not since eBay. See this recent post on Death and Taxes.