This was an interesting glimpse into a world I can’t even imagine.
What do the costs for “real” luxury bags even go to? Some of them apparently cost hundreds of thousands of dollars. It’s enough for two artisan workers to collaborate on making a single bag a year, then rest in a comfortable lodge in the Swiss alps until they make a single bag next year.
I can understand luxury car prices, to an extent. There’s engineering and material prices that surely can’t be cheap. I can’t understand a piece of cow hide going for the same price.
Most luxury bags are a few grand tops, not 100s. I'm sure they exist but that's not the norm. That's like someone buying a custom made $10 million Ferrari. Very rare.
Almost a classic example of a Veblen good. The demand doesn't increase uniformly as the price increases, but they'd probably sell fewer if they cut the price in half.
They've clearly found the sweet spot in the overall profitability curve, somewhere in the six-figure range.
alar44 is not talking about Birkins when he says 'Most luxury bags are a few grand tops, not 100s...' but the LV's, Gucci, Burberry bags most people with branded handbags have. Birkins are another class of their own.
Isn's this the last 20% of performance being expensive and the last 1% prohibitively so? I imagine for high-end leather, you are raising 10 animals for 1 ending up having skin without any bruises etc.
Speculation: Then, in the end, this explains maybe 1/3 of the pricing, the next 1/3 is marketing (prime real estate in metropolises, extensive sponsoring, one store employee per customer, a doormen, ...) and finally some nice profit margin, looking at you LMVH.
An iPhone is also quite a technological challenge, yet Apple doesn't spend nearly as much making it as people are willing to pay. Same goes with these bags, they are a luxury item that people will pay far over the production cost for. You literally buy them to show how much money you have, so it's the brand doing most of the work, and the bag-making process just needs to be somewhat professional.
From what I gather the factories in China that make the real thing will also make extra copies of the real thing, thus making it extremely hard to tell the difference.
The social element is maybe the most interesting, it's like a hobby for these ladies. What I've noticed through my life is there's always people who do some kind of cottage buying-and-selling on the side: friends who buy luxury watches, collectible cards, used cars, restoring old laptops. There's something universal about that instinct. Being socialites it makes sense they gather about this particular thing.
> The Hermes bags are made in France, by leather artisans.
And yet ironically in the article,
> She echoed a number of women I spoke with who think authentic customers are the ones getting played. “These days, the reps just tend to be better made,” a Hamptons-based chief strategy officer tells me. “They last longer. There’s more attention to detail. You can tell that things have been done by hand.”
I remember reading an article about attempts to defeat counterfeiting of native American jewelry in the southwest. I guess people in Mexico were making their own versions cheaper and then shipping them in undercutting the people who made them on reservations. At first it was pretty easy to sort out the fakes but the Mexican manufacturers eventually improved their process so much no one could even tell the difference anymore. Which brought up some interesting questions about what authentic even is in this space.
The Chinese are just next level when it comes to the work ethic in learning every little detail about a particular product and applying techniques to improve. Their EV offerings will probably be very competitive once they hit the US.
The comparison to the iPhone doesn’t make sense to me. Who is buying iPhones just to show off? They’re not that much more expensive than flagship Android phones.
> They’re not that much more expensive than flagship Android phones.
You sure the women in the article don't think the same way about the bags? The price difference between a working Android phone and top of the line iPhone is around 10x as well.
Its not a great comparison. You might as well get a flip phone, the price difference can be even greater. A better argument is that you are paying for access to iOS which makes more sense.
So tired of hearing this argument. What ever happened to just wanting a reliable phone that works well? Many Android -> iPhone users have been burned by the numerous amounts of garbage that has come out of that ecosystem over the years. Its not always about "status symbol". Hell the cheapest iPhone is 429$ today. And that gets you their top of the line CPU that essentially blows away Android at any price. This isn't "status symbol" just immense value.
It used to be a big status symbol, but they've become more mainstream now. People will still look down on people using Android phones though.
related: Beats headphones are / were a status symbol, as are airpods. The kids want airpods. People want to be seen wearing airpods. People want to be seen.
Someone I knew worked in a very expensive jewellery / leather shop in London called Aspreys in the late 90s. A family walked in and within ten minutes had picked out and paid for a £10,000 luggage set. There's a bunch of people around - probably even more now given the rising levels of wealth inequality - who can do that kind of thing without thinking. That family probably shopped there without thinking too much about what things cost, they just knew that they liked what was in Aspreys.
Two centuries ago this would be the only customer type there was. Back when there were no middle class and the only buyers in some goods were the aristocracy and some nouveau riche.
I could perhaps have been clearer about the kind of inequality I was talking about - intra-national - but at the very best it's been flat over the last few decades: https://www.economist.com/briefing/2019/11/28/economists-are... I personally don't really buy the post-tax rationale presented in that article though. Pre-tax is more interesting to me in that it's where the money is, not how much spending power people have after tax.
Keep in mind that you get different results looking at income distribution vs wealth distribution.
Also keep in mind that because so much of the wealth of the very rich is tied up in assets like shares, the wealth share of the very rich takes a (comparative) nose dive whenever the economy enters a recession. Their wealth and income drops dramatically more than that of your rank and file employee, or that of someone on government handouts.
Absolutely, the rich are still rich and the poor are still poor in a recession. but on paper the gap between, say, average and top 0.1% narrows.
And, obviously, recessions are bad for both poor and average people. But you wouldn't get that from looking at inequality.
Just another reason to focus on absolute numbers, instead of whether the Joneses have more.
Btw, why do you want to focus on where the gross money is, instead of what you can buy after taxes with your money? People don't eat money, usually.
In Geneva, there is whole range of shops no locals are buying anything, ever. I mean no local swiss bankers, Procter&Gamble global managers, UN high bureaucrats, nobody. Its just that ridiculous.
But every summer (apart from recent covid ones), whole planes come from Arabian gulf. Planes full of ferraris and lambos, so you suddenly see (and hear) a lot of arab plated cars in central europe. These people shop as you describe - come to ie Versace or Piguet shop because its just by the lake, spend ridiculous amount and go to next shop.
Basically these few weeks enable those shops to survive for rest of the year since rentals are crazy.
I think how much time and thought you put into buying things is an inverse parabolic curve. If you don't have much money you put a lot of thought into every purchase, because you have to balance your money to make it cover everything you need. If you have massive amounts of money you also put a lot of thought into every purchase, because you generally only buy things that require a lot of thought (houses, yachts, art, etc). It's the people in the middle who go into shops and buy $10k luggage sets - enough money to cover all their needs easily, but not enough money to be buying things that you need to consider.
Essentially, if you have actual FU money, you're not spending time going to a shop to choose your own luggage. You probably don't even see your luggage. An assistant packs your stuff, a driver puts it on your plane, and a hotel worker unpacks it at the other end. Your luggage is probably some completely boring, utilitarian metal box designed to keep expensive stuff safe.
Similarly, Prince Philip, Duke of Edinburgh, liked to drive himself. He could have people drive him easily. And I must imagine, he probably liked the experience of test driving new cars and picking one that he liked. Even though his assistants probably knew exactly what his preferences in cars were and could have predicted accurately which one he'd end up choosing.
There was a good "scales of wealth" post I read some time ago, it wasn't so much about hard figures but about what financial decisions you need to think about before doing; it starts with the basics like groceries, if you don't need to think about what to buy, what brands, or what your weekly budget is for groceries, you're up one level.
That scale went up from that, to vacations, to cars or houses, then up to really expensive things like private yachts and airplanes.
It's all relative to income; for whoever they were, a 10K purchase might represent about as much as their monthly income as a six pack of beer would be for me.
And their wealth was probably still only a fraction of what the super rich have.
I would the bottom that it was an impulse purchase. Luggage - of amount - isn't really something you buy without thought. It is likely the family had been considering various styles and price points for a while, and just now decided to pull the trigger.
Not defending the prices but it seems to be the same as with paintings. It's just some water color on a piece of paper isn't it? The materials certainly won't make the price of famous artworks.
Not just that they can afford it, but that they have been 'allowed' to buy one. You cannot just walk into a Hermes store and buy a birkenbag, you have to convince them you are 'worthy' even just to be added to the waiting list to maybe be allowed to buy one eventually.
This is why second hands brikenbags go for so much. Because it's the only way to get one without having to go through the whole approval and wait list process.
I think you are paying for the store front, the personal shopping experience, the models showing off the goods on runways far away. Advertisement and branding.
There are plenty of costs involved in luxury goods, not all of them goes towards material.
I thought of this as an economics experiment. What does hobo washing cost? Basically taking a guy covered in filth, and do all the steps needed to get him the finest clothes in the country, at the most exclusive...no that's always a rip off, some reasonable version of that that isn't extortionate. So how many times do you have to buy an intermediate change clothes that lets you shop at the next place?
There was a scene in Pretty Woman about this, Julia Roberts is unable to buy clothes at the nice place because she shows up dressed like a prostitute, so they have to work around that.
Per the article her household has an income of meager 3 million/year so it goes a long way to preserve family budget. But she has a rich friend who buys those too.
Hilarious! To me this illustrates when household wealth gets over a certain level most purchasing decisions become wasteful. Spending millions on NFTs come to mind. Could you imagine how many people could be helped for a fraction of that?
> But if you’re working hard for your money, you don’t want to spend it on stupid stuff.
And so, the reasoning goes, you want to spend it on less stupid stuff, such as fakes, because, for the same amount of money, you can own 10x more fakes than the real thing.
But why do you need 10 fake Birkins?
There is something profoundly sad about people who spend time buying stuff; it's even sadder when they argue that they're being clever because they buy cheap stuff, so they can buy more of it. They are, in effect, hoarders.
I think you may be assuming that I am arguing against people buying handbags. I am not.
If it’s your money, spend it as you wish.
Morally speaking society should only make sure that you didn’t earn money through harmful activities (e.g mafia dons), but it shouldn’t regulate regular spending on luxury goods.
I agree that society shouldn't regulate what people spend their money on, but I'd argue it ought to limit the amount of money that any one individual can accrue.
Of course some will try to do this (not everyone). The aim is to limit their ability to do so. And one doesn't have to succeed entirely for it to be worth the effort.
I guess the goal is to own things. It probably has overlaps with sneakerheads or other streetwear fans. There's another one where being seen wearing the same thing twice is a faux pas - you know the gossip magazines (and people into those) would be all over that.
I think there is another element involved - there is the desire not to ripped off. Many luxury goods are aesthetically pleasing, but total rip offs. Take the ridiculous fad of designer shower sandals/slides, an adidas one costs $25-$35 [1] a Gucci one ~$400 [2] but both probably cost about $5. The point I’m making is if you want Gucci slides (for whatever reasons), and you’re galled by the markup, replicas would seem to “solve” your problem (putting aside all other problems it creates).
The thing I don't understand about luxury goods is why people outsource their taste to these massive corporations like LVMH for so much money.
For the price of an off the rack Armani or Prada suit you can have one custom tailored from a really good tailor. For the price of a LV purse, you can have five or more from a solid local artisan. Higher quality (or exactly the same because this is where these large manufacturers often order stuff), full customization, an actual professional to advise you but people choose a soulless megacorp logo instead.
The status conferred through clothing is not determined by anything so objective as fit or so friendly as self-expression. It is determined entirely by the people who see you. If your peers/coworkers/friends happen to think Armani is cooler, anything else would be an eccentricity. (This is why anyone with sense eventually converges on casual clothing.)
I think that’s the difference between fashionable and stylish. There are a lot of fashionable people, and it’s relatively easy to become one. You need to have some aesthetic sense, but 90% of that can be outsourced if you have the money. You simply buy entire outfits from high fashion companies, and make sure they fit you well enough to look good. Do that often enough that your clothes are always up to date, and you’re fashionable.
Stylish, though, is much harder to attain. A truly stylish person can look incredible in clothes they bought at the Goodwill, because they have an aesthetic sense potent enough to create visually pleasing combinations that are actually novel. A good example of someone like this is Tavi Gevinson. If you’re not familiar, she started a fashion blog called The Fashion Rookie at age 11, and she caught the attention of the fashion world by styling inexpensive clothing in novel and interesting ways.
The signalling works differently depending on who you are.
In my case, if someone has a LV (or similar) bag/purse etc. I have no interest in interacting with them.
Interestingly, this 'signal' applies whether the bag is real or a cheap knockoff - I don't need to check whether the item is genuine, I assume I want to avoid interaction in both cases.
This is what the subreddit mentioned in the article sort of "discovered"; they spend a lot of time obsessing over the details and subtle variations they can get by working directly with factories and artisans in China. By using a real design as a template they cut out the difficult part of designing the whole concept from scratch and can work from a template but still achieve quality with some minor tailoring.
I'm probably dating myself by saying that I used to work at Barney's New York when there was only a Barney's New York (the Womens's Store was still being built).
The first stop the salesmen (they were all male) took the customers to after picking out their suits was to the tailor (Attila on my floor) to get them altered for a perfect fit, which was included in the price.
Of course I get your point about cost effectiveness, but the average person dropping a few k on a single item of clothing really doesn't care about that.
I am just utterly baffled by it all, let’s just say i have a family member who is an out and out snob and very vocal to me about my choice of clothing. This person also considers themselves a fantastic money saver.
I myself, am of an unusual size, just slightly too tall and skinny for off the peg designer stuff in most shops, none of it fits me properly and looks terrible. But i do know shops with off brand stuff that actually fits.
So whenever i buy stuff i like and feel comfortable in, i’m “wasting my money”, but is happy when i pay three times the price for something that doesn’t fit me, is uncomfortable, and can’t actually clean without taking to a dry cleaner so i end up wearing once they seem happy. It drives me up the wall.
I do buy brands i like, eg, converse shoes are oversized compared to all other shoes so i can pick up the largest size in most shops and they fit me, but they aren’t the “right” brand and therefore “a waste of money”. I once spent an entire day trying to find some dress shoes that fit, they cost a fortune, are, tbh, dangerous to wear in real world conditions, and i’ve worn them three times, this, apparently is a good investment. I can’t bloody resell them, wtf?
Not sure what to say besides clothing isn't an investment, but a depreciating asset. Maybe if you're a very public person a good wardrobe would be a business expense.
As long as you are buying reasonable quality and comfortable, I don't think an adult has to explain their choices. ;-)
I like that you're comparing Birkins to angle grinders.
But do you scrape the stickers and replace them with ones that say "Milwaukee", just to pretend you can afford the expensive brand? Because that's what we're talking about here.
I feel like there's a pretty hard line between professional purchases and all other. The calculus of "spending" totally changes when it can directly impact "earning".
I've watched a few of these and the upshot is that there's definitely a quality difference between HF and name brands. I've burnt out a HF angle grinder (which they replaced under warranty). For the most part, HF tools work fine for hobby use and sure they're cheap. But when this angle grinder dies again I'll buy a name brand one (for probably $50) - it gets a lot of use and driving to HF is annoying.
If you're not sure how often you might use something: Buy the budget Harbor Freight equivalent tools, if you use it enough to wear it out/burn it up, upgrade to a better brand. If you never push it so hard it dies, you're perfectly fine with the HF version.
The HF subreddit also has good discussions on the quality of various tools. I'm kind of dissapointed that the HF quality and price has been going up over the years. A lot of people are only going to need that random tool a couple times a year, or maybe only for this one project. HF was perfect for that. Now they're trying to be a slightly cheaper Milwaukee/HomeDepot. Might as well spend a little more and get something that you know is going to last, in many cases. I'm mostly referring to their power tool line. RIP Chicago Electric.
Quantity is usually more expensive than quality in the long run, though. This idea has been succinctly popularized by the "boots theory of socioeconomic unfairness":
>The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money. Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about ten dollars. Those were the kind of boots Vimes always bought, and wore until the soles were so thin that he could tell where he was in Ankh-Morpork on a foggy night by the feel of the cobbles. But the thing was that good boots lasted for years and years. A man who could afford fifty dollars had a pair of boots that'd still be keeping his feet dry in ten years' time, while a poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet.
That's BS and everyone who's not trying to justify a bunch of money they sunk into "premium" products knows it.
There is some relationship between price and quality (and I find this to be most true with things that are short term consumables vs longer term ones like clothing, home goods, etc). Namely you never get more than you pay for. But even assuming you're not getting less than you pay for (which happens a lot) the relationship is still rarely close enough to linear to work out in favor of anything but the cheapest goods or the cheapest goods that meet some specific criteria or feature that yields longer life.
Rich people's stuff lasts longer in large part because they can afford to over-provision and objects that are getting used at a fraction of "what they're good for" whereas poor people are buying the bare minimum and using it at 10/10ths right out of the gate.
Think about where a clipboard warrior on a construction site goes and what they do. Of course their clothing lasts longer than the general laborer who's climbing/crawling all sorts of places over all sorts of things and moving all sorts of material. They could buy the crappiest boots money can buy and still have them outlast anything the laborer wears.
The wealthy person buys a premium mixer that's more than up to the task of mixing what they want to mix. The poor person mixes bread dough with their Amazon-China special and hopes it's good enough.
The wealthy person pays for delivery or rents a truck. The poor person paid for the bump stops he's gonna use the bump stops.
And by wealthy here I mean HN white collar class people vs mid range blue collar type stuff.
I really hate that quote. For one, it is frequently hard to tell when you are actually getting quality by spending more. Sometimes you might just be paying for the label. For another, nice things often require expensive maintenance. Boots you will keep must be resoled periodically. Or you might not need or want to wear the same boots for years and years.
It's not at all uncommon for the cheap thing to be much cheaper in total cost of ownership (TCO) than the "quality" item. Take a look at Edmunds TCO numbers for cars, for example. And back to Harbor Freight: I've heard of shops switching to Harbor Freight air tools because they're 1/10 the cost of the good stuff and last, I forget, something like 1/4 as long.
Price is a necessary but not sufficient requirement for quality, but that's no reason to throw out the idea. Harbor Freight is also not a bottom-barrel brand these days.
Cars are actually a great example. $30k will set you up with a Camry hybrid for >20 years. If you can only afford to finance a $15k econobox, you'll end up paying extra on interest, maintenance, and fuel while your car spends more time in the shop.
IMO this theory gets unfairly maligned by a strawman of "price == quality".
Cars are a great example when you compare just about any used car to being able to finance a new $15K econobox - the econobox will win on TCO. (And at low interest rates, you are better off holding on to your cash and financing). But not when comparing new cars. A $16K Chevrolet Spark LS has a five-year TCO of $26460. Your Camry Hybrid LE (at least twice as much as a Spark in cash outlay) has a five-year TCO of $31903. The Corolla L, which is a sort of benchmark of frugality, has a five-year TCO of $28814.
That was true more often in the old days, but I feel like by ~2000 top brands realized they can just mark up everything 1000%. Linked to rise of the 1% it seems.
I also buy no-name ~$250 bikes online (now more) because I live in a high theft area and don't enjoy maintenance either. So I get a new one every year or two when they get stolen, or broken then recycle the old one. Extra parts are in good supply as well.
My takeaway was that the community for fakes had wound up being stronger than the community for authentics, where the authentics are just an isolation from society while the fakes are comraderie and international currency
More importantly, it's a symbol of conspicuous consumption: prices start at US$11,000. They're also famously impossible to procure unless you have connections, you can't just march into the nearest Hermes and buy one.
Ah, the classic stupid rich folks management that european brands mastered long ago, ie Ferrari.
FYI you can't buy V12 Ferrari outright, even if you want to pay 10x the official price. They will sell you some basic V8 model, and if you are happy and good customer, after few years, they can put you in the waiting list for something better.
Theoretically you can skip the line by buying from somebody else, but as an owner you sign very detailed contract what you can and can't do (ie repaint), if you screw this one up you are banned from Ferrari forever (I think Justin Bieber ended up like that but don't know details).
These days, it may not be V8 but V6, and V12 became some crazy hybrid with literally too much power to drive for normal people but the logic remains, and there is more clueless rich folks who want to impress.
The “connection” is usually just with a sales associate (retail employee in store) who feels like offering to sell you one at any random Hermes store, which isn’t a particularly “impossible” connection to acquire. There’s a lot of things that can be done to increase the chances as well including but not limited to:
- send in your husband/boyfriend
- buy a lot of Hermes products from the same SA
- claim it’s your birthday or that you’re expecting (harder to pull of nowadays since it’s done often)
- visit a store in France
The difficult part is being able to get it in the size/color/hardware you want since they don’t necessarily have what you want in stock or have for whatever reason decided to not show it to you as an option.
This is a stereotype, and, like most, it is wildly untrue.
I never wore an expensive watch (or any watch) until I became interested in jewelry and accessories. My phone tells the time just fine (better even), but my IWC is fucking gorgeous on my wrist.
There's nothing wrong in wearing beautiful jewelry, and a person choosing to do so does not tell you anything else about that person. It's sad to see this sort of attitude promoted.
My impression after reading the article is that this is some sort of virtue signalling. "for many women in circles where social currency can be purchased, rep-buying has evolved into a kind of edgy declaration of identity"
I'd summarize it as: Look at how smart I am, I can get all the benefits of fashion for a fraction of the money while sticking it to "the man" and big corporations.
Most people agree that overpriced fashion stuff is bad => You gain virtue points by hating them.
Most people are still affected/impressed by fashion => You gain virtue points by owning it.
Most people agree that getting more for less shows that you are smart => You gain virtue points by buying fakes.
And apparently, the risk involved is also attractive to bored people. "have shared terrifying disciplinary letters sent directly from fashion houses. They typically contain grand threats — prison terms, multimillion-dollar fines — and are intended to shock and awe the recipients"
I've now seen this story reported is so many places. My wife says she's also seen it on her social media. So either the entire world suddenly cares about knock off handbags or someone is spending a lot on PR.
Is Hermes behind this? Its a clever idea. You know your brand is going to be copied so you might as well be the one doing it.
I dunno, in Europe at least they are cracking down hard on "fake" products, mainly because the big brands see it as competition. Being caught with imitation products at e.g. customs in airports will get your imitations confiscated and you fined.
> One posits that the fashion houses own the rep factories so they can monetize at every level
This is a side plot in "House of Gucci". After Lady Gaga shuts down the street sales of knock-offs, Gucci loses a large portion of their income and it contributes to their financial woes.
I first started looking at RepLadies a year or so ago when I was looking at buying a bag for my wife (I would tell her it was a rep of course).
I never bought anything, but I do occasionally still check in on the subreddit. There is something about the way it is run, as if by a mixture of Reese Witherspoon from Legally Blonde and Kristin Davis from Sex in the City that makes it quite a fun read.
Recently I started buying replica sunglasses. Work just like the real thing and a fraction of the price. Worth it especially for sunglasses that I have to replace every year. I'm thinking of trying to pick up some other accessories like belts next.
One other interesting thing about reps is it feels like they provide the most utility to those who can afford but don't want to pay the full price. If you are a kid decked out in full designer gear, people will call you out. But if you mix and match with some real pieces, people will just assume they are all real.
In fact Africans who were doing the selling during the Slave Trade generally insisted on the Asian fineries and dismissed the European products as distantly and vertically inferior. And they were generally pretty shrewd in the negotiation, they knew the immense worth of whom they were selling. Insisted on getting beautiful clothes out of the equation.
And Pablo Neruda says, at one point, "Chinese hands and Mexicans hands are similar, incapable of making ugly things."
There's a great description of why people buy these things by DeMesquita and Smith in their dictator's handbook, where instead of just conspicuous consumption, the status signal is more for political survival. The idea is that if you have a position, there are people who keep you there because you return rewards to them, and when you stop, they will find a way to replace you. Spending (arguably, sacrificing) money on status symbols indicates your ability to continue to deliver those rewards to your essential coalition.
If you can sacrifice $100k on a handbag or a watch, you're probably doing well, but if you're still wearing it 18-24mos later, are you still doing as well? As an essential coalition member how can I trust you're still going to be able to deliver what I need so that I keep you there?
If I am a prince, I can't tell you that I just made a deal with the americans for several billion in oil or give away details of what I do for the money I pay you because that's not strategic, but I can drop $50m on a new plane or make a splash at an art auction to demonstrate I'm still a going concern and your interests are secured. This isn't just ego, it is survival.
It works at a small scale as well, where if you are a local gangster, you splash out on jewelry, bottle service, and car rims. If you're an i-banker, you keep up with the joneses with places in the hamptons, or if you have a family office, palm beach. Where it gets weird is in US politics, you don't spend money to signal, instead, you do illegal things with impunity to demonstrate power. It's cheaper, but also more dangerous. If you are in media, publicly lying to sustain narrative is a similar signal, which is why mainstream media personalities can seem so dim, but they're playing the same game. (Alternative media people haven't figured out there's a game at all.)
In that theory, whether it's a birkin bag or bullshit, the status isn't the end itself, it's the political survival that the status enables that drives it. These fake bags are for people pretending to play a game they don't understand.
Throughout the day i have misread “Birkins” as “Birkinis” and have been simultaneously confused by the trend and also disinterested in actually reading the articles.
It is amazing how Reddit has replaced the words "counterfeit/knock offs/fakes" with "rep". Some examples: /r/repladies, /r/repsneakers, /r/reptime, /r/luxuryreps, etc etc etc
At least the OG /r/fakeid guys had no pretense about what they were about.
> “But if you’re working hard for your money, you don’t want to spend it on stupid stuff. In New York especially, wealthy people just have more interesting things to do with their money. They invest in crypto. They reinvest in their businesses. They invest in their children.”
This just looks like vapid people being vapid and chasing this moment's fad.
So I have an acquaintance who is a sneaker head, and they spend wayyyy too much money on shoes. For most sneaker heads, the Nike Air Jordan 1 is the ultimate pair to acquire. Old ones, new releases, they all sell for exorbitant amounts, and the games necessary to acquire them are legion. Or you can just go on StockX and pay the going rate.
So the other day he sends me a pic of a pair of AJ1s that are the "banned" originals that the NBA told Jordan not to wear. They were in mint shape, and that's unusual in kicks because the glue binding the soles to the leather usually breaks down. Any foam padding usually breaks down too, so a pair from 1985 would look like crap. Yet these looked perfect.
Now Nike re-releases AJ1s all the time. But they're not the same as the original, for a variety of reasons I won't get into. And people want the original style, or as close as possible to it.
Turns out there's quite a few people crafting "new" AJ1s that look identical to the 1985 AJ1s. You can even buy them with authentic soles. These shoes are handcrafted with really well dyed leather, the correct stitching etc. They get the soles from buying beater kicks on eBay etc, or you can even send in your old shoes to have the soles re-used.
I owned an original pair of AJ1s (not the banned version) from 1985, and there was only one detail that was overlooked. My friend didn't care, but it annoyed me that they had missed the detail. And then he told me how much the hand-crafted versions were selling for.... $800. This was back in the first part of the year, and now the prices are like $1250.
The same companies will create bespoke editions for you, typically starting at $5K a pair.
133 comments
[ 4.6 ms ] story [ 224 ms ] threadWhat do the costs for “real” luxury bags even go to? Some of them apparently cost hundreds of thousands of dollars. It’s enough for two artisan workers to collaborate on making a single bag a year, then rest in a comfortable lodge in the Swiss alps until they make a single bag next year.
I can understand luxury car prices, to an extent. There’s engineering and material prices that surely can’t be cheap. I can’t understand a piece of cow hide going for the same price.
They've clearly found the sweet spot in the overall profitability curve, somewhere in the six-figure range.
Speculation: Then, in the end, this explains maybe 1/3 of the pricing, the next 1/3 is marketing (prime real estate in metropolises, extensive sponsoring, one store employee per customer, a doormen, ...) and finally some nice profit margin, looking at you LMVH.
From what I gather the factories in China that make the real thing will also make extra copies of the real thing, thus making it extremely hard to tell the difference.
The social element is maybe the most interesting, it's like a hobby for these ladies. What I've noticed through my life is there's always people who do some kind of cottage buying-and-selling on the side: friends who buy luxury watches, collectible cards, used cars, restoring old laptops. There's something universal about that instinct. Being socialites it makes sense they gather about this particular thing.
The Hermes bags are made in France, by leather artisans.
And yet ironically in the article,
> She echoed a number of women I spoke with who think authentic customers are the ones getting played. “These days, the reps just tend to be better made,” a Hamptons-based chief strategy officer tells me. “They last longer. There’s more attention to detail. You can tell that things have been done by hand.”
You sure the women in the article don't think the same way about the bags? The price difference between a working Android phone and top of the line iPhone is around 10x as well.
It used to be a big status symbol, but they've become more mainstream now. People will still look down on people using Android phones though.
related: Beats headphones are / were a status symbol, as are airpods. The kids want airpods. People want to be seen wearing airpods. People want to be seen.
Two centuries ago Britain was already well through its Industrial Revolution. Its mass production went hand in hand with mass consumption.
What you describe was probably closer to true for eg Russia.
Huh? Global wealth inequality has dropped dramatically in the last few decades.
What's important for luxury sales is not the gap between rich and poor, but that the rich are richer.
Also keep in mind that because so much of the wealth of the very rich is tied up in assets like shares, the wealth share of the very rich takes a (comparative) nose dive whenever the economy enters a recession. Their wealth and income drops dramatically more than that of your rank and file employee, or that of someone on government handouts.
Absolutely, the rich are still rich and the poor are still poor in a recession. but on paper the gap between, say, average and top 0.1% narrows.
And, obviously, recessions are bad for both poor and average people. But you wouldn't get that from looking at inequality.
Just another reason to focus on absolute numbers, instead of whether the Joneses have more.
Btw, why do you want to focus on where the gross money is, instead of what you can buy after taxes with your money? People don't eat money, usually.
But every summer (apart from recent covid ones), whole planes come from Arabian gulf. Planes full of ferraris and lambos, so you suddenly see (and hear) a lot of arab plated cars in central europe. These people shop as you describe - come to ie Versace or Piguet shop because its just by the lake, spend ridiculous amount and go to next shop.
Basically these few weeks enable those shops to survive for rest of the year since rentals are crazy.
Probably not to just anything, because you have to remain high status. But perhaps host some fancy artists or so.
Essentially, if you have actual FU money, you're not spending time going to a shop to choose your own luggage. You probably don't even see your luggage. An assistant packs your stuff, a driver puts it on your plane, and a hotel worker unpacks it at the other end. Your luggage is probably some completely boring, utilitarian metal box designed to keep expensive stuff safe.
Some people _like_ shopping.
Similarly, Prince Philip, Duke of Edinburgh, liked to drive himself. He could have people drive him easily. And I must imagine, he probably liked the experience of test driving new cars and picking one that he liked. Even though his assistants probably knew exactly what his preferences in cars were and could have predicted accurately which one he'd end up choosing.
That scale went up from that, to vacations, to cars or houses, then up to really expensive things like private yachts and airplanes.
It's all relative to income; for whoever they were, a 10K purchase might represent about as much as their monthly income as a six pack of beer would be for me.
And their wealth was probably still only a fraction of what the super rich have.
This is why second hands brikenbags go for so much. Because it's the only way to get one without having to go through the whole approval and wait list process.
There are plenty of costs involved in luxury goods, not all of them goes towards material.
I'm not sure investing in glorified ponzi schemes qualifies as doing more interesting things in with their money.
Some of the comments really read as a satire
> “Imagine we were just spending all of our money on authentic handbags,” she says. “You would never grow your wealth that way, right?
And then a bit above, one of the person interviewed spent 10,000 a year on replicas.
There was a scene in Pretty Woman about this, Julia Roberts is unable to buy clothes at the nice place because she shows up dressed like a prostitute, so they have to work around that.
I'd say it's interesting. Though perhaps not wise.
Hilarious! To me this illustrates when household wealth gets over a certain level most purchasing decisions become wasteful. Spending millions on NFTs come to mind. Could you imagine how many people could be helped for a fraction of that?
And so, the reasoning goes, you want to spend it on less stupid stuff, such as fakes, because, for the same amount of money, you can own 10x more fakes than the real thing.
But why do you need 10 fake Birkins?
There is something profoundly sad about people who spend time buying stuff; it's even sadder when they argue that they're being clever because they buy cheap stuff, so they can buy more of it. They are, in effect, hoarders.
It's their time and money.
Second, you're assuming people whose income isn't from employment aren't subject to taxes.
Third, you're assuming consumption is not contributing to society.
Fourth, how do you propose wealthy people redistribute to the masses ?
Five, you're assuming wealth is unproductive. Should wealthy people just hoard their wealth in cash and gold instead of income generating assets?
You seem to be arguing against something the GP didnt actually say.
Different colours?
Or other things. Unless I missed the memo where they are paid in fake Birkin scrip that can only be exchanged for other fake Birkins.
[1]https://www.adidas.com/us/adilette-comfort-slides/GZ5892.htm...
[2]https://www.gucci.com/us/en/pr/men/shoes-for-men/slides-sand...
For the price of an off the rack Armani or Prada suit you can have one custom tailored from a really good tailor. For the price of a LV purse, you can have five or more from a solid local artisan. Higher quality (or exactly the same because this is where these large manufacturers often order stuff), full customization, an actual professional to advise you but people choose a soulless megacorp logo instead.
Stylish, though, is much harder to attain. A truly stylish person can look incredible in clothes they bought at the Goodwill, because they have an aesthetic sense potent enough to create visually pleasing combinations that are actually novel. A good example of someone like this is Tavi Gevinson. If you’re not familiar, she started a fashion blog called The Fashion Rookie at age 11, and she caught the attention of the fashion world by styling inexpensive clothing in novel and interesting ways.
In my case, if someone has a LV (or similar) bag/purse etc. I have no interest in interacting with them.
Interestingly, this 'signal' applies whether the bag is real or a cheap knockoff - I don't need to check whether the item is genuine, I assume I want to avoid interaction in both cases.
I'm probably dating myself by saying that I used to work at Barney's New York when there was only a Barney's New York (the Womens's Store was still being built).
The first stop the salesmen (they were all male) took the customers to after picking out their suits was to the tailor (Attila on my floor) to get them altered for a perfect fit, which was included in the price.
Of course I get your point about cost effectiveness, but the average person dropping a few k on a single item of clothing really doesn't care about that.
I myself, am of an unusual size, just slightly too tall and skinny for off the peg designer stuff in most shops, none of it fits me properly and looks terrible. But i do know shops with off brand stuff that actually fits.
So whenever i buy stuff i like and feel comfortable in, i’m “wasting my money”, but is happy when i pay three times the price for something that doesn’t fit me, is uncomfortable, and can’t actually clean without taking to a dry cleaner so i end up wearing once they seem happy. It drives me up the wall.
I do buy brands i like, eg, converse shoes are oversized compared to all other shoes so i can pick up the largest size in most shops and they fit me, but they aren’t the “right” brand and therefore “a waste of money”. I once spent an entire day trying to find some dress shoes that fit, they cost a fortune, are, tbh, dangerous to wear in real world conditions, and i’ve worn them three times, this, apparently is a good investment. I can’t bloody resell them, wtf?
As long as you are buying reasonable quality and comfortable, I don't think an adult has to explain their choices. ;-)
You know who never has to swap between wheels because he always has a grinder that already has what he wants on it?
This guy.
Ditto for basic socket sets placed at typical work areas, tape measures all over the fuckin place, etc, etc.
Quantity has a quality all its own.
But do you scrape the stickers and replace them with ones that say "Milwaukee", just to pretend you can afford the expensive brand? Because that's what we're talking about here.
https://www.youtube.com/watch?v=7cSiI9MB9MA
I've watched a few of these and the upshot is that there's definitely a quality difference between HF and name brands. I've burnt out a HF angle grinder (which they replaced under warranty). For the most part, HF tools work fine for hobby use and sure they're cheap. But when this angle grinder dies again I'll buy a name brand one (for probably $50) - it gets a lot of use and driving to HF is annoying.
If you're not sure how often you might use something: Buy the budget Harbor Freight equivalent tools, if you use it enough to wear it out/burn it up, upgrade to a better brand. If you never push it so hard it dies, you're perfectly fine with the HF version.
>The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money. Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about ten dollars. Those were the kind of boots Vimes always bought, and wore until the soles were so thin that he could tell where he was in Ankh-Morpork on a foggy night by the feel of the cobbles. But the thing was that good boots lasted for years and years. A man who could afford fifty dollars had a pair of boots that'd still be keeping his feet dry in ten years' time, while a poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet.
https://en.wikipedia.org/wiki/Boots_theory
There is some relationship between price and quality (and I find this to be most true with things that are short term consumables vs longer term ones like clothing, home goods, etc). Namely you never get more than you pay for. But even assuming you're not getting less than you pay for (which happens a lot) the relationship is still rarely close enough to linear to work out in favor of anything but the cheapest goods or the cheapest goods that meet some specific criteria or feature that yields longer life.
Rich people's stuff lasts longer in large part because they can afford to over-provision and objects that are getting used at a fraction of "what they're good for" whereas poor people are buying the bare minimum and using it at 10/10ths right out of the gate.
Think about where a clipboard warrior on a construction site goes and what they do. Of course their clothing lasts longer than the general laborer who's climbing/crawling all sorts of places over all sorts of things and moving all sorts of material. They could buy the crappiest boots money can buy and still have them outlast anything the laborer wears.
The wealthy person buys a premium mixer that's more than up to the task of mixing what they want to mix. The poor person mixes bread dough with their Amazon-China special and hopes it's good enough.
The wealthy person pays for delivery or rents a truck. The poor person paid for the bump stops he's gonna use the bump stops.
And by wealthy here I mean HN white collar class people vs mid range blue collar type stuff.
It's not at all uncommon for the cheap thing to be much cheaper in total cost of ownership (TCO) than the "quality" item. Take a look at Edmunds TCO numbers for cars, for example. And back to Harbor Freight: I've heard of shops switching to Harbor Freight air tools because they're 1/10 the cost of the good stuff and last, I forget, something like 1/4 as long.
Cars are actually a great example. $30k will set you up with a Camry hybrid for >20 years. If you can only afford to finance a $15k econobox, you'll end up paying extra on interest, maintenance, and fuel while your car spends more time in the shop.
IMO this theory gets unfairly maligned by a strawman of "price == quality".
It's still possible to be too cheap however.
The Wikipedia also has pictures.
FYI you can't buy V12 Ferrari outright, even if you want to pay 10x the official price. They will sell you some basic V8 model, and if you are happy and good customer, after few years, they can put you in the waiting list for something better.
Theoretically you can skip the line by buying from somebody else, but as an owner you sign very detailed contract what you can and can't do (ie repaint), if you screw this one up you are banned from Ferrari forever (I think Justin Bieber ended up like that but don't know details).
These days, it may not be V8 but V6, and V12 became some crazy hybrid with literally too much power to drive for normal people but the logic remains, and there is more clueless rich folks who want to impress.
If you want to look it up yourself, just search for "deadmaus ferrari".
[0] https://ideal.media/why-ferrari-sued-deadmau5/
- send in your husband/boyfriend
- buy a lot of Hermes products from the same SA
- claim it’s your birthday or that you’re expecting (harder to pull of nowadays since it’s done often)
- visit a store in France
The difficult part is being able to get it in the size/color/hardware you want since they don’t necessarily have what you want in stock or have for whatever reason decided to not show it to you as an option.
I never wore an expensive watch (or any watch) until I became interested in jewelry and accessories. My phone tells the time just fine (better even), but my IWC is fucking gorgeous on my wrist.
There's nothing wrong in wearing beautiful jewelry, and a person choosing to do so does not tell you anything else about that person. It's sad to see this sort of attitude promoted.
I'd summarize it as: Look at how smart I am, I can get all the benefits of fashion for a fraction of the money while sticking it to "the man" and big corporations.
Most people agree that overpriced fashion stuff is bad => You gain virtue points by hating them.
Most people are still affected/impressed by fashion => You gain virtue points by owning it.
Most people agree that getting more for less shows that you are smart => You gain virtue points by buying fakes.
And apparently, the risk involved is also attractive to bored people. "have shared terrifying disciplinary letters sent directly from fashion houses. They typically contain grand threats — prison terms, multimillion-dollar fines — and are intended to shock and awe the recipients"
I think you meant to comment on https://news.ycombinator.com/item?id=31336498 .
Hmm, but https://coinmarketcap.com/currencies/terrausd/ says the low was $0.2998 . How does that make sense with what you saw?
Is Hermes behind this? Its a clever idea. You know your brand is going to be copied so you might as well be the one doing it.
This is a side plot in "House of Gucci". After Lady Gaga shuts down the street sales of knock-offs, Gucci loses a large portion of their income and it contributes to their financial woes.
I never bought anything, but I do occasionally still check in on the subreddit. There is something about the way it is run, as if by a mixture of Reese Witherspoon from Legally Blonde and Kristin Davis from Sex in the City that makes it quite a fun read.
One other interesting thing about reps is it feels like they provide the most utility to those who can afford but don't want to pay the full price. If you are a kid decked out in full designer gear, people will call you out. But if you mix and match with some real pieces, people will just assume they are all real.
And as this article touched on theres also the thrill of getting a bargain which shouldn't be underestimated.
In fact Africans who were doing the selling during the Slave Trade generally insisted on the Asian fineries and dismissed the European products as distantly and vertically inferior. And they were generally pretty shrewd in the negotiation, they knew the immense worth of whom they were selling. Insisted on getting beautiful clothes out of the equation.
And Pablo Neruda says, at one point, "Chinese hands and Mexicans hands are similar, incapable of making ugly things."
If you can sacrifice $100k on a handbag or a watch, you're probably doing well, but if you're still wearing it 18-24mos later, are you still doing as well? As an essential coalition member how can I trust you're still going to be able to deliver what I need so that I keep you there?
If I am a prince, I can't tell you that I just made a deal with the americans for several billion in oil or give away details of what I do for the money I pay you because that's not strategic, but I can drop $50m on a new plane or make a splash at an art auction to demonstrate I'm still a going concern and your interests are secured. This isn't just ego, it is survival.
It works at a small scale as well, where if you are a local gangster, you splash out on jewelry, bottle service, and car rims. If you're an i-banker, you keep up with the joneses with places in the hamptons, or if you have a family office, palm beach. Where it gets weird is in US politics, you don't spend money to signal, instead, you do illegal things with impunity to demonstrate power. It's cheaper, but also more dangerous. If you are in media, publicly lying to sustain narrative is a similar signal, which is why mainstream media personalities can seem so dim, but they're playing the same game. (Alternative media people haven't figured out there's a game at all.)
In that theory, whether it's a birkin bag or bullshit, the status isn't the end itself, it's the political survival that the status enables that drives it. These fake bags are for people pretending to play a game they don't understand.
These fake bags are for people who play the game but can't afford to play with real bags.
At least the OG /r/fakeid guys had no pretense about what they were about.
This just looks like vapid people being vapid and chasing this moment's fad.
So the other day he sends me a pic of a pair of AJ1s that are the "banned" originals that the NBA told Jordan not to wear. They were in mint shape, and that's unusual in kicks because the glue binding the soles to the leather usually breaks down. Any foam padding usually breaks down too, so a pair from 1985 would look like crap. Yet these looked perfect.
Now Nike re-releases AJ1s all the time. But they're not the same as the original, for a variety of reasons I won't get into. And people want the original style, or as close as possible to it.
Turns out there's quite a few people crafting "new" AJ1s that look identical to the 1985 AJ1s. You can even buy them with authentic soles. These shoes are handcrafted with really well dyed leather, the correct stitching etc. They get the soles from buying beater kicks on eBay etc, or you can even send in your old shoes to have the soles re-used.
I owned an original pair of AJ1s (not the banned version) from 1985, and there was only one detail that was overlooked. My friend didn't care, but it annoyed me that they had missed the detail. And then he told me how much the hand-crafted versions were selling for.... $800. This was back in the first part of the year, and now the prices are like $1250.
The same companies will create bespoke editions for you, typically starting at $5K a pair.