You don't use much gold in a high end watch as it's heavy and not all that strong. Nobody wants to walk around with a 3 pound watch, and huge diamonds on watches look stupid. So it's all about restricted supply. This watch costs 200k because we are going to make 100 of them.

One of the hidden truths about high end watches is they don't keep vary good time. And they don't have high resale value most of the time.

Don't forget how much it costs to sell the watch - that highly trained staff at the Beverly Hills boutique doesn't come cheap either. This of a luxury version of a car dealership.

Resale value of luxury items seems very odd to me. If the original purpose of buying it was that it was intentionally luxurious and decadent, where is the market for buying it second hand?

Obviously other people won't know you bought it used, but it seems like the notions of luxury and resale are inherently opposed.

There's a trickle down market like everything else. A used-but-not-tatty luxury item is still luxurious, and while it won't impress the already-wealthy it will carry cachet with the upwardly-mobile or the general public. Thus, you might be better off buying a used Rolls-Royce or Bentley than a new Lexus.

I was surprised to learn from Mrs Browl that there are rental clubs for luxury handbags - women who want to make a fashion statement can check out a different designer accessory for different events. This made no sense to me until I considered it from a social engineering standpoint.

High end watches don't keep very good time because they're not electronic watches -- they have mechanical movements.