Chris’ note: It’s one of the most popular pieces of content we publish here at the Dispatch… E.B. Tucker’s “Notes from the Battlefield” – a special feature in which E.B. shares his latest experiences away from the desk.

Because, as E.B. says, “It’s these experiences that do more for long-term success than anything you can accomplish at the office.”

If you haven’t been reading them, you’re missing out. Whether he’s making tequila in Mexico, visiting “tiny homes,” or spending a night in an insane asylum… E.B. always has something interesting to say that makes you think. And there’s usually a lesson involved.

Now, I should point out… these pieces aren’t like anything you’ll read in other letters. But that’s why we continue to publish them.

And today, he shares his latest adventure…


By E.B. Tucker, editor, Strategic Investor

E.B. Tucker

In 2015, I bought this chair for $500 out of a friend’s garage.

While it looks like something you’d put out by the curb on trash day, I knew it was worth much more.

Recently, I went to Framingham, Massachusetts, to see my chair. It’s currently in pieces. I wanted to meet Fran Trainor, the man who’s restoring it to its original condition. He’s one of the leading experts on this specific chair with over 30 years of experience. When he’s done, I’ll have the option of selling the chair for $7,500, maybe more. But I won’t.


Fran Trainor, owner of Studio 670 in Framingham, Massachusetts

You’ve probably seen this chair before. Here’s a picture of what mine will look like when Fran ships it back to me in a few weeks.


Eames Lounge Chair for sale at www.1stdibs.com

It’s called the Eames Lounge Chair. Husband and wife designers Charles and Ray Eames released the high-end chair and ottoman combo in 1956. Office furniture company Herman Miller held the rights to manufacturing and selling the chair. It still does today.

You’ll see these chairs in offices and stylish homes. Many of the chairs you’ll see are fakes. Those that aren’t fake are usually new and lack the original feel Eames so carefully designed.

For instance, in the early days, the chair’s wood backing was Brazilian rosewood. This wood is stunning. The finish is perfect. The Eames duo had perfection in mind when they picked it. Once you sit in an original Eames, you’ll experience perfection in every detail.

Herman Miller stopped using Brazilian rosewood in 1989. It got rid of Scottish leather which Charles Eames saw as essential in the original design. All of these changes put corporate convenience ahead of comfort and style. That means newer Eames chairs are just expensive pieces of furniture. They’re not special.

I was instantly fascinated with this chair when I discovered these facts. When I visited someone’s office and saw the chair, I’d compliment it. That gave me time to stare and look for identifying features to judge the age. If I spotted a fake and the chair owner didn’t admit it, it told me a lot about the person.

Some people come right out and tell you, “It’s a fake.” After all, most of the chair’s patents are out of date. You can get a knockoff on Amazon for as little as $600.

I set out to find an old Eames several years ago. I felt like I knew enough to avoid the fakes and the poseurs. At the repair shop, Fran complimented my purchase. He’s a leading expert in Eames furniture. He estimates my chair is mid-1970s vintage. (I am also ’70s vintage.)

How to Date the Eames

Herman Miller will sell you as many brand-new Eames Lounge Chairs as you want today. They run $5,000-7,000, depending on the finish. To me, they’re just expensive new chairs. I’m interested in something with a story.

I set out to learn how to identify vintage Eames chairs several years ago. I found it wasn’t too difficult once you know what to look for.

The first chairs in 1956 have a label that reads “Los Angeles, CA” in the address. Later models had “Zeeland, MI.” Notice there’s no zip code. The U.S. Postal Service did not start using zip codes until 1963. If someone tries to sell you an original pre-1963 Eames, check to see if there’s a zip code on the label.

The labels changed over time. Here’s the label on the bottom of my chair. The black label and the patents listed are both important features.


The last patent listed on my chair was filed in 1962

When I saw the label on the chair I bought, I knew it was from the 1970s. While the date of the last patent listed was 1962, the black Herman Miller logo with small-cap font showed up in 1970. It later included a registered trademark designation, but you’ll notice in the picture above that my chair doesn’t have that.

In a few weeks, I should receive a perfectly restored Eames Lounge Chair from Fran. I inspected it in pieces recently, and it looks great. By doing a little homework, I managed to create a modest amount of value while enjoying the chair.

There’s a Bubble in Mid-Century Furniture

I’ve made a hobby out of collecting. While I don’t have a lot of stuff, some items catch my attention. Once they do, I tend to learn everything about them. Then I keep a keen eye out for them. It might be years before I stumble onto one. I’m not in a rush.

In the five-year-plus process of finding, restoring, and enjoying my Eames Lounge Chair, I discovered a big bubble in mid-century furniture. Here’s an example.

Recently, Fran showed me a set of five armchairs by Danish designer Hans Wegner. The design of the chair aimed to minimize the back. This way, it looked sleek from all sides.

Some people call this the “Kennedy” chair after seeing it in the September 1960 debate between JFK and Nixon.


Hans Wegner’s “Round Chair” used in a 1960 presidential debate (Photo credit: The Mid-Century Modernist)

This set of five chairs in Fran’s workshop will sell for around $50,000. They could fetch as much as $60,000 if a wealthy buyer gets overexcited.


Set of five Hans Wegner Round Chairs valued from $50,000-60,000

Mid-century furniture caught on over the past few years. Collectors started buying up pieces. It fits with a minimalist trend that’s popular right now. Here’s how the typical process works, according to Fran, who sees most of the premium mid-century pieces coming out of the Boston area.

Say an elderly erudite couple passes away in Cambridge, Massachusetts. Their children contact a local antique buyer and ask them to come help get rid of all their stuff. The antique dealer sees this set of Wegner chairs. He says, “What do you want for these?” The typical response from the uninformed child of a recently deceased collector is, “I don’t know, a couple of hundred bucks each seems fair.” After all, these chairs look old.

The antique dealer jumps on this immediately. On the way back to his shop, he makes a call, selling them for $5,000 each, sight unseen. That buyer sends them to Fran for proper refurbishing. Afterwards, the new owner lists them on a website like 1stdibs.com for $10,000 each, maybe more.

This happens all the time as an older generation of collectors dies. In fairness, most owners bought these pieces because they were cool in the 1950s or 1960s. They likely haven’t kept up with the latest prices of everything in the house.

Thanks to the Federal Reserve’s radical money experiment over the past decade, we’re now in an “everything bubble.” The prices of unique homes, art, classic cars, watches, and even stocks are sky-high.

While the Wegner chairs are very cool, I’m not sure they’re worth $12,000 each. But maybe I’m wrong.

How Big Can an “Everything Bubble” Get?

I’m a picky collector. I’m not looking to fill up a climate-controlled storage unit with so many items I can barely keep up with them. I tend to hunt for years before jumping on a deal when I see it.

In 2017, a friend invited me to a Sotheby’s auction at the company’s Manhattan headquarters. He hired the company to sell a set of art panels recovered from the SS Normandie after it caught fire in the 1940s.

While waiting for my friend’s art to hit the auction block, I noticed this chair. It’s a Mackintosh.


Charles Mackintosh side chair circa 1904 ($576,500)

The Scottish designer died in 1928. 89 years later, I watched this small wooden side chair sell for $576,500.

The bidder phoned in to buy the chair. The man sitting next to me told me some reclusive billionaire loves Mackintosh and wants the entire set of these sitting chairs. I can’t imagine what he’ll do with them.

From the 3-foot-tall Jeff Koons rabbit that sold for $91 million this year to the anonymous buyer who bought the potentially fake Salvator Mundi for $450 million in 2017… we’re in an everything bubble.

I’m not sure how this ends. Maybe the small wooden Mackintosh chair sells for $1 million, or even $2 million. After all, there’s no way to value its exquisite detail, age, and rarity.

What I do know is, one day, assets will be valued based on utility. That means the asset’s value depends on its economic usefulness.

An apartment complex that generates $1 million per year in net rental income has value. A billboard that pays its owner $4,000 per month in advertising rental income has value.

A wooden side chair from the early 1900s has no economic value. Yes, it’s unique, interesting, and fun to learn about. But I’m not sure that’s worth $576,500.

As for when economic value regains its place as the determinant of what things cost, I can’t say. What I do know is, when that happens, you don’t want to have your entire net worth stashed in wooden chairs.

Regards,

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E.B. Tucker
Editor, Strategic Investor