The jpeg market is over

The NYT reports on the crash in the art market.

The manner in which art is purchased will probably become more conventional too. In the flush years it was common for auction houses to sell to people who never actually saw a work live but bought simply based on an e-mailed image or a picture in a catalog. “The jpeg market is over,” Mr. Meyer said. “We’re getting back to selling art you really have to look at.”

Voor de liefde Gods

Damien Hirst's famous "skull" is now on view in Amsterdam. Click here for more information.

Sneak preview

The New York Times has a nice preview of the upcoming fall auctions in New York.

ARTIST: Kasimir Malevich
TITLE: “Suprematist Composition” (1916)
AUCTION HOUSE: Sotheby’s
ESTIMATED PRICE: $60 million
Sotheby's officials predict that this painting will fetch $60 million. Determined to offset some of the risk, Sotheby's has lined up a buyer who has contractually agreed to purchase the painting for an undisclosed sum. If someone else is willing to pay more, the original bidder will get a share of what is called the upside: the difference between what he was willing to pay and the higher price.

I would rather buy the Philip Guston though.

New York, New York

...is where I will spend some time next year.

Writing a paper

Beginning is easy: "This paper investigates the evolution of prices and returns in the art market since the middle of the previous century." Then it gets harder.

"An incredible richness of experiences"

Now on Sotheby's TV: the preview of its Contemporary Art Evening Sale in New York on November 11.

Seeing auctioneer Tobias Meyer talking about the works of Yves Klein and the likes, you start to understand what he said in an interview with The New Yorker in 2006: "What I love to do is put people in front of art and make them feel it, make them stop everything else they're doing and experience it, deeply. That's how I make art expensive. And that's my job, for the company and for my clients. To make art expensive."

Down, down, down (2)

Artinfo reports on the "funereal mood" at the London auctions.

"We obviously need to adjust our pricing," said Christie’s London contemporary head Pilar Ordovas at the post-sale press conference.

Down, down, down

Sotheby's stock price over the last six months:

Printing money

In today's edition of The Guardian, British artists talk about art and money.

"Any artist who doesn't secretly admire what Damien's been able to achieve is not being entirely honest. But that level of commodification is quite specific to Damien." About the individual Hirst works that went on the block, Julien is more circumspect. "Warhol's use of repetition had real intellectual meaning. Nowadays, I wonder if seriality is not just a way of printing money."

My shopping bag

I went to Frieze today. I couldn't afford any of the works up for sale, but I did go home with 'The $12 Million Stuffed Shark'.

When the book was published in February, The Economist's Art.view blog wrote:

A new book by an economist named Don Thompson entitled 'The $12 Million Stuffed Shark: The Curious Economics of Contemporary Art and the Auction Houses' ought to be required reading for collectors intending to wade into well publicised contemporary art auctions like the one Sotheby’s will host on February 27th. It ought to be, but it won’t, because it is out of tune with the hype that accompanies these sales.

Two of Mr Thompson’s observations are particularly telling. First, only half of the modern and contemporary artists listed in Christie’s and Sotheby’s catalogues 25 years ago are now offered at any major auction. And second, of the 1,000 artists who had serious gallery shows in London and New York during the 1980s only 20 were shown in comparative venues in 2007.

The Power 100

ArtReview has published its 2008 Power 100 list.

Now in its seventh year, the Power 100 assesses the titans of the artworld at a time when contemporary art's appeal has never been greater – and the stakes have never been higher. The ArtReview Power 100 looks at the artworld not according to what it shows, but who it is. The list is a highly visible barometer in an otherwise opaque industry, letting you know who's deciding what you see, and telling you a little about why.

On number 1 this year: Damien Hirst. What a surprise.

From London to Moscow

Phillips de Pury, one of the largest auction houses in the world, has been sold to a Russian group, according to a report in the Financial Times last week.

A chilly Frieze?

"A lot of people just aren't in the mood to spend": The Wall Street Journal reports on the lowered expectations of the Frieze Art Fair.

Wishful thinking

Don Thompson, author of the book 'The $12 Million Stuffed Shark', on investing in art anno 2008:

The best of the best, the masterpieces, will always do well. But this is probably not the best time to invest in a portfolio of mid-market art. Remember that for all the talk of investment, you have to make 15 to 20 percent per year on it to cover the cost of capital and storage and insurance. What work today would you say would appreciate 20 percent a year for five years? If you want to buy a masterpiece as a store of value, that’s fine, but if you think of it as a high-yielding investment, that’s wishful thinking.

Read more here.

Back to the Future

Now that the end of the art boom may be in sight, it is good to look back a year or twenty:
- The Art Boom: Is It Over, or Is This Just a Correction? (The NY Times, December 1990)
- The Market's Blue Period (The NY Times, May 1992)

The end of the boom?

According to The Times "investors in stamps, jewels and wines may not escape the global economic downturn".

Rics spokesman Andrew Davies of AXA art insurance says: “There is an urban myth that fine art and antiques are recession-proof. This is wrong. This market lags behind the economic cycle by around a year to 18 months. So people should not rely on it. (...) The bottom end of the market is dead. I went to an contemporary art auction last week where there were 283 lots and only 82 lots sold. That is appalling. Those that did not sell were in the £1,000 to £5,000 range."

Frieze!

It's that time of the year again: the Frieze Art Fair is coming to London next week.

Why the art market can't crash

...and why it will anyway.

In the art world, there’s a clear delineation between those who experienced the last crash, in the early nineties, and those who didn’t. “This market is fueled by collectors who have never been through a correction,” says art adviser Darlene Lutz, active since the eighties. “The generations who did are watching this with disbelief. It’s like teenagers who have unprotected sex thinking they’ll never get pregnant. And then, whoops . . . look what happened!”

(Note that the article was written in March 2006.)

Big bucks for Bacon

Ever wondered why Francis Bacon's work has become so exceptionally highly priced? The Art Newspaper explains. The Bacon exhibition at the Tate opened last week.

Bedtime reading

On the reading list: a new book by James Goodwin on international art markets. The chapters on The Netherlands and Belgium are written by Rachel Campbell and Victor Ginsburgh respectively. No surprises there.

Damn, Damien (2)

The Guardian reports on the Hirst sale: "Hirst is unlikely to feel disappointed - he has made more money in two days than all the artists in the National Gallery earned in a lifetime."

Damn, Damien

Despite a financial market crisis, the Damien Hirst auction at Sotheby's London did surprisingly well. (Last week, The Economist published this article on Hirst and the sale.)

Fall Forecast

Artinfo.com looks forward to the fall. According to one painter the big trend will be "more of the same, only less money". We'll see.

On my schedule for the fall: Francis Bacon and Mark Rothko.

Paintings with cows never do well. Never.

Art+Auction just published its "Annual Investment Issue". Especially interesting is the article by Don Thompson on investing in art. An excerpt follows.

Bright colors do better than pale colors. Horizontal canvases do better than vertical ones. Nudity sells over modesty, and female nudes for much more than male. A Boucher female nude sells for 10 times the price of a male nude. Representations of people do better than landscapes. A still life with flowers is worth more than one with fruit, and roses are worth more than chrysanthemums. Calm water adds value (think of Monet’s “Water Lilies”); rough water brings lower prices (think of maritime pictures). Ship-wrecks bring even less.

Purebred dogs are worth more than mongrels, and racehorses more than cart horses. For paintings that include game birds, the more expensive it is to hunt the bird, the more the bird increases the value of the painting; a grouse is worth three times as much as a mallard. There is an even more specific rule, offered by New York dealer David Nash: Paintings with cows never do well. Never.

Beautiful inside his wallet

On September 15 and 16, Sotheby's organizes a special auction consigned by Damien Hirst. The sale carries the title "Beautiful Inside My Head Forever", features 223 works by Hirst (butterflies! dot-paintings! formaldehyde!) and is expected to net the artist more than 120 million USD.

The most important art pieces ever?

A NY Times article on David Galenson and his research. Also includes quotes by Victor Ginsburgh and Michael Rushton.

What do you want?

Wants For Sale is a project by a NYC-based couple of artists. The concept is simple: they paint something they want (a watch, an Adidas shoe, an iPhone, underwear), sell the painting for the price of the item and then go and buy the object they wanted. Still for sale at this time: 'Want A Little Shopping in SoHo' ($2,500) and 'Want Charles Saatchi To Buy This Painting' (only £1 - the painting reads "Instant Street Cred").

(The artists also have a charity-project called Needs For Sale.)

For sale: Art and optimism

The New York Times reports on the high estimates in the upcoming auctions. "You can’t help but wonder just how many of the smartly dressed people sitting night after night at Sotheby’s, Christie’s and Phillips de Pury over the next two weeks will be serious bidders and how many will be voyeurs hoping to witness an implosion of the multibillion dollar art market. For years collectors and the news media have been speculating about when prices would finally top out. Spring sales estimates don’t suggest pessimism."

The Francis Bacon triptych pictured here has an estimate of about 70 million USD.

The recipe for a record price

Auction house hype, media frenzy, and billionaire buyers.

Nobody understands better than an auction house that price appreciation of this magnitude is seldom intrinsic to the work.

Andy, Pablo and Francis

A couple of weeks ago, Artprice.com published its yearly overview of art market trends. It contains interesting insights in the "suicidal competition" in the art market and the remarkable rise of contemporary Chinese art (for example from Zhang Xiaogang and Yue Minjun). Anyway, 2007 might have been the last year without Asian artists in the top-10 of artists based on the total revenue generated by public sales (2006 ranking between brackets):

1 (2) Andy Warhol [422 million USD]
2 (1) Pablo Picasso [320 million USD]
3 (19) Francis Bacon [245 million USD]

4 (79) Mark Rothko
5 (14) Claude Monet
6 (9) Henri Matisse
7 (37) Jean-Michel Basquiat
8 (26) Fernand Léger
9 (6) Marc Chagall
10 (17) Paul Cézanne

Have fallen out of the top-10 this year: Modigliani, De Kooning, Gauguin, Liechtenstein, Schiele and Klimt.

Why we like art less...

...when the price goes down.

Press clips

Some interesting articles:
- London banks sell Old Masters, buy Contemporary
- Banksy chimps get sliced up
- Art funds expand in emerging markets...
- ...but Belgians don't really care

The Acid Test

"The historic month of January 2008, when the art market and the broader economy spectacularly diverged, will be debated at length by future historians of Western societies."

Read the full article from 'Art + Auction' here.

Another Belgian in America

Last week, I went to see one of the most expensive paintings ever sold: 'Portrait of Adele Bloch-Bauer I', by Gustav Klimt. The work hangs in the beautiful Neue Galerie, in New York. I was happy to see that Adele is flanked by two nice sculptures by George Minne, a Belgian Symbolist artist.

At the end of 2007, the New York Sun reported: "Exactly 100 years ago, Gustav Klimt's iconic portrait of Adele Bloch-Bauer, now enthroned in the Neue Galerie and possibly the most famous painting in New York, was exhibited in Vienna between two soulful and sinewy sculptures by the Belgian artist George Minne. Today, after a tumultuous century of world wars and totalitarian regimes, the two sculptures have turned up on the Upper East Side at the Neue Galerie. There, once again, they flank the ethereal Frau Bloch-Bauer. All three works had belonged to her family before they were confiscated by the Nazis. Two years ago, after the Klimt portrait was finally "restituted" to her descendants, they sold it to the Neue Galerie. Now they have donated these two sculptures."

Read the full story here.

Tintin in America

AFP reports: "Captain Haddock would have choked on his whisky: original artwork for a Tintin comic book fetched a record 764,200 euros (1.2 million dollars) at a Paris auction Saturday, organiser Artcurial said.

The 1932 oil painting, executed for the iconic cover of "Tintin in America" smashed the previous world record for an original comic book work. That was set in March 2007 when a drawing by artist Enki Bilal called Bleu Sang (Blue Blood) fetched 177,000 euros.

Judged a "museum piece" in Artcurial's auction catalogue, the painting by Tintin's Belgian creator Herge finally sold for 764,200 euros, including expenses. Total earnings for Saturday's one-off sale of 650 comic originals -- each of which had a starting price of 280,000 euros -- came to roughly 3.4 million euros, the gallery and auction house said."

Good logic

'Salathé & White' is an interesting project of the artists Marcel Salathé and Anthony White. Some information from their website:

- The project:
"To sum up the project in one sentence: we auction our collaborative paintings and guarantee to buy them back at a specific price, indicated on the painting, upon safe return during a specific month, also indicated on the painting. Put differently: each painting is a bond or more precisely a zero coupon bond."

- Why?
"Here is the reasoning behind the first Salathé & White painting:
1. Everything is valued by the price someone is willing to pay. Art is no exception.
2. The longevity of a piece of art depends on its value, not its beauty. That's because beauty is in the eye of the beholder, while money is not.
3. The price someone is willing to pay is generally influenced by the price paid before.
4. Hence, the first price paid is crucial.
5. Ergo: the longevity of an artwork is crucially depending on the first price paid.

If you agree with this logic, that's because it is good logic.

If you disagree with this logic, that's because it is art."

Their second painting (see picture) was just auctioned on eBay and sold for no more than 960 dollars. A bargain.

Recession? What recession?

Artinfo reports on TEFAF.

Quote of the day: "If this is a recession, then long may it continue."

Art etc.

Some art (market) news from around the world:
- Excitement at art fair in Maastricht
- Chinese art-buyers in overdrive
- The world's most popular museums - and the most visited exhibition
- UK art dealer becomes art philantropist

Fun with funds

Do you have some spare money you'd like to invest in art? Next to the Fine Art Fund, some new possibilities are popping up. The Vienna-based hedge fund company Sharpe Investments has an investment fund called Sharpe Art and an Italian fund manager is launching a new 150 million art fund, together with Simon De Pury.

"The art market did not suffer repercussions when the Internet bubble burst and it is doing extremely well today, even after the credit crunch," said Robert Tomei, chief executive of the Italian fund manager Advanced Capital, who is starting his third art fund.

The Tomei Advanced Capital Art Fund, run with the art dealer Simon de Pury of Phillips de Pury, will focus on contemporary art, photography and design and hopes to replicate the 20 percent annual returns he achieved with past funds.

Freudian times

Two important Lucian Freud exhibitions are held this year, one at each side of the Atlantic. In New York, the MoMa hosts 'Lucian Freud: The Painter's Etchings' (until March 10). Art Knowledge News reviews this show. In The Hague, you can go to an impressive retrospective:

Art's economic indicator

The Whitney Museum of American Art in New York holds its 2008 Biennial until June 1. Read the reviews by The New York Times ("And this year we have a Whitney show that takes lowered expectations — lessness, slowness, ephemerality, failure — as its theme.") and Artnet ("And indeed, the dominant sense you get is of things half-finished or things falling apart."). The NYT article also contains an interactive feature guiding you through the exposition.

Van Gogh in Maastricht

Next week is going to be an exciting one. Maastricht hosts both the annual Art Markets Symposium and Tefaf, one of the world's most important art fairs. One of the highlights of Tefaf is this painting by Van Gogh, 'L'enfant à l'orange'. Expect to pay more than 30 million USD.

Weak dollar, record sales...

...at Sotheby's in London.

“The global hunger for great works of art is here to stay,” said auctioneer Tobias Meyer after the evening’s heady sale. “It’s become a 20th century masterpiece market.”

Art market watchers

Reports on last week's Impressionist and Modern Art sales:
- The International Herald Tribune
- The Economist
- Artnet.com

A dangerous game

"Contemporary art sales could contract as rapidly as they expanded. A ludic element rather than passion drives many new buyers. Should worries about the economy instill fears in them, the newly affluent Chinese or Russian or Arab buyers might not find it difficult to defer the acquisition of status symbols or to renounce the temptation of making patriotic statements by overpaying moderately coveted works."

In the International Herald Tribune, Souren Melikian (again) warns us that dangerous games are being played in the art market.

Auction houses

"An old saying in the art world is that the difference between the two houses is that Christie's (still in European ownership) are gentlemen that try to act like businessmen, whereas Sotheby's (under primarily US ownership) are businessmen who try to act like gentlemen."

(Clare McAndrew, The Art Economy, 2007)

The Art Economy

"Driven both by external demand and internal developments, the modern art market has begun a process of evolution, and is emerging as an international financial trading platform, in which art works and information about them are exchanged by a widening group of investors, many interested in the financial nature of the asset class as much as it aesthetics."

That is one of the first sentences of 'The Art Economy - An Investor's Guide to the Art Market', a new book by Clare McAndrew that I have just begun to read. I hope it contains some interesting insights.

To boom or not to boom

"Auction rooms will be less fun in the year to come than in the year gone by. Throughout 2007, stories of astonishing sales records tumbled out of the press offices of Christie’s and Sotheby’s. Christie’s boasted the highest half-yearly sales in art-market history; Sotheby's claimed the highest global turnover in the company's history “by a wide margin”. Some enthusiastic players in the game came to believe the boom would go on and on. But it can’t, and it won’t."

The Economist on the art market in 2008.

A story

"There is an often told story of a boy who
found two ripe apples as he was walking home
from school with a friend. He kept the larger one
for himself, and gave the smaller one to his friend.
"It wasn't fair to keep the larger one for yourself",
the friend replied. "What would you have done?",
the first boy asked. "I'd have given you the larger
one and kept the smaller one for myself", said the friend.
To which the first boy responded, "Well,
we each got what you wanted, so what are you
complaining about?" (Rabin, 1998)

Yes, I'm following a course in behavioral economics.

Artists and the market

"In an era in which there is open discussion of many previously forbidden subjects, including race, sex, religion, and drugs, why is it that the nexus between money and art remains perhaps the last taboo subject for many in the art world?" David Galenson is an economist at the University of Chicago writing on the relationship between artists and the market and many other art-related topics.

An industry or a luxury?

"Is art an industry or a luxury?", asks the Wall Street Journal. "Wrong question", argues Tyler Cowen.