The art market bubble of the last few years has been threatened – or at least put on hold – due to the current crisis in the world’s financial markets.
Yet, art continues to sell. The art market has rippled in response to the ailing financial markets, not followed suit.
Some prices, especially at auction have fallen or basically stayed at minimum estimate, while others have slightly increased. At the recent Sotheby’s sale of 20th-century Chinese art in Hong Kong, two-thirds of the lots went unsold. Two weeks earlier at Sotheby’s New York ale of Impressionist and modern art early in October, 263 of 326 lots sold, which is good..
According to the economic news commentators, the stocks that are currently selling – at plunging prices – are “forced sales”. They are being sold by people or firms who need cash desperately, and by money market managers who need to cover withdrawals, even if they have to take a loss. The stock market is plunging, but it is not plunging based on high volume trading. Most people are holding on to wait and see what happens.
It can be expected that some stock market investors who are also art collectors could determine that holding stocks and riding out the storm can be accomplished by selling art, which so far has basically not lost its value.
Months ago due to signs of a recession, a possible art market dip was discussed by dealer Mary Boone. She has weathered the vicissitudes of the art market, which is often tied to the financial markets previously. When the market slows and dips in a recession galleries and artists are often forced to lower the prices for an artist’s work, especially if previous work declines in price at auction.
Even when an artist’s prices at auction are obviously lower due general economic conditions, the artist is perceived as being worth less. Art is all about perception. After the financial sector and the art market began to see gains, some of the artists whose works suffered in price during the last recession were overlooked for years, while newer artists quickly filled in their space and superceded them in price.
Ironically, over time the better bet for investors has proven to be holding onto their art. Unlike stocks, great and even much good art survives to eventually regain and supercede its highest price. Many companies and their stocks falter. Remember the dot.com bust? How many of those companies are around today? Although that bear market led to many living artists enduring lower prices for their work, today most have regained and then surpassed their former prices for their new work, with their previous work selling at even higher price points. [I will not name names to protect some artists, but this data is easily found by doing some research on artnet.com]
Princes for oil, gas, food and other goods have been climbing slowly but steadily since the winter of ’08. The dollar is falling in relation to other currencies during the current financial crisis. That means it has less buying power in relation to other currencies. If the government of the USA decides to print more money to handle billions of dollars it is pouring into the bailout(s), the dollar will be worth even less.
In my high school history text book there was a political cartoon that had been printed in a German newspaper before Hitler’s rise to power. The image illustrated the rampaging inflation of that era, by depicting people pushing wheelbarrows filled with paper money to buy something like a loaf of bread or gallon of milk.
Psalm 22 (Rembrandt)
|The ravages of war, political upheaval and catastrophic weather and natural forces have proven that art, gold and precious metals and gems hold recognized value over time. Ten pounds of gold, a small bag of good quality high carat diamonds, a Rembrandt, van Gogh or Klimt will generally hold and then surpass its current value over time. Van Gogh and Klimt were used as their work was not as valued at the time of the German inflationary period as they are today.
While some lower and mid range galleries will fold as discretionary income reduces. Those galleries that represent blue chip artists, plus those galleries that can find and represent emerging artists with unique voices and theories (especially painters as paintings sell the best at auction) will easily pull through the financial crisis and possibly even thrive. So will their collectors.
Collecting art is a passion, but it is also an investment and thus, involves risk. As a result of a recession, some lower and mid range galleries may fold as discretionary income reduces for collectors.
Those galleries that represent blue chip artists, plus those galleries that can find and represent emerging artists with unique voices and theories (especially painters as paintings sell the best at auction) will easily pull through the financial crisis and possibly even thrive. So will their collectors.
In November Sotheby’s will hold an important sale of Impressionist, Modern and Contemporary art. The global nature of the art market has previously bolstered sales even though the USA was experiencing the financial stress of the housing markets and oil prices. Now that the financial crisis has gone global, the next auctions and art fairs anxiously awaited.
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Judy Rey Wasserman is an artist and the founder of Post Conceptual Art theory and also the branch known as UnGraven Image Art at ungravenimage.com.
Post Conceptual UnGraven Image Art theory is based at the intersection of ancient spiritual wisdom and cutting-edge contemporary science. It shows us a new and enhanced spiritual and science-based way to see the world. It is a life changing vision that can even become an actual new way of seeing that is a fulfillment of biblical prophecy. Can this be true? See for yourself.
Check out the Fine Art Limited Edition prints, decorative prints, books, and printables that are currently available to you through Judy Rey’s Art of Seeing The Divine Shop. You don’t have to buy to avail yourself of the art and inspiration available there. However, if you select to collect investment quality archival art, or decorate your home with images created with strokes that are original letters from Bible texts, or buy a gift for someone special, there is a secure shopping cart that accepts most credit cards so your purchase is easy to accomplish. https://artofseeingthedivine.com.
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