Friday, November 14, 2008

Art Market Takes a Hit

I've never understood the high price of art, especially contemporary - the incredible prices for some of these things makes me believe this is just a way for the world's rich to burn off extra cash that would otherwise sit in a safe. Granted some exclusion for things that are rare and historical I suppose, but that's just an uncouth personal take from someone who, with the means, would rather own something like a NFL franchise ;) To each their own.

But these stories show the economic malaise continues to move up the food chain [Nov 8: Bloomberg - Even Pawn Shops in Beverly Hills are Booming] - to the very top in this case. Keep in mind while 20, even 10, years ago much of the world's art money was in Western countries - the past 5+ years much of the BRIC nation riches, along with petrodollars came into this market.
  • In a salesroom overflowing with collectors like the actor Steve Martin, the financier Eli Broad and the fashion designer Valentino, Sotheby’s barely managed to sell $125.1 million worth of contemporary art on Tuesday night, well below the low estimate of $202.4 million.
  • “It was a half-price sale,” said Mr. Broad, who went on his first shopping spree in several years. In less than 90 minutes, he dropped more than $8 million (including Sotheby’s fees) on works by Ed Ruscha, Jeff Koons, Robert Rauschenberg and Donald Judd.
  • Sotheby's sold 68 percent of the art it offered, its lowest selling rate for a multiple-owner evening auction of contemporary work since November 1994. He said prices had rolled back to 2006 levels. It was obvious throughout the evening that Sotheby’s had worked hard to persuade sellers to lower their expectations. Many works sold, therefore, but for well below their estimates.
  • But when Mr. Meyer and Sotheby’s experts were putting together Tuesday night’s sale, it was summer and the world was a far richer place. (how quickly the world changes - commodities were the hot investment, and shorting banks was cool ... ok some things never change)

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