Tuesday, November 17, 2009

Buying Art in the Information Age : Open Thread

I remember it like it was yesterday. Art market articles across the spectrum of the art press spreading the story in sync of how the new boom of the early 2000's was quite different from the previous booms because the collectors buying then were so much better informed than those who had come before them. In 2003, for example, art market guru Richard Polsky wrote:
In this day and age, with information being so readily available, both collectors and dealers are unusually well-informed about what works of art are worth. The good news is that there are no surprises. The bad news is don't expect to steal a deal.
Uh...er....Surprise!

In yesterday's
New York Times, in an article titled "Art Prices (and Mood) Inch Back Up," Carol Vogel provided an update on the what it means to be "unusually well-informed" now:
Last fall there was a sense of panic because nobody knew if prices had hit bottom, not just for art but for any asset, and even the richest collectors froze. This season was all about the estimates. “Ultimately that’s what provided buyers with the confidence to bid,” said Tobias Meyer, worldwide head of Sotheby’s contemporary art department, who added that for some artists, prices have dropped more than 40 percent from their high two years ago.

The deliberately low estimates became catnip for bidders. Or so it seemed when Warhol’s 1962 silkscreen painting “200 One Dollar Bills” incited a bidding war among five collectors and ultimately sold for a staggering $43.7 million (including Sotheby’s fees), more than three times its $12 million high estimate.

Would what proved to be the star of the last two weeks have made more at the peak of the market? No, said both Mr. Meyer and Mr. Porter. Mr. Meyer pointed out that during the boom, big money went for highly colorful images like a 1976 triptych by Francis Bacon ($86.3 million in May 2008) and a Rothko canvas, the 1950 “White Center (Yellow, Pink and Lavender on Rose),” from the collection of the retired banker David Rockefeller ($72.8 million in 2007).

“Because this Warhol is black and white, it could have very well been overlooked at the height of the market,” Mr. Meyer said. “Although it is art-historically important, it takes a little knowledge to appreciate.” [emphasis mine]
Taken together (i.e., the sense that collectors were well informed in 2003 and the sense that they were not so well informed a mere four years later), I think you can interpret Mr. Meyer's statement now one of two ways.
  1. Either so many new people entered the art market between 2003 and 2007 that they watered down the overall intelligence of the collector base, or
  2. Being "well-informed" in 2003 meant knowing what art was worth in terms of cash, but being "well-informed" in 2009 means knowing what art is worth in terms of its importance in art history.
Standing back and thinking about the 2003 and 2009 senses of worth, for just a little bit, one has to wonder when they'll merge and the conventional wisdom will become that being "well-informed" means both: knowing what art is worth in terms of cash AND what it is worth in terms of its importance in art history. That would, obviously, be ideal.

The problem, of course, is that to some degree both constantly shift, with or without a boom market.


The other problem too is the calculus for sorting out a combined sense of worth. If a work is
kind of art historically important and the artist has a waiting list, is it worth more than a work that is very art historically imporant but the artist (or his or her estate) has plenty of inventory?

I know. Maybe we need a computer program, like the ones that helped Wall Street come up with all those credit derivatives and credit default swaps, to tell collectors what a work of art is worth. That should boost confidence in the market again, no?


Consider this an open thread on how all the information so readily available either helps or hinders confidence in buying art.

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11 Comments:

Blogger George said...

OK, but since I'm an artist, I only want to hear from collectors.

11/17/2009 10:21:00 AM  
Blogger ruben said...

I personally feel that from the latest art auction results and with the stock market holding up, it will benefit and energize the art market in general. Art Fairs like Miami Art basel might experience a difference if, everything continues in the same upwards trend we had seen during the last few weeks.

11/17/2009 11:39:00 AM  
Blogger Edward_ said...

Thanks Rueben, I hope you're right about energizing things...

from your point of view as a collector, though, does access to more and more information automatically give you more confidence in acquiring art or is that notion overstated?

11/17/2009 11:46:00 AM  
Blogger Tatiana said...

AND there seems to be a trend in art market writing, Polsky included as well as Rosenquist (& Donald N. Thompson)... have new books on the contemporary art market...a lot is biographical info..but still....fascinating.

11/17/2009 01:30:00 PM  
Blogger zipthwung said...

What are your motivations behind collecting: a souvenir or an experience? Nostalgia? Pawns in a curatorial game? A bookmarker? (let us have a show of bookmarks!)

Autograph seekers are fine -it's a game like any other - but the charge is different - trainspotting, for example has little or maybe even nothing to do with actually riding the train.

Art can be appreciated on several levels - and it is an intentional fallacy to worry too much about what the artist intended or simply an error to assume art has absolute meaning because of some biographical backstory - even a cannonized one.

For example, a bayonette could be loaded with meaning for a veteran of D-Day, but have an entierely different meaning to a native of Borneo.

That is why I am suspicious of collectors who try to buy their meaning at an impersonal auction - as if ownership of the artifact and coffee table book bestowed the ownership of the meaning, membership in the club, or otherwise privileged position.

Surely this meaning has nothing to do with artists and more to do with the meaning found in the act of collecting.

11/17/2009 08:08:00 PM  
Blogger CAP said...

Hear, hear.

Unfortunately the drive is still to think of collectors as investors, and a of strictly market-driven art history.

By....

Collector: Think not what the market can do for you, think instead what the acquisition means (i.e. represents, stands for, or refers) to you.

If it's only about 'bookmarking', as Zip aptly notes, a place in history or market advantage, then choices are still rash or ill-informed. What the collector has to collect is what matters most to the collector. Collecting is a bug, whether it's antiques, vintage cars or costume - and there are every conceivable kind of collectors, who collect firstly for the pleasure of collecting some private, often seemingly arbitrary category of object. Art is a more recognised category obviously, but within that styles or genres proliferate in every direction. Do we really want to view history so narrowly as one astonishing ‘breakthrough’ after another? Not even science offers that certainty. Controversies between theories and test results allow only the most general acceptance. Yes, earth orbits the sun, gravity may be a strong or weak force, depending on breakfast and whether we can get dark matter to properly matter, or not be so dark!

‘Progress’ is not an infallible or reliable measure, in art or elsewhere. Shun the Sotheby’s/Christies’ ponzi scheme of a guaranteed place in the one and only evermore art history. That ain’t going to happen. Go and look at forgotten or discredited art histories. Look at all the academic or salon-driven monstrosities from the 19th century. They turn up in clearance auctions and car-trunk sales across a crumbling Europe. There is no privileged information on the future and its possible history. Better to make your own! Start with your tastes and inclinations. Build a collection that is you in ways that only you can appreciate.

11/18/2009 01:25:00 AM  
Anonymous Gam said...

I concur a lot with zipthwung here.

Irrespective of the amount of data that one has access to, to make an informed decision one still moves through the typical cognitive processes. You need to perceive the patterns in the data, apprehend the insights within the patterns, understand the significance of the insights and judge the veracity of your understanding. Having lots of data gives more definition to the patterns but all the rest fo the cognitive moves, that still remains up to the individual, - data doesn’t in of itself make you wise, it’s what you do with the available data which allows you to do become so.

Appreciating art does have a ground in intellectual understanding, but it also is significantly grounded in the affect, are you touched? Does it resonate within you, it’s that personal intimate relationship which is the forte of art, like a lover you return to the artwork again and again and discover something new which was actually there all along, the deeper your understanding and appreciation of that relationship (and not necessarily of the art piece,) the greater depth of your own self awareness. Obviously the art aficionado is not necessarily the art purchaser as Zip elucidates. Yet the non-commercial value of art, is likely in its ability to allow us to understand ourselves, the insights and beauty that resonates with oneself, actually reveal more about us then they do of the artist.

11/18/2009 06:30:00 AM  
Blogger zipthwung said...

critical

Hadn't seen this - not my find.

Let the games begin.

11/18/2009 01:52:00 PM  
Blogger ruben said...

I would say that, yes to some extend seeing that the art auctions and a stronger stock market will, motivate me to further art collecting. It is just like consumer confidence about buying when the economy picks up. Even with the art market being down , most people said it was the best time to buy, I continued but ,a very very slow and careful pace and with great hesitation . In a slow market might have better bargains but, the art inventory is so large and saturated that can be quite overwhelming.

At some point, I wanted to stop visiting galleriers because, did not wanted to see and feel the desperation of art dealers and gallery owners.I personally like to collect more during a strong art and stock market.

Lately, I had been at a couple of art auctions and liked what I witnessed. People are more careful but, very determined when they want an art gem for their collection. You should always buy what you really like but, when it comes to big bucks art purchases, the investment must be always considered.

I think that if most art dealers make a very careful and strong selection of artists works for Miami Art Basel (not a safe one in most cases) , if this good wave of good art news continues, they might be some strong sales. Off course, I will be that fly on the wall ...watching it go down!

11/18/2009 02:18:00 PM  
Blogger zipthwung said...

Watch it from all angles:

camera 1


camera 2

camera 3

(you can skip camera 1 and 2)

11/18/2009 05:01:00 PM  
Blogger Brent said...

"Transparency" generally leads to more "efficient" transactions. This leads to lower prices and lower margins for anyone between producer and consumer (This would include you, Ed!).

However ...

Art is a kind of anti-commodity, especially original art, and is about a pure luxury as mankind has ever devised (and one of the oldest as a pursuit!). It has no "intrinsic" value per se beyond the value of the materials used - the final value is based upon subjective measures, and the "competitors" for a piece of original art are only loosely coupled. If I were to purchase one of Joanne's pieces, for instance, there isn't real competition for her original artwork, only competition for my money! (For insatnce I may try to choose between one of hers and, say, a piece of video art)

I do think the art world could get a whole lot more transparent from an economic basis before it would suffer economically, but I am not sure how transparent I could actually get since valuation is not based upon intrinsic objective measures.

11/19/2009 10:15:00 AM  

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