In a recent interview with the director of auction house Sotheby's in central and eastern Europe, Lord Mark Poltimor called emotion art dealers scaremongering from scratch, and this view seems most sensible. The panic and disorientation - eternal satellites of any hazards, whether war or financial crisis, the auction houses have caused more damage than the loss of purchasing power of their customers. But the panic - a short-term phenomenon. Today, after three months from the beginning of the collapse of global stock exchanges, the theory receded into the background, giving way to reality. The financial crisis began, the recession is inevitable, and the art market has not remained aloof.
Over the last ten years the art market has demonstrated unprecedented rates of growth. The development of world economy, consumer culture and the increasing globalization provoked a steady demand for works of art, and the proposal was not long in coming. In just one decade, culture-art of management has become a powerful, perfectly tuned mechanism, living, despite some of the features common to the laws of the market. Home specificity of art lies in the fact that it has no real cost and, unlike gold, stocks and oil, is not a commodity. It is certainly valuable, but the cash equivalent of each individual product can be defined in a specific socio-economic context. Recession economy collapses (and could not crush) the art market, but has changed the context, placing both the seller and the buyer before the fact of an acute mismatch of supply and demand.
With the growth in stock prices and oil price of art has reached incredible heights, and at a time when the purchasing power of people fell, auction houses simply do not have time to tune out the suddenly changed climate. Unexpectedly, it turned out that such a popular yesterday Contemporary Art have lost their attraction, and not every collector is ready to give millions for work, say, the same Damien Hirst. Recession has affected even these time-tested lines as the Impressionists and old masters, which resulted in the immediate reform.
The first prerequisite to a change in the pricing system has emerged in the late summer. Then a series of unsuccessful bidding forced dealers (among them was even a giant as Sotheby's) to recognize the discrepancy estimate: the actual market situation. The sad events of the fall auction houses forced to resort to the widespread practice of selling below the minimum estimated value, and then the program reduced margins.
As a result, today collectors a unique opportunity to acquire works of art at a much lower price.
You may find that this situation was repeated many times in the past. Crises and excitement, regardless of what they were called, always provided the buyer (unlike the seller) a lot of interesting possibilities. Thus, it is in the midst of the Great Depression of the 1920 - 1930., American industrialist Solomon R. Guggenheim Foundation has acquired the first works for his collection, which later became the basis of one of the world's largest contemporary art. Collector's niece, the famous Peggy Guggenheim, went in the footsteps of his uncle. Shortly before the German occupation of France in 1940, she visited Paris terror-panic. Despite the danger, she tirelessly avoided the galleries and artists' studios, buying seriously cheapened art, including works by Pablo Picasso, Fernand Leger, Gino Severini, Kandinsky and other great masters of European modernism.
Turning to recent history, you can remember 1990-ies., Which were also not the best time for the world economy. However, these years gave the world the new names of contemporary art, prevailed on Olympus art market in the 2000's. Many of the galleries, which started 15-20 years ago, has now reached a very impressive results. The best example was the work of British millionaire Charles Saatchi. Putting on contemporary art, he began to support the young artists of YBA, where, along with others, included Tracey Emin and Damien Hirst, the unknown and virtually unused by the representatives of the London underground. Less than 10 years the price of their work took off in the hundreds or thousands of times, bringing Saatchi and other far-sighted investors truly fabulous dividends.
As can be seen, for many economic shocks can have significant advantages. Against the background of the total fall in the price collectors and art lovers have the opportunity to make interesting acquisitions, which were previously unprofitable or simply impossible. An additional advantage is the release to the market previously unavailable works, whose owners wish to withdraw the funds and invest them in other assets, such as in business. As an example, a recent Christie's auction in New York, where, among other lots sold 16 paintings from the private collection chairman of the board of directors of the company bankrupt Lehman Brothers, Richard Faldo.
Sale collections in crisis as unprofitable for the seller as it is promising for the buyer. The latter has an opportunity to make interesting investments, which, taking into account the willingness to wait a certain period of time, can yield significant dividends. The instability of the economic system, of course, reduce the value of per cent per annum, but, as we know, history tends to cycle, and it is very likely that, after several years bought "discount" the product will return to the previous price category.
While the price of art continues to fall, those who remained free funds, may well follow the example of Saatchi and the Guggenheim. The question remains, what directions the art market are the most reliable and which suffered from the crisis stronger than the whole.
The most stable, according to experts, is "first hundred" artists submitted art impressionism, modernism, and old masters. The most expensive liquid "honored" masterpieces, the value of which is recognized and does not depend on external factors. Let Suprematic Composition by Kazimir Malevich and was unable to bring Christie's cherished $ 80 000 000-100 000 000, it is always justify the means invested in it regardless of the further turn of events. That is why the upper price segment of the auction sales of the least affected by the financial crisis. The same situation is about the art of impressionism, old masters, icons, decorative art and other antiquities. Criteria for evaluation of these works evolved over tens or hundreds of years, and, despite significant fluctuations in the market,
, they remain a reliable investment.
Much more complicated situation arises in the market of contemporary art. Works by Gerhard Richter and Lucian Freud hardly lose in price, otherwise it "trendy" artists who have reached the peaks on the wave of "boom". Art market perfectly mastered the techniques of advertising and pr-technology, pouting over the past years quite a few "bubbles". Fashion was one of the main motivators in the market of contemporary art. But fashion is fleeting, and many works for which only yesterday without hesitation gave millions of dollars, lost their attraction.
Today, more often to hear about the "beneficial effects of the crisis on the art market. In the mouth this phrase dealers often looks like a desire to maintain a good face on a bad game, but, in general, it is justified.
A recession makes it possible to figure out whose work truly original and worth of investments, and who worked for the needs market . After the crisis, which according to different projections last from one to three years, many popular names of today may be in the past. In their place will be new artists, which is likely to create some new direction in art.
In the end, history knows many examples when the hard times gave rise to the outstanding talents.
http://www.antiq.info/news/news_and_...nts/11261.html
04.12.2008, 21:20
Eternal values become cheaper ...
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