ART AS AN ASSET

I thought you might find the following interesting. We have talked about this before – in the mid 80’s I believe.
 
The Wall Street Journal reported in a recent  article that wealthy people are more and more inclined to invest in art as an alternative to traditional financial investment. I am not sure what is meant by “wealthy” people.  The article states that Christie’s sales were up 14% in 2011 to $ 4.9 billion and included $ 808.6 million in private sales.  To what extent is this true for Asian art?  We have certainly encountered some very serious buyers, mainly from China but how much of this can be categorized as  investing I cannot say. The market is out of balance  with the highest prices going for Chinese paintings – this leaves Chinese bronzes relatively underpriced and perhaps a good investment. Dealers and buyers at the recent  FAA (Fine Art Asia  Fair, the Asian answer to Maastricht’s TEFAF -European Fine Art Fair in The Netherlands)   in Hong Kong held in October 2011  seemed to have felt that way.
 
 The WSJ  went on to say :
 
(Excerpted from WSJ and Appraisers Workshop/Todd Sigety, http://www.wsaappraisals.com/)

Quote
Steven Murphy, chief executive of the privately held Christie’s, said collectors and investors alike see art as a potentially safe haven for their cash at a time when the broader financial outlook remains volatile: “Everyone is doubling down on art,” he said. “That’s why our market is so strong now.”

Overall, art values rose 10.2% last year, according to art-market analyst Michael Moses, whose New York firm Beautiful Asset Advisors runs indexes that track shifts in the sale prices of thousands of artworks that have sold at auction more than once over the years.

The pace of art buying varies around the world, though. Collectors in the U.S. shopped cautiously last year, with Christie’s sales in America dropping 3%, to $1.9 billion, from the year before. Its sales also were down 64% in Dubai, to $18.6 million. On the other hand, European collectors—particularly those from Italy and Switzerland—stepped up their bidding. Christie’s sales in Europe totaled $2.2 billion, up 29% from 2010.

Christie’s greatest triumph came from Roy Lichtenstein, whose 1961 comicbook-style painting of a young man staring through a peephole, “I Can See the Whole Room…and There’s Nobody in It!,” sold for $43.2 million in November, setting a new record for the Pop artist.

Sotheby’s fared even better with Clyfford Still’s jagged abstract, “1949-A-No. 1,” which sold for $61.7 million in November.

Both houses seized on collectors’ wider interest in contemporary art, a category that includes works created since 1949. The style is particularly popular with newly wealthy, younger buyers who want art made by their generational peers.

 

Unquote

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