The 2010 Art Market Review – artmarkeblog.com

The 2010 Art Market Review – artmarkeblog.com

2010 has been one of the most confusing, unpredictable and unexplainable years for me as an art market analyst. So many of the trends, events and fads that emerged during 2010 did not appear to be caused by the sort of conditions, have the same effects, or follow the same path of logic that one would expect they would given the way things have panned out in past years. This leaves me with no doubt that the art market is evolving at such a rapid pace that there is little point trying to justify or explain the events of today using logic that is based on the progression and events of previous years. In fact, more of the art market events that took place during 2010 appeared to defy logic than ever before. I do, however, strongly believe that one of the reasons that it has become even more difficult to determine what is going on with the art market is that the art market (auction houses in particular) has become adept at making the situation appear much better than it really is. Whether it be by skewing figures or manipulating the way results are perceived – galleries, fairs and auction houses have become the plastic surgeons of the art world.

What has also made 2010 such a hard year to analyse was the contraction, and slow regeneration, of the market for the work of trendy emerging artists and recent works by top contemporary artists – both of which are usually the most global, visible and publicised sectors of the market. As the market moves towards the work of artists with a proven track record, collectors and investors have shifted their focus from the usually dominant and globally relevant contemporary art market to the work of artists from a wide of variety of styles, mediums and movements that cannot appear to have very little in common. This has resulted in a situation where there is not one dominant global trend that art market analysts such as myself can focus on, but a number of smaller and disjointed trends that make reading the market particularly difficult.

A few months ago I wrote a series of posts on what I believed was a move towards a more sentimental art market, which appears to be exactly the direction that the market has headed. General disillusionment with the contemporary art market has sent many collectors and investors take a more sentimental approach to fine art that is characterised by a focus on the safety of more established artists and the familiarity of artists that they can relate to. When art collectors or investors seek safety and familiarity they are most likely to gravitate towards works by artists from the era and culture that they have the greatest connection to. This would explain the large number of seemingly unrelated trends that emerged during 2010 many of which involved previously unfashionable styles and movements that are distinctly associated with a particular era or culture.

There is no doubt that the art market has recovered far quicker than many people thought possible. Again, the unexpectedly rapid recovery has thrown a spanner in the works when it comes to analysing the art market and trying to make sense of what is going on. Some journalists and analysts have gone as far as to admit that they cannot explain how a market that seemed to be at breaking point could make such a rapid recovery. To give you an idea of how quickly the art market has recovered, in March of this year (2010) Walter Robinson, editor of Artnet Magazine, said that “Art Market Watch has been on something of a hiatus during the last few months. What with the recession, reporting on auction results just isn’t as compelling as it was during the boom years”. Six weeks later a painting by Picasso become the most expensive work of art ever sold at auction when it fetched a staggering $106.5 million. A week after that an Andy Warhol self portrait sold at Sotheby’s for $32.6 million (more than twice the estimate) setting a new record for a Warhol self portrait at auction. Compelling enough?

When it comes to rationalising art market events there is much to be gained from knowing who has money to spend and how much they have to spend. The top end of the market is fuelled by super wealthy collectors whose level of wealth would not have been affected enough by the financial crisis to deter them from buying art. Therefore at the high end of the art market things have been pretty solid as is evident from the number of record auction prices set in 2010. The lower end of the market is fuelled by collectors who focus on edgy and trendy contemporary art by emerging and newly established artists, and who will usually have a high level of interest in the cultural and artistic side of fine art. Collectors at the lower end of the market are a very determined group who are always going to be around even if they appear a little less active at times. Things at the lower end have improved but have done so at a less than rapid pace which makes it difficult to judge where this sector of the market is heading. Without a doubt the sector of the art market that has suffered for the longest period of time due to the effects of the global financial crisis and the art market downturn is the middle market. The middle market includes lesser works by big name artists, and the more expensive (less justifiable) works by the trendy contemporary artists, which makes the middle market a sort of currently un-necessary compromise for the super rich, and a stretch too far for the modestly well off. Middle market works are, however, perfect for the financial advisor and hedge fund manager types who are more interested in art as a status symbol than the quality or art historical importance of the works they are buying. With the pay packets of hedge fund managers and financial advisors taking a massive hit due to the financial crisis, there is little interest in the middle market works. The super rich are still rich enough to not have to compromise and settle for middle market works and the modestly well off continue to fuel the lower end of the market.
My next post will be the top ten art market 2010 so stay tuned……..

**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications

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The Most Revealing Art Auction Investigations – artmarketblog.com

The Most Revealing Art Auction Investigations – artmarketblog.com

Over the years many very interesting and revealing investigations into the inner workings of art auction houses have been conducted by journalists.  Having read most of the results of these investigations myself, I thought that it would be useful to provide a list of what I believe are the most informative and educational investigations to have been published in recent times.  If you are wondering at this point whether I hold some sort of grudge against art auction house then I can assure you that I don’t.  Most of the problems that have arisen with the art auction sector have originated from either one person or a small number of people who think that they are invincible and take things too far.

1. Halsey Minor, an internet tycoon and art collector, recently contacted me regarding a post I wrote on the sins committed by art auction houses.  Minor contacted me to inform me that he had recently launched an appeal against the summary judgement ruling in favor of Sotheby’s in their breach of contract action against him.  As well as informing me of the appeal, Halsey also provided me with a copy of the now publically available appellate brief for this case which you can view here:

https://docs.google.com/viewer?a=v&pid=explorer&chrome=true&srcid=0B8p8DAKg7zgqYjAyN2YwOGItNGY3My00YzNjLTkxMjEtZmI5NjdkMDQwYTBh&hl=en

You can also see the papers from the ruling in favour of Sotheby’s here:

http://www.scribd.com/doc/29409086/Sothebys-v-Minor-Judgment

Although I cannot comment on the appeal  as it is still being processed, I would urge everyone to read both sides of the case and make up their own mind.

2. In 2008 an Australian television program called Four Corners conducted an investigation into the actions of several major Australian auction houses.  Below is a link to a very interesting interview with Paul Sumner, the owner of Australian art auction house Mossgreen:

http://www.abc.net.au/4corners/content/2008/s2316296.htm

3. The biggest scandal to hit the art auction world was the commission fixing scandal involving Sotheby’s and Christie’s that surfaced in 2000.  See a particularly revealing investigation by the NY Times here:

http://www.nytimes.com/2000/10/08/us/secret-partners-unraveling-conspiracy-private-files-fuel-art-auction-inquiry.html?pagewanted=1

4. In 2004, Forbes magazine published an article titled ‘Dirty Secrets of the Auction Houses’ which is well worth taking a look at:

http://www.forbes.com/2004/07/09/cz_mr_0709soapbox.html

5. The Wall Street Journal published an interesting article in 2008 that looked into the way auction houses report their results:

http://online.wsj.com/article/SB122670620372529693.html

6. The Economist published a particularly insightful article in November that investigated several issues with the November 2010 Phillips De Pury ‘Carte Blanche’ sale:

http://www.economist.com/node/17551930

**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications

How to Avoid Dirty Art Auction Tricks – artmarketblog.com

How to Avoid Dirty Art Auction Tricks – artmarketblog.com

Having focused my last few posts on the issues surrounding the questionable practices of some art auction houses, I thought it important to let people know how they can avoid becoming a victim of dirty art auction tricks and tactics. The only real way to avoid becoming a victim of the art auction houses is to ask questions and to know which questions to ask.  Below is a list of questions, and the reasoning behind each question, that will ensure that you know exactly where you stand.

Seven questions every buyer should ask before bidding on a work of art:

1.       Does the auction house or anyone associated with the auction house have an ownership interest in the work of art I am thinking of purchasing?

(The reason you should ask this question is that if an auction house has an ownership interest in a work of art you should question whether this would have an effect on the way the auction house markets and presents the work of art in question – as well as the final price.  Auction houses are required to indicate in auction catalogues when they have an ownership interest in a work of art.)

2.       Is the auction house employee who is advising me on my purchases also representing the seller of the works they are advising me on?

(The reason you should ask this question is that it is not unknown for a specialist assigned to a particular client as an advisor to be representing the seller of the works they are advising the buyer to purchase.  If you are assigned an expert advisor by an auction house make sure they are not representing the seller of the particular works you are interested in.)

3.       Is there any doubt regarding the authenticity or provenance of the works of art I am interested in purchasing?

(The reason you need to ask this question is that auction houses are not always forthcoming with information regarding authenticity.  It is worth while making sure that you are getting what you are paying for.)

4.       Who has authenticated the works of art I am interested in purchasing, what qualifications do they have and what evidence was the authentication based on?

(The reason you need to ask this question is that auction houses have been known to justify the attribution they make using less than reliable information.)

5.       When were the works of art I am interested in purchasing last consigned to an auction and what was the result?

(The reason that you should ask this question is that auction houses are not always forthcoming with information regarding the consignment history of a work of art.  Auction houses have been known to sell the same work of art a number of times within a short period of time and not disclose this information to buyers.  It is important to know this information as it is likely there is reason that this has occurred.  It is also important to know this information because a work of art being passed in at auction can gain a stigma that can reduce the value.)

6.       Does the auction house allow the auctioneer to bid in his own sale?

(It should be obvious why one needs to ask this question, and yes, some auction houses to allow the auctioneer to bid on their own sale.)

7.       What is the condition of the works of art I am interested in purchasing and has a condition report been completed on each work?

(Auction houses are not always forthcoming with information regarding the condition of a work of art. It is generally expected that buyers will inspect a work of art themselves and will be aware of the condition of the work of art.  If you are not able to assess the condition of a work of art then hire an expert.)

**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications



Halsey Minor Battles Sotheby’s Again – artmarketblog.com

Halsey Minor Battles Sotheby’s Again – artmarketblog.com

In my previous post I made reference to a court case involving CNet founder Halsey Minor who sued Sotheby’s in 2008 for allegedly failing to fully declare when they had an ownership stake in works that they sold him. Sotheby’s won the case and were awarded $6.64 million in outstanding debts. I mentioned that I was not aware of whether Minor had appealed the decision – well, just after publishing this post, I received an email from Halsey Minor to inform me that he had in fact made an appeal on the 24th of November 2010.  Minor will be hoping for another positive outcome like the one he received when he sued Christie’s in December 2008 for waiting too long to return some of his art after failing to sell the works on his behalf, and not returning the works when they said they would.  Minor won the case against Christie’s and was awarded $8.5 million which was the calculated drop in value that the works in question experienced while in Christie’s possession. According to Minor in an email sent to myself: “in 8 hours a jury found Christie’s guilty of Fraud, Theft and Failure to Honor a Contract and awarded me $8.5 million”.

As the appeal against Sotheby’s is still being processed I cannot comment on the case, but I would like to revisit the case Minor won against Christie’s.   The reasoning behind Christie’s holding the paintings by Richard Prince that Minor had consigned to Christie’s, but had failed to sell, was that Minor owed Christie’s $12 million at the time for works that he had purchased through the auction house.  Christie’s essentially held the Prince paintings to ransom in the hope that they would be able to recoup some of the money that Minor owed them.  Unfortunately for Christie’s, this was not an ethical means of encouraging Minor to pay them what he owed, and was what essentially won the case for Minor.  Christie’s also had a $1.5 million breach of contract counterclaim for when Minor declined to pay for work that he had purchased at auction which Christie’s won.  Mind you, the win for Christie’s was no-where near as significant as Minor’s win.

At the end of the day one expects a reputable and highly respected business like a major auction house to act ethically, morally and legally at all times regardless of how their clients act.  Although I would never condone illegal or immoral action by a client of an auction house, considering the number of clients that the large auction houses deal with it is almost inevitable that some of them will not play by the rules.  A major auction house, on the other hand, should never be seen to conduct their business in a way that breaches ethical, moral or legal boundaries – yet there is plenty of evidence that they have.  What is even more disturbing is that the auction houses are so powerful that even the most discrediting mud seems not to stick.

To be continued……..

**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications

Do Art Auction Houses Camouflage Results? – artmarketblog.com

Do Art Auction Houses Camouflage Results? – artmarketblog.com

I received an email on December 2nd from one of Australia’s leading art auction houses, Menzies Art Brands, with the subject ‘Defamation Alleged’. The email read:

DEFAMATION ALLEGED

Menzies would like to bring to your attention this story on Page 10 of The Age newspaper today:

LEADING art auctioneer Rod Menzies has described as ”scurrilous” allegations made by Robert Le Tet and Rick Anderson about his business practices, in The Age yesterday.

Mr Menzies, an entrepreneur, cleaning business tycoon and owner of Menzies Art Brands, said he ”always honoured every deal” and was ”well known for carrying out every commitment and for his integrity”.

He said he observed the ”highest ethical standards” and denied suggestions to the contrary. He said in a statement that he had instructed his lawyers to start proceedings for defamation and damages claiming $38 million.

Enquiries
sydney@menziesartbrands.com

Before we continue, this is not the first time that allegations have been made regarding Menzies’ business practices. In 2008 complaints were made by other auction houses in Australia regarding Menzies’ alleged failure to adequately disclose details regarding guarantees provided by Menzies, as well as details regarding works being sold by Menzies that Menzies either owned or had a share in. Menzies denied the charges which were dropped in March of this year by the Australian Competition and Consumer Commission.

This time around, Menzies is being accused of misleading reporting of art sales through his auction house. The accusations were aired in the Melbourne, Australia based newspaper ‘The Age’ where details of a transaction involving a painting by Brett Whiteley, one of Australia’s most famous and valuable artists, were questioned. According to The Age, the painting in question was reported by Menzies Art Brands as having been sold in Sydney on the 25th of March for A$1.44 million. Apparently, however, only two months later Mr. Menzies was offering the painting in question for sale privately through his company for A$1.25 million, which suggests that it wasn’t sold at all. It is then alleged that Mr. Menzies struck a deal with a collector, named as a Mr. Anderson, to swap the Whiteley painting, and another painting, for two paintings owned by the collector. The swap apparently took place in June of this year.

If this allegation wasn’t enough, ‘The Age’ alleges further issues regarding ownership of the Whiteley painting. Apparently a Melbourne financier launched a court case to retrieve the Whiteley painting, which he claims he owns because his company, Questco Pty Ltd. , loaned money to an art dealer to purchase the Whiteley painting – a dealer who is now having financial difficulties. The Melbourne financier apparently then asked Menzies to sell the painting through private treaty for A$1.25 million, but Menzies reneged on the deal a short time later. Menzies is being accused of then returning the painting to the dealer, not the financier, and purchasing it off the dealer for A$850,000. Mr. Menzies then put the painting up for sale in March of this year, which is where this story began. Menzies sought to retrieve the painting from Mr. Anderson whom he sold the painting to by private treaty and apparently even offered several other paintings in exchange which had also been reported as having been sold at auction. Mr. Anderson has so far declined to return the painting.

According to the article in ‘The Age’:

Mr Anderson claimed Mr Menzies has been ”ramping” up the art auction market, and he said it was in the public interest to know how the prominent auctioneer operated: ”He reported the Whiteley painting as sold and then he offered it to me for $200,000 less than what it was supposedly sold for at auction,”.

No charges have been laid against Mr. Menzies or his company and, as you can see from the email I was sent, Mr. Menzies strongly denies the allegations made against him and his company. The question of who is telling the truth will presumably come to light if the defamation case goes ahead.

The reason that I have alerted you to this case is that I have been on a bit of an art auction house crusade of late in an attempt to inform the public about what goes on behind the scenes and hopefully encourage the art auction houses to be more transparent and ethical with their dealings. With transparency being one of the biggest issues, I thought it was important to highlight this case even though none of the allegations have been confirmed as being true.  I will be doing a series on this issue as there are lots of allegations to cover.

**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications

The Art Auction House Sin Files – artmarketblog.com

The Art Auction House Sin Files – artmarketblog.com

Where does it all end? When will people realise that although the questionable practices exhibited by some auction houses are legal, they should not be tolerated? How far will art auction houses be able to go before someone steps in and says ENOUGH IS ENOUGH !! Let’s take a look at the history of sins committed, and those allegedly committed, by the big three art auction houses.

The most famous art auction house scandal took place in 2000 when Christie’s and Sotheby’s were dragged through the mud because of allegations that they had formed a “cartel” and were agreeing in advance to fix commission rates. The price-fixing scheme violated federal antitrust law by eliminating competitive choice and cost customers millions of dollars. Christie’s dobbed on Sotheby’s and were given immunity from prosecution for their information. Sotheby’s ended up taking most of the flak with several senior members getting the boot and two senior managers, A. Alfred Taubman and Dede Brooks, both getting jail sentences. Sotheby’s, Christie’s and their owners also paid a civil lawsuit settlement of $512 million.

In September of 2004, Forbes magazine reported that Christie’s were allegedly withholding information regarding the authenticity of objects from clients. These allegations were made by Canadian newspaper heiress Taylor Lynne Thomson who went on to sue Christie’s. According to Forbes magazine: “Thomson sued and British courts ruled in May that Christie’s had been too lax in its catalog description, leaving out qualifications to its classification of the urns as being “Louis XV.” The judge highlighted the auction specialists’ decision to remove the qualifying words “possibly Italian,” which would’ve raised the possibility of the urns being far less valuable 19th-century copies.”

Christie’s controversial purchase of the highly regarded gallery Haunch of Venison in 2007 caused a flurry of opinions, many of called the sale a conflict of interest and accused Christie’s of blurring the lines between what galleries and auction houses offer. Christie’s wasn’t the first auction house to purchase a gallery though as Sothebys also made a foray into the gallery world by purchasing Noortman Master Paintings in 2006.

In 2008, CNet founder Halsey Minor sued Sotheby’s for allegedly failing to fully declare when they had an ownership stake in works that they were selling. Sotheby’s won the case and were awarded $6.64 million in outstanding debts. Minor can appeal but, as far as I know, has yet to do so.

In February of this year Christie’s allegedly settled with a brother and sister who sued Christie’s for allegedly failing to identify a painting that they consigned to the auction house as being by Titian. The painting was sold for £8,000 by Christie’s in 1993 as a painting ‘from the school of Titian’. It was determined after the painting had been sold by Christie’s that it was in fact a genuine Titian which was worth in the region of 4 million pounds. The siblings claimed that Christie’s failed to competently research and advise on the painting’s value when it was sold in 1993.

In May of this year (2010), Jeanne Marchig, a Swiss animal philanthropist, launched a law suit against Christie’s for failing to identify a painting owned by Marchig, which was sold by Christie’s for $19,500 in 1998, as a painting by Leonardo worth upwards of 100 million pounds. Christie’s sold the painting as a mere ‘19th century German’ work for which Marchig is suing Christie’s for ‘wilful refusal and failure to investigate the plaintiff’s believed attribution, to comply with its fiduciary obligations, negligence, breach of warrant to attribute the drawing correctly, and making false statements in connection with the auction and sale’. Christie’s disagrees with the claims that the painting is a Leonardo. Reaching an outcome with this case is likely to take quite a while.

The most recent art auction scandal involves auction house Phillips de Pury and their ‘Carte Blanche’ sale which took place on November the 8th (2010). So many issues have been raised in relation to this auction that it would take a series of posts to explain them all so I will only mention the most serious allegations. To begin with, the so called “curator” of the auction, Philippe Ségalot, not only was directly responsible for negotiating and organising the consignment of works for the sale, but he also advised some of the buyers – a situation that could be seen as a serious conflict of interest. If this wasn’t enough of a conflict of interest, Segalot is reported to have bid on works himself presumably on behalf of his clients. There have also been several reports that the auctioneer on the night, Simon de Pury, failed to make it clear to the audience when works failed to sell, which auctioneers are legally required to do. By failing to announce the failure of a work to sell the auctioneer could be seen to be attempting to deceive the audience by inducing a false sense of success and excitement.

These are only a few of the more serious scandals that have arisen as a result of some questionable tactics and practices adopted by the world’s top art auction houses. Are these the sort of businesses that you want to business with? Would you trust such a company to treat you fairly and honestly? I have made it my mission to make art collectors and investors more aware of what is happening in the art auction world and hopefully at the same time encourage the art auction houses to be more honest, ethical and transparent. Stay tuned, there is more to come………

**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications

Are Art Auction Houses Mocking Art Buyers? – artmarketblog.com

Are Art Auction Houses Mocking Art Buyers? – artmarketblog.com

A couple of posts ago I said that I have great respect for art auction houses – well, after the events of the last few weeks that respect is rapidly declining. If you have read my last few posts on contemporary art auctions then you will know that I have issues with the way some auction houses conduct their business. Unfortunately, over the last few days it has come to my attention that the problems that I identified are only the tip of the iceberg. Not only does there seem to be the potential for art auction buyers to be influenced by incorrectly categorised and catalogued works, but apparently some auction houses now appear to conducting auctions in a manner that suggests that art buyers are unable to make decisions for themselves when buying at auction, and need to be told what they should be buying. There are two recent events that have lead me to this opinion the first being the Phillips De Pury “Carte Blanche” auction, and the second being the recent Sotheby’s November contemporary art auction.  Before I begin I want to state that the following is purely my opinion and not in any way a statement of fact.

A comment by Alex Rotter, head of the Contemporary Art Department at Sotheby’s in New York, was the first indication I received that the extent to which auction houses are influencing what buyers purchase may have increased recently. Yes, auction houses have been influencing what art buyers purchase for many years, and as businesses are more than entitled to do so, but it seems that they have begun to exert an even stronger influence of late with the seemingly blatant tactics that have caused me to write this post. According to Rotter, commenting on the Sotheby’s November contemporary art auction, “The success of tonight’s sale was the result of editing – getting the right young, Pop and Abstract Expressionist material into the sale”. So, is this an indication that auction houses are doing something that I am sure many suspect they have been doing for some time – deliberately orchestrating sales to encourage potential buyers to pay more for works than they should, or purchase works that they didn’t originally intend to buy? Is Rotter suggesting that by including a certain array of works, and arranging the catalogue in a particular way, that the auction houses are able to influence buying behaviour? Or, is he suggesting that the contemporary art sales are so carefully planned to ensure that the auction consists of works that they know they have buyers for, that they auction house can guarantee themselves a successful sale before the sale has taken place? Or is the meaning of this comment something else entirely? I will leave the answers to these questions up to you for the mean time. Food for thought though……

Now for the “Carte Blanche” sale. Having a themed auction that allows buyers who are looking for something very specific to be offered a range of related objects is something that I have no problem with; Phillips often hold themed sales such as their music themed sales. I do, however, have issues with a blatant marketing tactic being masked as a cultural and curatorial exercise, which appears to be what has taken place with the Phillips De Pury “Carte Blanche” sale. Philippe Segalot, the so called “curator” of the sale, is quoted as saying in a Phillips De Pury press release that:

“I have always been interested in the concept of curated sales, where the artworks are selected not for their market value but for their artistic quality, historical importance and coherence within the group. Here, I tried to push this idea further by bringing together a small “collection” comprised of my favourite works by my favorite artists. The result is a true self-portrait, a close representation of my life as an art lover, an art collector and an art advisor.”

To begin with, I have a problem with the notion that such a wide range of Segalot’s favourite works from his favourite artists just happened to be available for sale at the right time. AmI really to believe that the owners of Segalot’s favourite works of art were for some reason willing to sell those works just because he asked nicely? Phillips De Pury mentioned in the same press release that I got the above quote from that “He (referring to Segalot) has developed the Carte Blanche sale with the same focus and attention to quality that a private collector would develop their own collection”. So, Segalot spent 50 years putting this sale together did he? Secondly, I have a problem with Segalot suggesting that the mechanics of the sale were not financially motivated – I mean why else would an auction house hold such a sale? It is not as though the sale had any art historical or cultural significance, yet Segalot seems to be suggesting that it does. Thirdly, and perhaps most importantly, I have a huge issue with Phillips De Pury suggesting, in my opinion, that buyers need someone like Segalot to tell them what they should be buying. Because the auction houses seem to be making such an effort to dictate buying trends, there is a huge risk of the works associated with these trends dropping in value significantly when the auction houses move onto promoting the next profitable trend. I believe that the more the decision of what to purchase is taken out of the hands of the collectors and investors, the less stable and sustainable the art market becomes. The reasoning behind this philosophy is that collectors (and even investors) create and strengthen long term trends whereas the market is interested in making as much money from whatever trend seems most profitable at the current time.

The reason that I have such a problem with the developing and strengthening trend of auction houses dictating what art people should be buying, and encouraging buyers to pay more than they should be paying for works of art, is that some time in the future the buyers who fell for this ploy will likely find out that they paid too much. What Phillips De Pury seem to be inferring with their “Carte Blanche” sale is that the works included in the sale somehow become more valuable or desirable because they were chosen by a well known and respected art world figure. And, judging by the success of the sale, plenty of buyers fell for the ploy. I just hope these buyers don’t expect to be able to recoup what they spent anytime soon.

There are even more issues with the “Carte Blanche” sale than the ones I have outlined, but those will have to wait for another post.

Disclaimer: Auction houses are well within their rights to conduct their business in the ways that I have discussed above.  I do not claim to have any proof that the auction houses are doing anything wrong, but am merely raising questions in the hope that they encourage discussion and dialogue.  The above post is purely my opinion and is in no way a statement of fact.

**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications

Fixing the Contemporary Art Auction Crisis Pt. 2 – artmarketblog.com

Fixing the Contemporary Art Auction Crisis Pt. 2 – artmarketblog.com

In my last post I detailed two definitions of contemporary art from two different contemporary art museums that challenge the rather inadequate and misleading definition of contemporary art that many auction houses seem to abide by.  Even though I had found two good museum definitions of contemporary art, I continued my search to see what else I could find.  And I am glad I did continue searching because I came across a particularly interesting definition of contemporary art provided by the Tate Museum.  According to the Tate, contemporary art is a:

“Term loosely used to denote art of the present day and of the relatively recent past, of an innovatory or avant-garde nature. In relation to contemporary art museums, the date of origin for the term contemporary art varies. The Institute of Contemporary Art in London, founded in 1947, champions art from that year onwards. Whereas The New Museum of Contemporary Art in New York chooses the later date of 1977. In the 1980s, Tate planned a Museum of Contemporary Art in which contemporary art was defined as art of the past ten years on a rolling basis”.

This definition is somewhat misleading because it lists the date range of two Contemporary art museums, the Institute of Contemporary Art in London and the The New Museum of Contemporary Art in New York, as though these museums define contemporary art by these date ranges.  What I found was that the beginning of the date range of works in the collections of both these museums is in fact the year that each museum was founded.  So, the Museum is not defining contemporary art as work produced from the year each museum was founded, but is in fact just maintaining a collection that is partly historical and archival even though their focus is on work that is new and experimental.  What interested me most about the Tate definition of Contemporary art is the revelation that “In the 1980s, Tate planned a Museum of Contemporary Art in which contemporary art was defined as art of the past ten years on a rolling basis”.  I personally think that this definition of contemporary art is the most accurate and sensible that I have come across and is the definition of contemporary art that the art auction houses should be abiding by.  Continuing with the museum definition theme, I think that the Getty museum provides one of the most blunt and profound definitions of contemporary art on their website which states that “Strictly speaking, the term “contemporary art” refers to art made and produced by artists living today”.  Here, Here !!!.

So, what does this mean for the art market, I hear you ask.  Well, let’s take a look at the results of a recent contemporary art auction held by an auction house that I will not be naming.  The reason I am not going to name the auction house is that there is not just one auction house on which one can lay total blame for this problem.  I also have great respect for the major auction houses regardless of whether or not there are issues relating to the classification and categorisation of works of art.  Looking at the top ten prices paid for this auction, which was promoted as a contemporary art auction, there were eight artists whose work was included in this top ten. The eight artists were Andy Warhol, Mark Rothko, Roy Lichtenstein, Francis Bacon, Gerhard Richter, Willem de Kooning, Robert Rauschenberg and Jean-Michel Basquiat.  Out of those eight artists, seven are dead – the only surviving artist out of the eight being Gerhard Richter.  Even more interesting are the dates that each of the top ten works were created:  1962, 1955, 1962, 1985, 1966, 1992, 1969, 1962, 1986 and 1987.  Six of the works were created prior to 1970, three prior to 1990 and only one after 1990.  The most recent work in the top ten was a work by Gerhard Richter, the only living artist in the top ten, which was created in 1992.  Of all the works in the top ten, the Richter would be the only one that I would consider referring to as a work of contemporary art – only at a stretch, mind you.

Although the top ten prices paid were dominated by the work of deceased artists, I must acknowledge that the auction did include works by true living contemporary practising artists.  Unfortunately the auction house uses the ridiculous misnomer ‘recent contemporary artists’ when referring to the work of the true contemporary artists.  By definition, something that is ‘contemporary’ is recent so to make reference to ‘recent contemporary artists’ is just plain wrong.  The fact that this term has to be used at all is, in my opinion, evidence enough that there is something amiss with the way some auction houses are cataloguing, categorising and presenting the works of art that they are selling.  If you don’t think that this is a big problem in the scheme of things then I respect that and even admit that you may be right.  But for me, this is the straw the broke the camel’s back; just another seemingly small problem that when added to the other seemingly small problems equal a rather big problem.  I do have some plans to combat all these small problems but you will have to wait to find out what my plans are.

image: ‘The Art Crisis’ by Robert The

**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications

Fixing the Contemporary Art Auction Crisis Pt. 1 – artmarketblog.com

Fixing the Contemporary Art Auction Crisis Pt. 1 – artmarketblog.com

So, my last post on the issues surrounding the definition of contemporary art and the classification of works of art by auction houses created quite a storm – and rightly so. If you are still wondering why I have such an issue with the way some auctions houses categorise the works they are selling, then perhaps what I am about to show you will provide some enlightenment. The definition of contemporary art, in the context of the art market, has seemingly become redundant due to years of misuse and abuse. Although I acknowledge that the definition of contemporary art has remained open to interpretation to some extent, some auction houses appear to be taking liberties when it comes to categorising works for auction. Since the art market appears to function according to a corrupted definition of contemporary art, I decided to turn to cultural sector to see what the museum world had to say on the subject.

When it comes to making decisions regarding the classification and categorisation of works of art it is the cultural sector that generally has the final word, so I was hoping the cultural sector would provide something insightful. What I found was insightful indeed. To begin my search I went to the website of the Museum of Contemporary Art, which is located in my home town of Sydney, Australia, and is a favourite haunt of mine. The Sydney MCA website says: “Contemporary art can be defined in several ways: art which is of this time; art which is recent, new or existing now; or art which follows modern ideas or fashions in style and design. It can also refer to museum collections from 1970s onwards”. So, the Sydney MCA defines Contemporary art as both recent and as an era that began in the 1970’s. The next museum definition I found was provided by the Madison Museum of Contemporary Art whose website said: “Contemporary art had its beginnings in the early 1970s, resulting in part from a general challenge to the authority of state and cultural institutions dominated by men and exclusivist policies. Contemporary art, also identified with the term postmodernist art, has been in many ways a continuation of the ideals of modern art—its themes, styles, and, most importantly, the concept of the work of art as private expression”. Again, the MMOCA defines contemporary art as a sort of era that began in the 1970’s.

Now, before I continue on I want to make it clear that I am not agreeing with the above definitions of Contemporary art provided by the museums. I do, however, acknowledge that a museum devoted to contemporary art requires a relatively broad definition of contemporary art due to the fact that a museum’s collection needs to have a relatively long shelf life. If a contemporary art museum were to focus purely on current art, they would have to constantly update the collection, which would be an extremely expensive and time consuming task. At the present time I can understand the reasoning behind the decision by Contemporary art museums to begin what could be termed the “Contemporary era” in the 1970’s, as both Conceptual art and Digital art – both of which continue to have a strong influence on current artistic practice – came to prominence in the early 1970’s.

To be continued………….

image: ‘4 the Love of Go(l)d’ sculpture by Eugenio Merino

**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications

The Great Contemporary Art Market Cock-Up – artmarketblog.com

The Great Contemporary Art Market Cock-Up – artmarketblog.com

All last week I was bombarded with headlines that announced the returning strength of the contemporary art market thanks to the phenomenal prices achieved for works by artists such as Warhol, Lichtenstein and Klein whose work was described by one major newspaper as the fons et origo (latin for source and origin) of contemporary art. Now I am not trying to be rude or degrade the journalists who make this mistake, but Warhol, Klein (Yves) and Lichtenstein are NOT CONTEMPORARY ARTISTS, and their work is NOT CONTEMPORARY ART !!. To be honest, I am sick of hearing and seeing artists of another era being referred to as ‘contemporary’, because they are not. The fact that Warhol, Klein and Lichtenstein are all dead – and were all born in the 1920’s – should be enough of an indication that their work should not be classified as contemporary any more. As for myself, when I refer to the work of contemporary artists I am referring to artists who are currently alive, active and producing work that is in line with the prevailing contemporary ethos. At this point I would like to say that there are many journalists and market representatives who do make the correct distinctions between post-war and contemporary art to whom I would like to give a round of applause.

The reason this trend of referring to the likes of Warhol, Lichtenstein and Klein as contemporary artists annoys me so much is because many representatives from the media and the market have been announcing the return of the contemporary art market based on records achieved by artists who are NOT contemporary artists. Thankfully, some market representatives and some journalists have rightly referred to the work of Warhol, Lichtenstein, Klein etc. as postmodern or post-war, which is a much more accurate description. I do, however, also have a problem with the use of the term post-war because of the broadness of the category which I think is another marketing ploy – but would still prefer they use the term ‘post-war’ instead of ‘contemporary’. Although this may seem like a small problem not worthy of being discussed, I think there are too many little issues that are not discussed – issues that together can cause major confusion and misunderstanding.

This whole ploy of including anything produced post world war II in contemporary art auctions and referring to them as works of contemporary art is just not right. In fact, it is deceptive and misleading. So why do some auction houses continue promoting the likes of Warhol, Klein and Lichtenstein as contemporary artists and alongside true contemporary artists? – I believe it is for three very simple yet potentially very lucrative reasons. Firstly, the association of emerging artist with the likes of Warhol, Klein and Lichtenstein lends more credibility and validity to the work of emerging artists. Secondly, the inclusion of a few big names in a contemporary art auction pretty much guarantees that a poor performance by the work of the true contemporary artists will be overshadowed by the success of the work of their predecessors. Thirdly, artists such as Klein, Warhol and Lichtenstein attract large and wealthy crowds who are more likely to throw down some money on the work of an emerging artist if the room is already buzzing from the record sale of a Warhol. Essentially, the inclusion of work by Modern masters such as Warhol, Klein and Lichtenstein appears to be nothing more than a clever marketing ploy.

If you disagree with my opinion then consider for a moment these definitions of the term ‘contemporary’ :

-marked by characteristics of the present period
-happening, existing, living, or coming into being during the same period of time
-belonging to the present time
-characteristic of the present; “contemporary trends in design”

As far as I am concerned, each of these definitions are blatant indications that the work of Warhol, Klein and Lichtenstein cannot be referred to as being contemporary.

The current definition of contemporary art that is used by a large portion of the art market – auction houses in particular – is basically a creation of the market it’s self that serves the pursuits of the auction houses very well. Although the journalists appear to be the main protagonists when it comes to promoting the work of non-contemporary artists as contemporary, the auction houses certainly don’t seem to do anything to discourage this practice. Although some auction houses do hold auctions that are promoted as including post-war and contemporary art, many fail to make much of an effort to distinguish between the contemporary and the post-war, which leaves the journalists free to make the incorrect assumptions and associations regarding the classification of the works – perhaps a cunning ploy by the auction houses to avoid being accused of incorrectly classifying the works. Regardless of who it is that is ultimately responsible for the errors being made, I think it is important that something be done to stop this misleading practice. In the interest of fairness I would like to encourage anyone who has a view on this issue – whether in agreement with my opinion or not – to make a comment below.

 

**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications

A New Sentimental Art Market Era Pt. 4 -artmarketblog.com

A New Sentimental Art Market Era Pt. 4 -artmarketblog.com

It has been said before that nostalgia prospers during recessionary times so, considering that the western world has just begun to recover from a major recessionary period, it would make sense that the art market is trending towards a focus on the nostalgic and sentimental.  The length of time that this era of sentimentality and nostalgia will last is anyone’s guess, but given that the boom lasted longer than most expected, the recovery time for the contemporary sector of the market could be just as long – except that it probably won’t be.  It would be nice to be able to report that the saying ‘Once Bitten, Twice Shy’ applies to the contemporary art market but, unfortunately, there are signs that the next puppets are already being groomed in preparation for the next inevitable contemporary cozenage.  The only question is how long it will take for the art market to once again become hypnotised by the glitz and glamour of the consumerist contemporary art regime.  In the mean time, it is great to see a level of intimacy, passion and involvement being brought back into the market that was conspicuously absent during the contemporary driven boom.

According to an article titled ‘Investors renew passion for modern masters’ ,which appeared in the Guardian newspaper, “When an alluring seated nude, La Belle Romaine, broke all records for a painting by the Italian artist Modigliani on Tuesday – selling for $69m (£42.7m) at auction in New York – the extraordinary price tag marked a historic moment in the art market. It shows that investors are turning back to the relative certainties of the modern masters and away from more risky contemporary art”.  This statement confirms that buyers are taking a much more cautious approach to the art market by buying works that they are more familiar with and have some sort of affinity with – a key characteristic of a sentimental art market era.  The care and thought that buyers are exhibiting when making purchases shows that they are seeking a much more intimate and passionate connection with the works of art that they are purchasing which is a trend that one would expect to see during a sentimental art market era.  Another key characteristic of this sentimental art market era is a sort of nationalistic sentimentalism that is likely to emerge as disillusioned collectors and investors who experienced the contemporary art market correction seek more genuine and justifiable reasons for purchasing works of art – reasons that provide a more fulfilling, intimate and involved art collecting experience as opposed to the cold and calculated commercialism that characterised the contemporary art market boom. Nationalistic sentimentalism can be defined as the purchase of works of art from one’s own country out of a sense of pride and sentimentality.

Both these characteristics allude to a market that is seeking a more intimate and involved connection with the works of art they are collecting or investing in.  I would expect that this trend will continue to develop throughout 2011 as the global art market attempts to heal the wounds that the emerging contemporary art market bubble inflicted.  This will be the last post on this topic for the time being unless any further corroborating indicators come to light.

**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications

A New Sentimental Art Market Era Pt. 3 – artmarketblog.com

A New Sentimental Art Market Era Pt. 3 – artmarketblog.com

If you want some further examples of the sentimental and nostalgic direction that the art market is beginning to take then I shall provide you with two more. The first example is the direction that the Australian Aboriginal art market has taken recently in response to a severe drop in prices and a major change in perception caused by several factors that I will discuss shortly. Australian Aboriginal art experienced a huge boom roughly in conjunction with the global contemporary art market boom, which saw prices for Australian Aboriginal art skyrocket, and the market for said works expand at a rapid rate. Unfortunately, that boom turned to a spectacular bust for much the same reasons and at roughly the same time that the global contemporary art market took a massive hit.

Much like the global contemporary art market, the Australian Aboriginal art market boom saturated the market with a plethora of rubbish, which in turn diluted the overall quality and relevance of the works of Australian Aboriginal art that were available on the market. Although it may seem that such a situation would serve to increase the value and desirability of the top quality works, it is just as likely (if not more likely) to make people question the value of the entire market and become rather disillusioned with the whole sector or genre – which is exactly what happened. Rampant fakery, forgery and mimicry, combined with obstructive and useless attempts at regulating the Australian Aboriginal art market, caused collectors and investors to fly the white flag of defeat in the face of seemingly insurmountable obstructions. As an indication of how far the Aboriginal art market has fallen as result of the problems associated with the market, the Australian Art Sales Digest has calculated that the value of Aboriginal art put up for auction has fallen from a high of just under $24 million in 2007 to just under $11 million in 2009. 2010 is shaping up to be yet another disappointing year for Australian Aboriginal art with total auction offerings likely to be even less than last 2009.

In response to the rather dire situation that the Australian Aboriginal art market is facing, the market and cultural sector has begun to focus on the Aboriginal master artists of the past who were the real reason that Aboriginal art became so popular. With most art movements and styles there are a small group of artists who pioneer the movement/style and whose work is considered to be the most legitimate and authentic. As a new movement/style progresses it is inevitable that other artists will begin to imitate the characteristics of the work of the pioneering artists in the hope of reproducing their success. In conjunction with the progression of that movement/style there is a tendency for the original purpose and intent of that movement/style to become severely diluted as more and more artists join the procession. The further the movement/style progresses, the more disconnected the movement/style becomes from the original purpose and intention. This is what happened with the Aboriginal art market and also with the global contemporary art market. Fixing such a problem means regaining the integrity, legitimacy and validity that the movement /style once had. To regain the integrity and legitimacy of the beginnings of a movement/style one must return to the roots of that movement/style – a process that is happening with the Australian Aboriginal art market and the global contemporary art market. Australian Aboriginal art dealers and other interested parties have begun to “rediscover ” the work of the early pioneers and disassociate themselves with the work of the plethora of imitators. Because most of the original Aboriginal master artists are either dead or very elderly so focussing on this sector of the market is a very sentimental affair indeed – especially for the families of the deceased artists.

The other example I want to use is the recent reconnection that the French have made with Monet – one of their most famous sons. Although the western world has embraced Monet and made him one of the most valued and respected artists to have ever laid paint to canvas, the French have long considered his work to be far too commercial for their sophisticated tastes. The Paris’ Galleries Nationales recently launched the first retrospective of Monet’s work since 1980 in the hope of reviving interest in the work of one of the world’s most highly valued artists. What makes this exhibition so significant is the reasoning behind the decision to hold this exhibition at this particular time. Guy Cogeval was appointed to the Presidency of the Musee d’Orsay in 2008 and is the curator of the Monet exhibition which is currently on show at the Grand Palais in Paris. When Cogeval was asked by Juliette Soulez of ARTINFO France (fr.artinfo.com): Why have a Claude Monet retrospective today?, Cogeval replied “Fifteen years ago, I personally felt that everything had been said about Monet and that people talked about him too much. I lived in North America for eight years and there were many Monet shows — it was almost a craze”. Then when asked if he was happy with the retrospective, Cogeval said “Overwhelmingly, visitors walking through this exhibition — including Impressionist specialists and college professors and my fellow curators — feel that they’re seeing a Monet they didn’t know before”. Both these statements suggest to me that a similar thing happened to Monet to what happened to the Australian Aboriginal art market and the global contemporary art market. It seems that a long period of western commercialisation of Monet’s work combined with what was essentially an overabundance of Monet focused scholarship effected a gradual diversion away from the “real” Monet.

The French, who were on the outside looking in, obviously cottoned on to what was happening to people’s perception of Monet’s work and were quite rightly disgusted by what was happening. I recently read a review of a book called The Unknown Monet: Pastels and Drawings by Grace Seiberling of the University of Rochester who I think summed up the situation perfectly when she said about the book that: “Their focus on Monet as an artistic genius is in accord with the demands of a particular kind of inquiry into Impressionism, connected with museum exhibitions, and focused on the formal achievements of the sort of artistic superstars who attract paying visitors”. What Guy Cogeval is doing is taking a sentimental and nostalgic approach to Monet’s work in the hope that it will fix the damage that has been done.

**Nicholas Forrest is an art market analyst, art critic and journalist based in Sydney, Australia. He is the founder of http://www.artmarketblog.com, writes the art column for the magazine Antiques and Collectibles for Pleasure and Profit and contributes to many other publications