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The Supermodel and the Brillo Box
The backstories of contemporary art
The 'Stephanie' of the title is known in art world as 'Trophy Wife'. It is a nude waxwork of supermodel Stephanie Seymour, commissioned by her husband, billionaire Peter Brandt. (He owns the biggest newsprint company in US and publishes Art in America magazine.) His library features trophies of gazelle and buffalo shot on African hunting safaris. The sculpture makes her look like another one of the mounted hunting trophies. It has waist length hair, intended to be styled by the owner.
It is the work of Maurizio Cattelan, but he just provided the concept - the actual construction was done by a French tech who made mannequins for wax museums.
The operative part of the word contemporary, is 'temporary'. Half the galleries advertising in a 15-year-old copy of Artforum are no longer around. Three quarters of the artists featured are no longer represented by a mainstream gallery. Of the thousand artists who had serious gallery shows in New York or London in the 1990's, just 25 were offered at an evening auction at Christie's or Southerby's in 2013. Half the work purchased at auction in 2013 will never resell at hammer price.
Why are some paintings bought for prices way out of kilter with the rest? Mostly it's competition amongst the very rich and new art museums competing for a few 'iconic' works of art. Iconic here means in the style that is typical of the artist's work - Monet's water lilies or Pollock's drips or Damien Hirst's spots.
People display their most expensive artworks in the living room, where it serves as a signal of the owner's wealth and taste. less expensive stuff goes in bedroom, for private consumption.
Some artists become brands, and no-one questions what they put forward as art. No-one dismisses "That abstract is by Roy Lichtenstein" (which is invariably followed by) "for which I paid $35 million at Christie's."
Importance of a 'back story' illustrated by Warhols' Brillo Boxes of book title. The original boxes were designed for Brillo by commercial artist named James Harvey. His boxes were valueless, but when Warhol presented them as art, they sold (at a 2012 Southerby's auction, for $772,500).
But the back story for these boxes is complex. A museum curator named Pontus Hulten claimed that Warhol authorized the production of 100 Brillo boxes for an exhibition in Stockholm in 1968, and gave him a cardboard box template to use. Fifteen wooden Brillo boxes were painted and silk-screened in Sweden, before curator realized they would not have enough time to produe the rest. So he ordered 500 cardboard boxes from the Brillo factory in New York. Another 105 wooden boxes were produced for Hulten for a 1990 Pop Art exhibition in Russia, and then at a 1992 exhibition in Bonn. Hulten said that Warhol had authorized the extension of the series.
These boxes were later sold in sets, with a set of 22 going for $1.2 million in 2004. It later transpired that it was only the cardboard boxes which had been shown at Stockholm (which was the only exhibition specifically authorized by Warhol.) They would have been valuable, but had been thrown away after the show. None of the wooden boxes were produced by Warhol, nor had he even seen them. So how authentic are they?
The difference a back story makes can be huge. It is well understood in the art world that technicians produce Damien Hirst's art. Hirst says that "the best spot painting you can have by me is one painted by Rachel (Howard)." In 2008 Rachel Howard sold a spot painting for $90,000 at an auction in NY. A few months later, another spot painting by her, but with an (indistinct) Damien Hirst signature, sold for $2.25 million.
In 1962 Jackie Kennedy charmed the French PM into loaning the Mona Lisa to the NY Metropolitan Museum. French gallery officials were horrified because of the fragility of the painting and the risk of it being stolen. It turns out that the Louvre owns a wonderful copy of the ML, identically framed. It was suggested that they simply send the replica to NY, but the French feared the story would leak, and would poison US/French relations. A million people queued for up to two hours to look at it - would they have been unhappy if they found out later that they'd seen a copy?
Charles Saatchi has an internet site Saatchi Online which allows anyone to post pics of their art. takes a 30% commission on any sales. Shows 50,000 artists and averages 800 sales a day.
Collectors Herb and Dorothy Vogel. He was a mail sorter in PO, she was a librarian. No kids, no car, lived in a rent-controlled apartment in NY. They lived off her income and spent his buying paintings, preferably things they could carry home
on the subway. In 30 years they amassed collection of 4500 artworks. They got rid of most of their furniture to have room to store it. It was worth millions, but in 1992 they gave the whole lot to the Washington National Gallery. To thank them, the gallery gave them a small annuity. They used it to start collecting again.
Is contemporary art a good investment? Short answer: "No". Long answer "No No No". Full answer: It is high-risk, illiquid, fad-and-fashion driven. It has high transaction, storage and insurance costs. And there is always the issue of authenticity.
Headlines are always about the eye-catching price-inflation of a few works, never the many which decline in price. And the assertion "No work of art purchased for more than $30 million has ever been resold for a profit."
Some real piss-takers: Maurizio Catteltan, the Italian who produced Stephanie, and who said he went into art making because he noticed that all the beautiful women were attracted to artists, once decided to make 'theft' the theme of a show. He copied all the works of artist in gallery next door (including the press release), and offered it all at a higher price.
2008 Damien Hirst bypassed his dealers to auction 223 artworks specially made for the event. Sotherby's produced a 3 volume catalog, which you could buy, if you weren't on the VIP list, for £90. 216 of the 223 lots sold at auction for £111 million. Sotherby's had waived their consignor's commission, so Hirst got 100% of the hammer price. (But reputedly 20% of the bidders defaulted, refusing to go through with the purchase. There is no indication that any legal action was taken against them).
The most widely collected American painter is Thomas Kinkade, who was one of the wealthiest painters in America when he died in 2012 at age of 54. He painted pastel cottages with flowerbeds, nestling in quaint villages. He infuriated art critics, who branded his work kitsch - even though nobody can tell you exactly what that is, and where the line is drawn. Damien Hirst famously said "I produce pure kitsch, but I can get away with that stuff because I am considered a high artist."
Kinkade got rich not by selling paintings but by selling reproductions.But Warhol and Hirst each sold multiples produced by assistants. From the art world's POV the main difference is that his work was never sold through an established gallery.
The most popular UK artist in terms of numbers of sales is Jack Vettriano, the painter of The Singing Butler (a couple dancing on the beach with butler and maid holding umbrellas for them), the original of which made £3/4 million at Sotherby's in 2004. But the critics don't like him, either. "The Jeffrey Archer of contemporary art."
Third example of outsider art disdained by the art world snobs is Banksy. He claims anonymity, and though a 2008 Daily mail story published his name and photo, it's never been repeated, because his fans don't want to know.
Banksy may be one of the world's most successful artists, but he doesn't feature on the art world's list of "noted contemporary artists. "It's not clear why Cattelan makes the list and Banksy does not."
Intense competition between Christie's and Sotherby's, with the minnows, such as Phillips, pushing in where they can, usually by offering better deals. In 2010, Phillips auctioned 22 works from a Merrill Lynch collection. They offered ML 108% of the hammer price - ie they not only gave away their consignor's premium, but also 2/3 of the buyer's premium of 12%. Phillips' commission on the $19.5 million sale would not have covered catalog and promo costs. They did it purely for the 'prestige' of arranging the event.
Charles Saatchi, discussing Larry Gagosian: "New collectors, some of whom have become billionaires many times over through their business nous, are reduced to jabbering gratitude by their art dealer, who can help them appear refined, tasteful and hip, suurounded by their achingly cool masterpieces. Gagosian is the most dominant art dealer in history, no matter what measure you use. His global empire comprises 13 galleries: 3 each in NY and London, 2 in Paris and 1 each in Los Angeles, Rome, Geneva, Athens and Hong Kong. They sell over a billion dollars worth of art every year. Represenatation by Gagosian boosts an artist's prices, particularly for younger artists.
If you are a new collector, the top galleries will not sell you a top level painting unless you are a celebrity or a recognized member of the 1%. You will have to 'qualify' by buying lesser works until you have proven to be a serious collector rather than a speculator who may need or want to flip a painting.
Price decides value rather than reflecting it. The Veblen Effect - buyer satisfaction comes not just from the art itself, but from the conspicuous price paid for it. If the buy price includes a (secret) discount, buyer satisfaction is even higher.
Auction houses have huge databases of who wants what. Cameras record all auction sales and they know the bidders by the paddle registration. Public sales can be a disadvantage because dealers or collectors with an inventory of an artist will not want to see large scale disposals.
New art museums in Arab oil states. Abu Dhabhi's annual art acquisition budget exceeds that of the top 25 US museums combined. But the Qatar museum budget, if it even has a limit, seems to exceed even that. In 2011 the collection of Greek George Embiricos was sold off. The most important painting was one of Cezanne's Card Players. Larry Gagosian and William Acquavella each made unsolicited offers over $220 million. Qatar then bid $250 million, take it or leave it, no soliciting other bids. The Embiricos family took it.
Museums are typically built on the peak of a pyramid. Beneath that is usually a community of artists, art schools, curators and galleries, with a group of collectors above them. But Abu Dhabhi, Dubai and Qatar are each constructing an upside-down pyramid. Museums are a Western invention, and the Arab world has no tradition of painting. They have few galleries, artists or collectors. The museums will come first.
Chinese auctions are very opaque, and practices which would be regarded with suspicion in the West are routine. Artists may be accepted only if they can produce a guaranteed bidder. Dealers often use shills to bid up the price of an artist, and then offer collectors a huge discount off the auction record price.
Art fairs were originally established by dealers trying to resist the encroachment of auction houses on their turf. But the cost can be daunting. An average sized booth can cost over $50,000 + setup costs + flight and accommodation. marketing can easily cost $100,000. And all these are upfront costs: if there are 4 art fairs close together, a dealer could easily have half a million dollars invested before he gets anything back. Even then, some dealers are excluded because they can't bring enough high quality art.
Miami Basel is held in first week of December. In 2012 51,000 people visited, 5000 of them with some sort of VIP pass from the various sponsors and galleries. Less than 2000 of them bought any art.
Miami is the only fair to feature a category called "Self-loathing neon art". One exhibit was a work spelling out We're all here because we are too afraid to deal with problems in our real lives.
Miami Basel accepts 265 galleries from 800 applicants. The rest show at converted warehouses etc. Dealers come to the satellite shows not necessarily to sell, but to be able to say "We showed at Miami."
Collectors are attracted to fairs because they combine socializing with convenience - purchase, network and party in one location. And works for dealers because creates a "I better buy this now or I might miss out mentality". The number of 'SOLD' stickers reassures collectors that they are getting good value. When a buyer doesn't have enough information to make a reasoned decision, reassurance comes from the behaviour of others.
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