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The Resilience of the Art Market

Thursday, February 2nd, 2012

Artprice recorded that last year, 2011, was the best ever for the sales of art at auction. With 10.7 billion dollars in earnings for 2011, artists such as Picasso, Degas, Zhang, and Warhol helped make 2011 a stand our year for art. When compared to 2010’s total of 9.5 billion dollars, it is easy to see the confidence and staying power of the art market as a veritable asset in this economy that cannot be ignored.

Picasso's "La Lecture" Sold for $40.5 million

This is due to several factors that the Art Newspaper and Artprice have been discussing for quite some time. In their January 2012 edition, the Art Newspaper explains that the art market is not a single entity but smaller markets that are combined under one name which means that the profits for 2011 do not even include the private sales in galleries or between individuals thereby making the revenue gains even more substantial. The profits were derived from the driving demand for what the Newspaper described as new buyers liking the “branded nature of contemporary art”, mixed with the demand for fresh and correctly estimated property.

Zhang Xiaogang’s “Forever Lasting Love (Triptych)” -sold for $10.2 million

Zhang Xiaogang’s “Forever Lasting Love (Triptych)” Sold for $10.2 million

Art Price’s Art Market Insight features two article’s titled “2011 from the AMCI’s viewpoint” and “The global art market – an overview of 2011”. These articles reiterate that the art market confidence is at an all-time high, but with a focus on the international factors that lead, and continue to led to, the market’s success. The financial markets closed the year 1% down while the art market posted a 15% increase in revenue. The first part of 2011 saw lots of new records being set with over 6.3 billion dollars in revenue between January and June alone. This was aided by revenue coming in from China, which became the world’s leading fine art marketplace in 2011 (China alone accounted for 36% of the global art market).

Unfortunately with the European debt crisis, the art market fluctuated from July to August. However with the success of international art fairs and the late Contemporary art auctions, buyers were certainly more than optimistic about the value of their investments and continue to be. Going into 2012 the art market doesn’t seem to be worried as China maintains its hold, and Modern and Contemporary art are as popular as ever. So when buying a work of art in this economy you should feel confident, because there’s nowhere to go but up.

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The Value of Henry Moore

Thursday, December 15th, 2011

Moore Working

Henry Moore is one of the most iconographic artists of the 20th century. His works in sculpture, bronze, Rosenthal Porcelain, and on paper are well known for the fluidity of line work that is abstract and detailed. His works effortlessly draw out the viewer’s feelings of compassion, interest, and wonder and thus it is not difficult to see why his works have increased in value.

The 20th Century British and Irish Art sale at Bonham’s in November broke the world auction record for a work on paper by Henry Moore. A 1941 drawing of a seated mother and child sold for $989,286. In addition, a 1939 bronze sculpture by Henry Moore, Stringed Reclining Figure, was also sold at this auction for $441,544.

Stringed Reclining Figure, 1939

As discerned from Art Price, the turnover value for works by Henry Moore in public auctions was over $33 million in 2010, with a 24% increase in value since 1998. The popularity of his mediums, such as bronze sculpture, Rosenthal Porcelain, and drawings vary depending on the iconography and price. However as the artist evaluation and recent auction listings indicate, the investment of owning a work by Henry Moore appears to be a wise decision.

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What Will Happen to Warhol?

Friday, December 2nd, 2011

Andy Warhol

The Andy Warhol Foundation has developed a rather convoluted reputation in their quest to catalog and certify the vast collection of over 100,000 (across all media) works that Warhol created. The Foundation Board has made several controversial decisions regarding the authentication of specific prints and screen prints that have landed them with millions of dollars’ worth of legal bills and a negative reputation as the monopolizing entity of the Warhol market. However a collector may feel about their role in the art market, they play an important one. In an interesting turn of events this past month, the Andy Warhol Foundation announced that it will dissolve its authentication board at the beginning of 2012.

Wahol- Blackglama

What does this mean for the collector? Will panic spread through the art market as Warhol’s go unregulated? That does not seem to be the case as the Art Newspaper brilliantly discusses in The problem with authenticating Warhol.  In the article they note the facts” that none of the top five Warhol works sold at auction have been stamped by the board…”. With only 16 out of 49 works for sale this past month having been authenticated by the board, there is no reason for collectors to fear.

All of the top record-breakers are, however, detailed in the artist’s catalogue raisonné that the Warhol Foundation has compiled. There are three completed volumes of the catalogue that document Warhol’s paintings, prints, screen prints, and sculpture until 1974. The foundation’s mission is to make a complete catalogue of all of Warhol’s works and will continue to review works submitted for inclusion in future editions, but in its own time (unlike the authentication board, which took requests).

The Foundation stepping away from the market to focus on scholarship will undoubtedly led to good things. A more complete catalog of Warhol’s work will aid the art market in regards to authenticity as the new scholarship will include his drawings and photographs, which currently do not exist in a cohesive form. When looking at the Warhol works the Authentication Board has been exposed to, there is no cause for concern as only 6,000 of Warhol’s more than 100,000 works have gone through the authentication process. Thus the only advice to offer a collector is to practice due diligence in regards to researching the provenance of a piece and feel 100% comfortable and confident in their purchase.

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Art Market Update

Monday, November 7th, 2011

Sotheby’s and Christie’s Impressionist and Modern sales this past week provided for an interesting revitalization of the Impressionist and Modern art market. Christie’s tallied $149,773,500, while Sotheby’s tallied $199,804,500 in sales which are remarkable when compared to previous Impressionist and Modern sales. Both sales offered a variety of different works, but as an Artinfo article pointed out, the provenance and rarity of the items in the Sotheby’s sales were not to be passed up.

There were several insights that were revealed in these sales as to the direction of the art market. The first of which is that Surrealism is gaining popularity once more. Max Ernst’s incredible masterpiece, “The Stolen Mirror,” sold for a record $16,322,500. While two classic works by René Magritte also found homes with “La fin du mond,” making $7,026,500, and the painting “Les vacances de hegel,” making $10,162,500. Surrealism is an interesting theme as it attempts to express the workings of the subconscious through fantastic imagery and strange juxtapositions of subject matter, which not everyone appreciates but the works do have quite the solidarity in the art market.

La femme qui pleure, I

La femme qui pleure, I by Pablo Picasso


Meanwhile others insights emerged, and that was the continuing market power of Pablo Picasso prints.  His famed 1937 etching, “La femme qui pleure, I,” sold for $5,122,500 at Christie’s, a record for a single print at auction. Etchings are known to have a high resale value due to the artist’s involvement in their creation and the method employed to create them. Reproduced prints in particular have become steadily incorporated into artists’ original prints and are therefore not solely produced, as originally intended, for mass production therefore the value is still there as can be seen in the sale of this Picasso.

Several of our other artists that we feature had great sales as well. Pierre-Auguste Renoir’s “Portrait en buste de jeune fille” went for $1,874,500, and Wassily Kandinsky’s color-charged 1908 Expressionist composition “Weisser Klang (White Sound)” sold for $8,930,500. These all seem to affirm, when taken in accordance to the auction results of the past few years, that art is a good place to put some of your wealth as it has proven to be a resilient market. The confidence in the art market can only continue to rise as additional Contemporary auctions occur this week.

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Watermarks and Rembrandts

Tuesday, August 16th, 2011

When Masterworks Fine Art acquires an artwork, we undertake a program of research and identification. Old Masters prints, such as those by Rembrandt, require special attention because documentation can be limited, works often exist in multiple states, and posthumous prints made from plates still in existence are on the market.

When researching a Rembrandt impression, we consider the image and sheet size, the type of paper on which the work is printed, and the watermark (if there is one). We consult Nowell-Eusticke, the authoritative catalogue raisonné for the artist, compare our results against the volumes by Hind and White & Boon, and turn to the recently-published Watermarks in Rembrandt’s Prints by Ash & Fletcher. These books describe, in one way or another, differences large and small between each printing of a single plate.

Rembrandt experimented with the effects of printing on different kinds of paper, and is known to have used vellum, calfskin parchment, creamy handmade European papers, coarse “oatmeal” papers made from the dregs of the papermaking vat, and the thicker, softer “Japan” paper (Ash & Fletcher, 11).  Not all of these papers were made with watermarks or wire marks, as they are also known, but those that were can provide insight into the time frame in which a print was pulled.

As methodical studies of watermarks found in the graphic work of specific artists appear, the identification of these marks becomes increasingly valuable. It is a rare day when we uncover a full watermark on a newly acquired print. Finding even the tip of a crown or a partial cluster of grapes enables us to match that fragment to a documented watermark. If we can nail down what paper the work is on, we can at least be certain that the impression was not pulled before a certain date.

How does this relate to Rembrandt?

Say we determine that a certain watermark was produced in the early 18th century. A Rembrandt etching on that particular paper couldn’t possibly be a lifetime impression, given the artist’s death in 1669. Ash and Fletcher note: “Our research often revealed the use of the same paper in the same print or in prints produced within a few years of each other” (15). That being said, they continue, “Rembrandt may have purchased certain papers in quantity, saved them, and used them intermittently over the years” (Ibid). This passage underscores the difficulty Rembrandt scholars face in assigning prints an exact date. Though helpful, a paper’s dates of creation do not necessarily dictate the time frame for the printing of a specific state. A plate may have been etched one year and printed the next. It may also have been reprinted a decade later.

Information obtained through a watermark about a paper’s country of origin, dates of manufacture, and import history can narrow the time frame for an impression and authenticate the work. However, sometimes our search for a wire mark leaves us empty-handed, and we turn to determining the state of the print.

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Rembrandt: What a State

Thursday, August 11th, 2011

More than 15 studies of Rembrandt’s prints have been done since Parisian art dealer Edmé-François Gersaint compiled the first portfolio of the artist’s work in 1751, a number that underscores the challenge that his oeuvre continues to pose (White & Boon, v). These books provide essential information about each print; cross-referenced catalogue raisonné numbers identify each image, and a brief, meticulous discussion of the impressions and states in existence follows.

We look to Nowell-Usticke’s authoritative Rembrandt’s Etchings: States and Values before cross-checking the entries in catalogues by White & Boon and Hind, amongst others. Nowell-Usticke makes the following remark in his introduction:

“A great multiplicity of states seems to have always been associated with
Rembrandt’s etched work. I feel this idea is incorrect. Rembrandt was
basically a one state etcher. […] after completing his etching he would
carefully inspect it; only when he was satisfied would he remove the
varnish and pull about five trial proofs to check general appearance […]
If these proved satisfactory […] he would pull about twenty more proofs
before putting the plate aside” (14).

These early prints, created within Rembrandt’s lifetime, are known as lifetime impressions, and are the most valuable works on the market. The word also applies to those impressions that the artist may have pulled if an initial printing sold well. Nowell-Usticke estimates 25 more prints followed the “early” examples, and these he terms “intermediate”. The last prints are “late”. This simple nomenclature opens the door to a complex web of plates destroyed and existing, reprints, retouches and more.

An etching can exist in one state, or in nine and our job is to determine where the work in our possession fits in with the print’s history.

Catalogue entries ask the reader to scrutinize the shading on the edge of a cloak or look for additional horizontal shading on a window sill. States of a print can vary minutely, meaning correct identification requires careful examination. Without our extensive library, which contains rare books and is a source of pride here at the gallery, we would not be able to complete such comprehensive research.

In the case of our Jakob Thomasz Haringh (The Young Haring), however, there was little room for doubt. The catalogue informs us that state III impressions of this print show a large picture added to the wall at left; state IV impressions are printed from a plate that has been, “cut down to head & shoulders only; the picture has been removed, leaving some traces” (Nowell-Usticke, B 275). The trimming of the plate narrows our options considerably, enabling us to name the correct state.

When we acquired Curly Headed Man With a Wry Mouth, our research was similarly short-lived. The plate, which has been destroyed, only existed in two states. Since impressions from the later printing show “The badly worn face & neck gone over with the roulette,” we had no trouble categorizing a first state print (Nowell-Usticke, B 305).

Navigating the catalogue raisonnès can be confusing at first, and we don’t always find what we’re seeking, but the research opens technical windows onto a great artist’s work and methods. And it’s surprisingly satisfying to find, yes, “The cross no longer touches the border at L. Fine diagonal L-R shading added below scroll (Making 3 directions)” – must be a State II Christ Crucified Between Two Thieves, Oval Plate (Nowell-Usticke, B 79).

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Investing in Art in a Smoke-and-Mirrors Financial Market

Friday, August 5th, 2011

The stock market is in marked decline and bonds are showing pitifully low returns. Interest rates are at a minimum, as low as .5% in some countries. Given that the sub-prime mortgage fiasco kicked off this recession in the first place, real estate has not been looking too attractive as a haven for liquid assets.

To be sure, the national spectacle that was the debt ceiling crisis did not help things. Ending just hours before the United States ran out of money to pay its bills, the problem has actually been delayed, not resolved. Fitch Ratings warned that though the debt ceiling agreement reached Congress represents a step in the right direction, the U.S. still lacks, “a credible plan to reduce the budget deficit to a level that would secure [its] AAA status over the medium-term.” The threat still remains that the country’s credit rating may take a dive, fueled by lenders’ concerns that $14 trillion in debt is unsustainable.

Those who had never imagined the United States might be unable to settle its accounts are perhaps imagining a similar scenario played out in their own personal finances. For the individual, it may not be an option to file away these concerns for a later date. In the face of such an unstable financial market, investing in tangible assets can be an answer. Precious metals such as gold and silver are proving to be safe investments, having risen 16% and 30% in value respectively in 2011 alone. In the United Kingdom, you can turn to the Wine Investment Fund, where annualized returns range between 8% and 20%. And then there is the Fine Art Fund Group, whose investors are currently enjoying returns above 25%.

Even if you can’t afford the Fund’s $250,000 base level investment, individuals can build l art collections with personal and monetary value. Though numbers are tumbling right and left, the art market is going strong. Christie’s closed its Paris Contemporary Art auction at over €8.4 million ($3.8 million) on May 31, 2011, and showed similar numbers between its two Impressionist and Modern Art sales just weeks earlier. The auction giant recently hosted an entire event dedicated to Picasso ceramics, where pieces sold between $800 and $134,000. Such an extraordinary price range underscores the accessibility of art for investors with all budgets.

Whether you choose to fill your portfolio with Modern Masters such as Chagall, Miró, and Picasso, or contemporary favorites like Warhol, Yvaral, or Vasarely, you can’t go wrong.  Art is one of the few tangible assets that will simultaneously enrich your aesthetic life and ensure your financial wellbeing, over the long term.

Resources:
1. “U.S. Stocks Manage to Eke out a Gain.” New York Times. August 4, 2011.
2. “Gold, fine wine, art or under the bed: what’s the safest place for your cash?”Guardian UK. July 25, 2011.
3. Christie’s: Auction Results, May 2011.

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London Calling

Friday, June 24th, 2011

Impressionist and Modern sales were held this week in London with strong results. Sotheby’s ended with $157,543,910 in sales and Christie’s ended at $227,111,142. The stars of both nights were artists we currently sell. Pablo Picasso’s “Couple le Baiser” went for $10,621,070 which is 18 times higher than its previously recorded auction in 1993. Meanwhile, Picasso’s “Homme a la Pipe et Nu Couche” sold for $7,800,591.  Lastly, Picasso’s “Jeune Fille Endormie” and “Femme Assise, Robe Bleue” respectively sold for $21,866,588 and $29,133,148.

Joan Miró’s abstraction “Femme a la Voix de Rossignol dans la Nuit” sold for $7,709,608 while Henri de Toulouse-Lautrec’s “La Liseuse” sold for $9,165,339. “l’Empire des Lumieres,”  by René Magritte went for $3,888,313 and Pierre-Auguste Renoir’s widely exhibited “La Source (Nu Allonge)” sold for $8,241,788.

European buyers have been dominating the sales, but U.S. buyers have made an impact as well. This only goes to show that art is a great investment at any price level, in any country. With the steady return of good sales, art is stronger than it has been in quite while.

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Art Basel: Indications to Come?

Wednesday, June 15th, 2011

Art Basel is often described as the world’s top fair for modern and contemporary works and it opens June 15, 2011 with over 300 galleries displaying works for a combined total worth around $1.75 billion, according to specialist insurer Hiscox.

Art Basel features galleries from North America, Latin America, Europe, Asia and Africa. More than 2,500 artists, ranging from the great masters of Modern art to the latest generation of emerging stars, are represented in the show’s multiple sections. The exhibition includes the highest-quality paintings, sculptures, drawings, installations, photographs, video and editioned works. Last year, 62,500 people attended Art 41 Basel, including art collectors, art dealers, artists, curators and other art enthusiasts.

In the VIP preview that occurred June 14, 2011 there was well over millions of dollars of art sold. Even if one does not attend the fair or collect the artists represented by the galleries, the sales at the fair are excellent indicators of the market for both price and mood. Although the art market has yet to regain the giddy heights of the boom that preceded the 2009 slump, the million-dollar sales at Art Basel tell that the market is strong and worthy of investment.

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Treating Art as Stock

Thursday, May 19th, 2011

There is an interesting topic taking hold in the art world that has people talking and it centers around the global trend of creating Art Investment Funds. These art funds allow for individuals to make long-term investments in a portfolio of valuable artworks. What this means is that an art investment company either
a) buys particular works of art upfront whose value they believe will rise and then allows individuals to invest in the created portfolio and then upon selling the works of art will get a return OR
b) lines up individuals who put money towards purchasing art for a portfolio as an investment on the assumption that the value will increase and then upon selling the works of art will get a return.
All in all, they aim to maximize the rate of return on works in their collection.

There are many different options available besides these two but they are the most popular, as London-based Fine Art Fund displays. Fine Art Fund was the first fund of its type to invest in art as a worldwide asset class, and continues to be the only one to do so on a major international scale. However their creation is gaining in popularity as can be seen with several companies in several different countries taking a similar approach to the art market.

In Brazil, Plural Capital is an investment firm based in Rio de Janeiro and São Paulo that has launched BGA Private Equity Investment Fund. This new art-fueled market venture is worth $24 million and the strategy is to buy contemporary works, mainly from Brazil, for three years, and then spend two years selling off the art it has purchased. Therefore it encourages private investors to use the contemporary art market as a financial instrument.

Russia provides another example as to this sort of investment gaining popularity, but with a twist. One art investment firm, Atlanta Art, is valued at $4.7 million and just began trading last month. But it is Sobranie.Photoeffect valued at $467 million that is has a twist in their investment plan. What makes Sobranie.Photoeffect different is that instead of raising money from wealthy individuals to buy art, it has obtained its works from a group of anonymous Russian collectors. The plan for the fund is to sell five to 10 percent of its stock at auction every year, paying its final dividends after 15 years and then ceasing to exist. Sobranie.Photoeffect deals exclusively with photographs and holds over 290,000 original prints.

Russia and Brazil are not the only examples of art investment funds, but France and China offer different variations. In China, a financial corporation has gone public with China’s first openly traded art portfolio, on the Shenzhen Cultural Assets and Equity Exchange (SZCAEE). Issued by the Shenzhen Artvip Cultural Corporation, the art portfolio comprises 12 paintings by contemporary artist Yang Peijiang in the form of 1,000 shares, which sold out on the first day of trading, netting $354,480. As the artworks are traded by Artvip, which is managing the 12 works, profits are dispersed to shareholders. The Exchange itself is interesting as it was established in 2009 by the Chinese government, but functions as an alternative platform for the trading of a wide range of cultural assets — including artworks, luxury goods, and films — as part of the Chinese government’s attempt to commercialize, diversify, and regulate the public exchange of such cultural properties.

Meanwhile in France, the French company A&F Markets has come up with a venture called Art Exchange that will treat artworks as investment vehicles, opening them up to partial purchase by shareholders. The initiative has just launched with an offer of shares in two pieces, one by Sol LeWitt and the other by Francesco Vezzoli. Now 11,000 shares of LeWitt’s “Irregular Form” are available at $13 per share, for a total value of $142,000 and 13,500 shares of Vezzoli’s “The Premiere of a Play That Will Never Run” are also offered at the same rate, giving it a total price of $174,000.

What does an art investment fund do for you? Well it provides those who cannot afford to buy expensive works of art an avenue for reaping a profit off of the art, as well as provides new buyers with an “in” into the art world. In two of the examples listed above, shareholders are even able to have the piece on display in their home on a loan so to say. Thus, in addition to sharing the potential appreciation and profits of the artwork, the artwork is being admired and enjoyed as well.

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Art Market Riding High

Monday, May 16th, 2011

Now, is the perfect time to invest in art. The international market is booming with great returns, and here at Masterworks we want you to get the best from your investment. That is why we are laying out the best buying markets right now so you know the worth of your investment.

Impressionist and Modern Art is holding steady in the art market. Several impressionist records were set this past week with Maurice Vlamincks Paysage de Banlieu selling for $22,482,500 (originally bought 17 years prior for $6,822,500) and Maximilien Luces’sNotre-Dame de Paris, that sold for $4,226,500. Pablo Picasso was a top seller with Les Femmes d’Alger, Version L going for $15,762,500, Homme au Mouton selling for $7,138,500, and Femmes Lisant (Deux Personages) selling for $21,362,500. All of these rare works are being offered at the perfect time for both old and new investors to enjoy.

Contemporary Turkish Art, generally sold in Dubai and London, is blossoming into the international art world as can be seen in the specialized sales held at major auction houses in April. In total, the sales in April 2011 generated $6.1m. The best results were Ömer Uluç and Erol Akyava’s painting End of Encounter, which brought in $741,000. The Whispering Wall II by Burhan Cahit Dogançay reached $375,000, and an untitled work by Orhon Mubin went for $326,000.  These results show that the Dubaian market, which is traditionally strong for Contemporary Turkish art, is now being outshined by the European segment of the market.

Contemporary Chinese Art is dominating the global art market. Many of the works are selling for quadruple of what they were estimated at. Total revenue from one auction was $46.68m. One of the highest selling contemporary artist’s is currently Zhang Xiaogang, whose Forever lasting Love (1988) sold for $9m. Only time will tell if the market continues to rise or fall, but as Chinese art buyers are actively collecting, the market looks to be a good investment.

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Sonia Delaunay: On the Rise

Thursday, May 12th, 2011

Sonia Delaunay was born in Ukraine in 1885 and was adopted by her affluent Jewish lawyer uncle Henri Terk in 1890. She had a privileged upbringing and traveled Europe widely to various museums and galleries. At the age of 18 she was sent to an art school in Germany and in 1905 decided to move to Paris.

Once in Paris, Sonia enrolled in the Académie de la Palette in Montparnasse. However she was not happy there and tended to spend more time in the galleries around Paris. Her own work during this time was influenced by artists such as Van Gogh, Matisse, Henri Rousseau and Gauguin. In 1908 she married German homosexual art gallery owner Wilhelm Uhde. It was during her time at Uhde’s gallery that she met and had an affair with Robert Delaunay.

Sonia and Wilheim Uhde divorced in 1910, and Sonia went on to marry Robert Delaunay and have a son named Charles. Sonia is quoted as saying about Robert, “In Robert Delaunay I found a poet. A poet who wrote not with words but with colors.”

The Delaunays are often credited with the creation of Orphic Cubism or Orphism. This is a form of Cubism that focused on pure abstraction and bright colors influenced by Fauvism and the dye chemist Eugène Chevreul.

Sonia, who made paintings, prints, books, textile and fashion designs, carpets, furniture, mosaics, and the odd movie set, is more often remembered as the wife of Robert Delaunay, but she is an established artist in her right, whose works today are gaining the respect of the art market.

Susan Brown, who co-curated “Color Moves: Art and Fashion by Sonia Delaunay,” on view through June 5 at the Cooper-Hewitt, National Design Museum, in New York, notes that a critical reappraisal is in the offing. “It’s my impression that she’s going to fare better in the long haul. Particularly in the past 10 years or so, there’s been a lot of focus on her work.”This can be seen in the six auction records for Sonia that were set this past year, with prices outpacing estimates.

“The demand is escalating along with prices, and the number of collectors who seek her works is also rising,” says Thaddée Poliakoff, owner of Le Coin des Arts gallery, in Paris. Sonia’s high stands at €4.1 million ($3.9 million) from a 2002 auction of the 1915-16 canvas “Marché au Minho.”

Another opportunity for collectors are Sonia’s works on paper. Prices are relatively low for her prints and gouaches, which can be purchased from our Delaunay collection. It is “Pochoirs” that command the highest prices, due to rarity. According to Tudor Davies, head of prints for Christie’s Americas, “her etchings tend to be valued more highly than her lithographs, no doubt because they provide a better sense of surface.” He advises collectors to “look at the strength of the composition and the use of color and contrast. Simply put, you want the image to be as strong visually as possible when it is on the wall.”

Information was obtained from Artist Dossier: Sonia Delaunay – ARTINFO.com

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Warhol, Warhol, Warhol

Wednesday, May 11th, 2011

The talk of the art market these past weeks have all surrounded Andy Warhol, proving once again that you can never go wrong when investing in Warhol. Warhol’s works are still consistently selling at high prices, with over of 52 Warhol’s having gone and/or going up for auction for a total estimated value of $148 million.

“Sixteen Jackies” was sold for $20,242,500, while “Shadow-Red” (1978) sold for $4,842,500. Warhol’s “Statue of Liberty” (1986) sold for $3,442,500 this past week and was last sold in 2008 for $2,210,500. That is a 2.8% increase in value over 3 years for an average of .93% increase in value a year. With a steady increase such as that there looks to be no stopping the raising values of Warhol.

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Joan Miró: A Creative Life

Monday, May 9th, 2011

To most art lovers, a painting by Joan Miró is immediately recognizable. It displays botanical, geometric or abstract lines or shapes floating against celestial blue, sandy yellow or earth brown backgrounds. It also probably exudes a mystical yet reassuring dreamy quality. However interestingly enough, his personality was nothing like his work.

Miró was a highly disciplined hard working man. He spoke little and looked like the perfect bourgeois. He was orderly, reliable and punctilious. He was astonishingly versatile, willing to try almost anything. Nothing of him had any touch of a free spirited bohemian that he seemed to exhibit in his works.

In 1927, when Miró was 34 he was already a successful artist but he had a restless temperament and lived in provoking times. Surrealism, he discovered, had limitations. He was ready for a radical change in art, but he realized that he would have to create it himself. With his famous words, “I want to assassinate painting,” Miró did just that.  He took the elements out of art and stuck to the essentials. Whether he used a limited color palate or sparse geometric designs or different material he deified the essence of painting being on a canvas.

”I personally don’t know where we are heading,” Miró told a Spanish journalist in 1931. ”The only thing that’s clear to me is that I intend to destroy, destroy everything that exists in painting. I have utter contempt for painting. The only thing that interests me is the spirit itself, and I only use the customary artists’ tools — brushes, canvas and paint — in order to get the best effects. I’m only interested in anonymous art, the kind that springs from the collective unconscious.”

By the end of his long life, Miró had executed paintings and sculptures that prefigured Abstract Expressionism, Pop art, Color Field painting, process art, appropriation, and even conceptualism. Ultimately he succeeded in his goal of “assassinating painting”, and left us with a canvas of brilliant colors combined with simplified forms that allow us to embrace our inner child.

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What is “original”?

Wednesday, April 13th, 2011

A print is termed, “original” if the artist of the design has worked on the printing element himself, as opposed to reproductive and interpretative prints which involve the use of an intermediary person to reproduce the design onto the printing element. Original prints are often only produced in small numbers; they may be numbered and signed by the artist. These distinctions between reproductions (which occasionally may also be signed and numbered) and original prints are, however, generalized.

It must be noted that some people have a much more rigorous definition of an original print than others, however we consider the collaborative work completed during the artist’s lifetime with their signed approval to be an original, as they produce a vibrant image that more skillfully projects the artists’ message. Given the multitude of techniques used by key artists and the great variety of techniques available, the involvement and collaboration of the artist leaves one with no sensible conclusion then to say all techniques should be considered equal as long as the artist’s intent was approved through the artist’s original signature on that piece of work.

Posted in Art investments, Everything else, Original prints |

Current State of the Art Market 2011

Thursday, March 24th, 2011

As the modern and contemporary art market continues into spring, confidence among buyers and sellers is increasing. Auctions in recent months have seen spectacular sales in modern and contemporary art. As an example, a recently rediscovered 6-by-6 foot Andy Warhol self-portrait doubled its pre-sale estimate to fetch $17.4 million at a London auction in February.

What this means is that art, is once again, becoming a chief investment as the difficult economic times appear to be improving. Concerns remain of course, but the recent months of great sales due to the emergence of wealthy collectors from Asia, the Middle East and South America has deepened the pool of buyers and therefore increased the demand.

Posted in Art investments |

The monetary market wavers, the art market soars.

Saturday, July 3rd, 2010

We have seen some of the most impressive hammer prices in the art market in recent weeks. Here are a few key sales.

The BBC explains recent Christie’s London sales:

A “blue period” Picasso has fetched £34.7m at auction in London.

Christie’s says the event will be the biggest art auction ever held in London. It forms the centrepiece of a week of arts sales in the capital, where a self-portrait by Edouard Manet has already been snapped up for £22m.

Prices have soared recently, with Picasso’s 1932 picture Nude, Green Leaves and Bust fetching $106m (£72m) in New York last month, making it the most expensive art work sold at auction.

Read the full article

In The Wall Street Journal’s A Flight to Tangibles, world famous art dealer David Nahmad describes the art market. “It is simple,” says David Nahmad, one of the world’s most famous art dealers. “A lot of investors are distrustful of equities. They are terrified of cash that pays 0% at the bank and is threatened by the ‘great inflation’ lying one to two years ahead.”

He adds, “There is no argument over their worth; they just grow constantly in value in an art market that is awash with money but short of supply. They are also very safe. If the world collapses but you own a Picasso, then amid the ruins you still own a Picasso. What we are seeing is a flight into tangibles. It has happened many times before.”

Read the full article

Posted in Art investments |

Art Market Breaking Records Going Into 2010, by Alex Adelman

Tuesday, December 1st, 2009

The fine art market has shown that it is strong enough to withstand the downturns of the current stock market, and this strength is showing very clearly in recent auction results. There has been more action in art sales in the last half of 2009 than I have seen in the past 4 or 5 years. The gains are across the board from Rembrandt to Warhol, and all over the world.

As people become less comfortable with intangible investments, such as stock market shares, we are seeing a reallocation of moneys to tangible assets, such as precious metals, gems, and fine art. As the returns continue to grow, so will the art market.

In November 2009, Sotheby’s New York estimated Andy Warhol’s “200 One Dollar Bills” at $8 million to $12 million. It sold at an impressive $43.8 million . “Bidding was very deep tonight. There is a great desire for great art – consumer behaviour has started to accelerate,” said Sotheby’s head of contemporary art Tobias Meyer.  Also in November, a metal multiple by Victor Vasarely beat out estimates by over 300%.

These recent hammer prices prove that there is a revitalized demand for beautiful art going into 2010.

UPDATE (Feb. 10, 2010): Yet again, hammer prices are soaring well over high estimates on auctions in 2010 at Sotheby’s and Christie’s. A Nazi-looted Gustav Klimt painting was estimated at $19 mil to $29 mil, and sold for $45.4 mil.

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Posted in Alex Adelman Masterworks Fine Art, Art investments |

Certificates of Authenticity, Alex Adelman, & Masterworks Fine Art

Tuesday, May 12th, 2009

In an effort to keep fine art collectors more informed of the ebbs and flows of the art market, and in particular, Masterworks Fine Art, Inc.’s role as one of the most qualified fine art dealers online, we wanted to pass along an extensive and highly informative article on the topic of prints, originality, Certificates of Authenticity, fine art licensing, and licensing agreements.  Written by Brooke Oliver, a nationally recognized art and intellectual property lawyer based in San Francisco, CA, this article is a great reference for those who are interested in learning more about print authenticity.  Oliver covers the gamut of print making processes, the legal criteria for Certificates of Authenticity in many states within the U.S., determining the value of prints, and moreover, the significance of Certificates of Authenticity that must accompany the sale of any print.  She begins her discussion with a reference to the forefathers of the printmaking world, many of which we carry within our inventory; Albrecht Dürer, Martin Schongauer, and Rembrandt van Rijn provide a highly relevant background in establishing the age-old relationship between artist/printmaker, publisher, and dealer.  The bulk of the article serves as a reference for distinguishing the types of prints, editioning, and proofing.  She concludes the discussion with a section on art licensing and licensing agreements.

Oliver has included a brief summary of her work below:

“This paper will explore the issues of authentication, value, and fraud that arise with the sale of fine art prints, and provides working definitions of the often misunderstood types of prints such as etchings, serigraphs, Giclée prints, and other terms used in and around print making and certificates of authenticity.  It provides information about numbering of limited edition prints, disclosures that are often required with the sale of such prints, and information about the significance of chop marks and copyright and trademark notices.  It includes information and resources about art agents and art licensing” (3). [Oliver & Sabec P.C., San Francisco, CA | tel 415.641.1116]

We highly encourage the due diligence of all of our prospective clients, interested collectors, and curious art lovers to take the time to engage, research, and become better informed about the art that drives their interest.  Masterworks is dedicated to its role as the primary online resource within the fine art and print community and believe that Oliver’s article is a great direction towards encouraging open, honest relationships between art dealers and their clients.*

Download PDF here (text version)

* The opinions expressed in the above article, in general, are exemplary, which in our ever-changing art market seem out of date given that this article was written in 2004.  If you have any questions or comments about the above article, you may contact President of Masterworks Fine Art, Inc., Alex Adelman at alex@masterworksfineart.com

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Posted in Art investments |

Some brief thoughts about art and the current market

Friday, February 13th, 2009

Most Impressionist and Modern Art sales in early February 2009 proved that art prices and its market remain strong. And, in a time of crisis, records can still be broken. Great works, strong images, and iconic works attested to be the most desirable and attained the highest results. In February 2009, this Edgar Degas sculpture sold well over its estimate at 13.3 million pounds, as well Joan Miro’s 4-foot 9-inch tall surrealist abstract, “Femmes et Oiseaux dans la Nuit”, on the same day.

The lessons are clear: art continues to be a sound investment, and one should continue collect works as I have always argued. The best of art lifts the spirits, hearts, and minds of those who view them. Great art takes the viewer to new places and experiences, allowing the viewer to be moved in both mind and spirit. Art has always been an investment in two areas: firstly, the heart and soul; secondly, an economic one that weathers the test of time better than most all other tangibles.

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Posted in Art investments |

Buying from Masterworks Fine Art vs. Auction Houses

Wednesday, January 21st, 2009

This section is meant to contrast auction house statements of authenticity and condition and compare them to Masterworks Fine Art’s terms and conditions of same. The statements extracted from the website or catalogues of the auction houses listed below are direct quotes. These have been extracted from their Conditions of Sale.

In effect they state that all auction items are sold “AS IS” with no statements of guarantee or condition attached.

In Contrast: Masterworks Fine Art’s guarantees BOTH the authenticity and the condition of its works – IN FULL – for the lifetime that our clients own a work. There are no exceptions or restrictions to this statement.

There is an understanding between the auction house and the buyer that once the sale is finalized, the auction house absolves any responsibility for what they just sold. There is a strong element of risk involved with this type of sale. A great deal of expertise is needed when dealing with auction houses for this reason.

There are those collectors who compare our pricing with that of auction houses. Those who compare Masterworks Fine Art’s Condition of Sale in terms of guarantee and authenticity are out of touch with the reality that we must back our sales in perpetuity to the original seller. While our pricing is below retail, we have not and will not attempt to match auction pricing.

Our prices are slightly higher (sometimes even lower), but we hold ourselves to higher standards. Read below for excerpts of various Conditions of Sales from the following prominent auction houses:

Christie’s

“Neither Christie’s nor the seller provides any guarantee in relation to the nature of the property… The property is sold “as is”… All statements by us in the catalogue entry for the property or in the condition report, or made orally or in writing elsewhere, are statements of opinion and are not to be relied on as statements of fact. Such statements do not constitute a representation, warranty or assumption of liability by us of any kind. References in the catalogue entry or the condition report to damage or restoration are for guidance only and should be evaluated by personal inspection by the bidder or a knowledgeable representative. The absence of such a reference does not imply that an item is free from defects or restoration, nor does a reference to particular defects imply the absence of any others.”

Sotheby’s

“All property is sold “AS IS” without any representations or warranties by us or the Consignor as to merchantability, fitness for a particular purpose, the correctness of the catalogue or other description of the physical condition, size, quality, rarity, importance, medium, provenance, exhibitions, literature or historical relevance of any property and no statement anywhere, whether oral or written, whether made in the catalogue, an advertisement, a bill of sale, a salesroom posting or announcement, or elsewhere, shall be deemed such a warranty, representation or assumption of liability. We and the Consignor make no representation and warranties, express or implied, as to whether the purchaser acquires any copyrights, including but not limited to, any reproduction rights in any property. We and the Consignor are not responsible for errors and omissions in the catalogue, glossary, or any supplemental material.”

Bonhams & Butterfields

“All property is sold “as is.” Neither Bonhams & Butterfields nor the consignor makes any representation or warranty, express or implied, as to the merchantability, fitness or condition of the property or as to the correctness of description, genuineness, attribution, provenance or period of the property or as to whether the purchaser acquires any copyrights or other intellectual property rights in lots sold or as to whether a work of art is subject to the artist’s moral rights or other residual rights of the artist. The purchaser expressly acknowledges and agrees that in no event shall Bonhams & Butterfields be liable for any damages including, without limitation, any compensatory, incidental or consequential damages.”

Doyle New York

“All lots are sold “AS IS” and without recourse and neither Doyle New York nor its consignor makes any warranties or representations, express or implied, with respect to such lots, except for the limited warranties expressly stated in the Terms of Guarantee section of this catalogue… Express or implied warranty or representation of any kind or nature with respect to merchantability, fitness for purpose, correctness of the catalogue or other description of the physical condition, size, quality, rarity, importance, medium, material, genuineness, attribution, provenance, period, culture, source, origin, exhibitions, literature or historical significance of any lot sold. The absence of any reference to the condition of a lot does not imply that the lot is in perfect condition or completely free from wear and tear, imperfections or the effects of aging; nor does a reference to particular defects imply the absence of others. References in the catalogue entry or the condition report to damage or restoration are for guidance only and should be evaluated by personal inspection by the bidder or a knowledgeable representative.

The Terms of Guarantee are controlling, and no statement, whether written or oral, and whether made in this catalogue, an advertisement, a bill of sale, a salesroom posting or announcement, the remarks of an auctioneer, or otherwise, shall be deemed to create any warranty, representation or assumption of liability. All statements by Doyle New York in the catalogue entry for the property or in the condition report, or made orally or in writing elsewhere, are statements of opinion and are not to be relied on as statements of fact. Except as stated in the Terms of Guarantee, neither Doyle New York nor the seller is responsible in any way for errors or omissions in the catalogue or any supplemental material. Buyers are responsible for satisfying themselves concerning the condition of the property and the matters referred to in the catalogue entry.”

SWANN Galleries

“All property is sold “as is” and neither Swann nor the consignor makes any warranties or representations of any kind or nature with respect to the property or its value, and in no event shall they be responsible for correctness of description, genuineness, attribution, provenance, authenticity, authorship, completeness, condition of the property or estimate of value. No statement (oral or written) in the catalogue, at the sale, or elsewhere shall be deemed such a warranty or representation, or any assumption of responsibility.”

Leslie Hindman Auctioneers

“All lots are sold “AS IS” and without recourse and neither Leslie Hindman Auctioneers, Inc. nor its consignor(s) makes any warranties or representations, express or implied with respect to such lots. Neither Leslie Hindman Auctioneers, Inc. nor its consignor(s) makes any express or implied warranty or representation of any kind or nature with respect to merchantability, fitness for purpose, correctness of the catalogue or other description of the physical condition, size, quality, rarity, importance, medium, material, genuineness, attribution, provenance, period, culture, source, origin, exhibitions, literature or historical significance of any lot sold. The absence of any reference to the condition of a lot does not imply that the lot is in perfect condition or completely free from wear and tear, imperfections or the effects of aging. No statement, whether written or oral, and whether made in this catalogue, or in supplements to this catalogue, an advertisement, a bill of sale, a salesroom posting or announcement, the remarks of an auctioneer, or otherwise, shall be deemed to create any warranty, representation or assumption of liability. Leslie Hindman Auctioneers, Inc. and its consignor(s) make no warranty or representation, express or implied, that the purchase will acquire any copyright or reproduction rights to any lot sold.”

SKINNER Auctioneers and Appraisers of Antiques and Fine Art

“All property is sold as is, and neither the auctioneer nor any consignor makes any warranties or representation of any kind or nature with respect to the property, and in no event shall they be responsible for the correctness, nor deemed to have made any representation or warranty, of description, genuineness, authorship, attribution, provenance, period, culture, source, origin, or condition of the property and no statement made at the sale, or in the bill of sale, or invoice or elsewhere shall be deemed such a warranty of representation or an assumption of liability.”

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Posted in Art investments |

Buying from Masterworks vs. Other Galleries

Wednesday, January 21st, 2009
Masterworks Fine Art, Inc.
Masterworks Fine Art, Inc.

The answer is fairly simple economics: with Masterworks Fine Art, Inc., you’re dealing with a private dealer that doesn’t have the typical overheads of a retail gallery.

Retail gallery operations average about $500k/month in overhead costs – these costs must be factored into the price of the art that the gallery sells.

With Masterworks, our pricing is much lower because you’re dealing with a private dealer who owns and sells his own inventory. Our overhead costs are a mere fraction of the monthly operating cost of a typical retail gallery.

There are no sales commissions to pay. You deal directly with the President of Masterworks whose long-term interests are different than that of a typical gallery. Masterworks’s overall goal is to build a long-term working relationship with a client and NOT, for example, a one-time sale to help a sales consultant make their monthly rent.

In terms of expertise, most gallery salesmen do not have specialties in fine art, art history, or art techniques and technologies. You typically deal with a salesman who couldn’t care less whether they sell a car, a watch, or a work of fine art. Masterworks is passionate about fine art and believes our clients should share in this passion, curiosity and respect for the fine art they seek to collect.

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Posted in Art investments |

Tips for Buying Fine Art

Wednesday, January 21st, 2009
Chagall lithograph, Bonjour Paris Signed CHAGALL lithograph, Bonjour Paris (Good Morning Paris), 1972

With a rapidly changing economy it has become increasingly evident that many people are turning to different kinds of tangible assets as a hedge against both inflation and recession. In my 35 years of experience collecting, buying, and selling original works of fine art, I have found the art market to be far more stable and yield far more consistent returns than any other tangible financial instrument that I know of. It comes down to a general belief that it’s all about collecting “names”, or artists whose careers and reputations have long been established and are not going to fade with the advance of time.

The guide presented below is generally intended for customers who are buying original works of fine art and spending between $10,000 and $250,000. In general, my first piece of advice is to buy well-established, famous-named artists; Old Masters (e.g. Rembrandt, Dürer) and Modern Masters (e.g. Chagall, Picasso, Miro, Matisse, Braque) are certainly sure bets. On the Contemporary side, artists like Calder, Vasarely, and Yvaral are great artists to collect, enjoy, and invest in. (I would include works by Warhol in this list, but his market has become so over-heated that I have some concerns about the sustainability of the doubling and tripling of prices that have occurred on an annual basis over the past 4 or 5 years.)

Buy / Acquire only original works of fine art

Differentiating originals from reproductions can be difficult especially when the artistic media used to create an artist’s work has changed so dramatically over the years. An original etching, lithograph, serigraph, and aquatint for example, are easy to differentiate because they do not show a dot matrix (classically associated with reproductions of original works of art).

The challenge today is that many contemporary artists use mass media for reproducing images like off-set lithography, collotypes, and Giclée to reproduce their works. However, this does not necessarily mean that these works are not original works of fine art. The following conditions are necessary in order to be considered original works of fine art:

  1. Hand-signed & Numbered: Works must be hand-signed by the artist and numbered in limited editions.As an example of this, the vast majority of Warhol prints – while among the most collected in the world – are all photo-mechanically reproduced and are not classically considered original serigraphs or lithographs. But because this is the only way Warhol worked, these pieces are considered original works, even though they technically are not. We understand this is a confusing distinction to make and I am happy to be contacted on a piece-by-piece basis to explain the level of involvement by the artist with each work.
  2. Catalogue Raisonné Information & Documentation: Be sure that the print corresponds to the printed documentation in a catalogue raisonné of the artist’s, publisher’s, or printer’s work. Artists did not make an original work in 3 different sizes, for example; only 1 size of an original work is typically produced. A good, thorough catalogue raisonné will tell you the technique of manufacture, size of image, size of the printed sheet, and the edition size.There is a minor caviot to this: some areas of printmaking are not documented properly or thoroughly and mistakes can be found in those catalogues that do exist. This is relatively rare and can be explained in other ways.
  3. Lifetime Impressions vs. Re-Strikes: A print produced during an artist’s lifetime will have certain qualities and characteristics that are documented in the artist’s catalogue raisonnés. Re-strikes, later impressions, or posthumous works fall in another category. These works are usually printed from original plates. However, the artist did not authorize their creation. They may have been authorized by the artist’s estate but their value is diminished over that of an original work pulled under the artist’s direction and supervision during his lifetime. Both are collectable, but the values will vary greatly.
  4. Certificates of Authenticity (COAs): Certificates for graphic works are in general, worth the paper they are printed on; they are only as good as the company who issues them. Having said that, certain COAs are better than others and they should only contain factual information, verifiable by outside sources.

For older works of art, much of this information remains unknown, especially prior to 1900. In those circumstances, you do your best to answer the questions as truthfully and faithfully as possible. Unique works of art (as opposed to original prints) frequently come with COAs by the designated member(s) of an artist’s family who have the moral right to authenticate a work of art.

For example, if you were buying a Picasso unique work, the only people who have the authority to authenticate those works, are Maya Picasso and Claude Picasso (appointed by the French government). If the work of art was by Marc Chagall, the Comité Chagall is THE only entity that can authenticate a unique original work by Chagall. The problem for those dealing in graphic works is that most experts will not authenticate them (they only deal with unique originals).

Please find the following excerpt on COA requirements as stated by the State of California Civil Code 1744 (as of 2003):

  1. The name of the artist
  2. Information about any artist’s signature appearing on the multiple, such as whether the artist signed it personally or whether it was stamped by the artist’s estate, or by some other source.
  3. A description of the medium or process used in producing the multiple such as etching, engraving, lithographic, serigraphic, Giclee or a particular method or material used in any photographic developing processes.
  4. A statement about any photomechanical, photographic, or surmoulage (for sculpture) process used to create a multiple of an image produced in a different medium, for a purpose other than the creation of the multiple being described, and a statement of the respective mediums.
  5. If a photomechanical, photographic or surmoulage process was used, and the multiple is not signed, a statement about whether the artist authorized or approved in writing creation of the multiple or the edition.
  6. Information about whether the artist was deceased at the time the master was made which produced the multiple.
  7. Information about whether it is a “posthumous” multiple, that is, where the master was created during the life of the artist but the multiple was produced after the artist’s death.
  8. If it is a second or later edition of multiples made from a master that produced a prior limited edition, or if the master for this edition was made from a print or master that was made from a prior multiple, this shall be stated. In addition, the total number of multiples, including proofs, of all other editions produced from that master must be stated.
  9. The year, or approximate year, the multiple was produced shall be stated, if the multiple was created after 1949. For multiples produced prior to 1950, the certificate must state the year, approximate year or period when the master was made and when that particular multiple was produced.
  10. Information about whether the edition is being offered as a limited edition, and if so: (i) the authorized maximum number of signed or numbered impressions or both, in the edition; (ii) the authorized maximum number of unsigned or unnumbered impressions, or both, in the edition; (iii) the authorized maximum number of artist’s, publisher’s or other proofs, if any, outside of the regular edition; and (iv) the total size of the edition.
  11. Whether or not the master has been destroyed, effaced, altered, defaced, or canceled after the current edition. If for example the master screens have been destroyed, then the atelier cannot make any additional images more of that image.
  12. If the multiple is part of a limited edition that was printed after January 1, 1983, that statement of the size of the limited edition also constitutes an express warranty that no additional multiples of the same image, including proofs, have been produced in this or in any other limited edition.

Pricing

Pricing is, on a retail basis, based on a gallery’s overhead costs, including its location, sales commissions, etc.; frequently pricing will entail a 50%-100% mark-up. I advise collectors to inquire about galleries’ pricing methods what factors go into the pricing of their inventory. That question alone, if it goes unanswered in a satisfactory manner, should give you an indication of the establishment’s legitimacy and customer service. (As an aside, if you think you can find an original hand-signed work by a prominent artist like Chagall or Picasso for less than $5,000 you are probably buying a fake or a reproduction with a photo-mechanical signature. There’s no such thing has an authentic, hand-signed Chagall for $399.99. However, there can be major price variations where an original Chagall might be $10,000 in one gallery and $25,000 in another – all this varies based on the information provided above.)

Signatures

How do you know an artist really hand-signed a work? The artist’s birth/date dates should be listed on any COA so that you know the real Pablo Picasso (born 1881; died 1973) really signed it, as opposed to a Pablo Picasso in Chicago, IL who is still alive. It is important that the artist’s dates be present to make this distinction very clear.

For major artists, there are frequently comparative catalogues and signature registries where you can find comparable signatures to help gain confidence that the artist truly signed the work. This information should also be contained in the catalogue raisonné, the best of which should tell you if there are unsigned impressions and if so, how many.

Proactive Research & Due Diligence

Do your best to educate yourself about an artist’s work. Speak to the gallery owner directly and ask these questions to make sure you feel confident about your acquisition. A professional dealer will allow for returns, exchanges, and guarantee the work of art’s authenticity for the lifetime of your ownership of that work. Find a good glossary of terminology to research and understand precisely the terms that are involved in the description of the artist’s work. (Masterworks Fine Art, Inc. offers an abbreviated glossary of art terms.)

Quality in a Work of Art

Original works of fine art are hand-made. Because of this, there is variation in the quality of impression. Due to the ravages of time, there are variations in color saturation and condition. A print that has a tear across the middle of it is clearly going to be worth less than a print with full margins and in flawless condition. Brilliant, crisp impressions will sell more successfully than dull, worn impressions. The price ranges can be enormous; for example, an early impression of a Rembrandt print might be priced at $100,000. A later, poorer impression could be $7,000. What makes the difference is a good, strong knowledge of connoisseurship and connoisseurship criteria.

Connoisseurship

This is a critical aspect in acquiring any work of art. Connoisseurship has to do with the assessment and understanding of quality in an original work of fine art. Connoisseurship will always determine the work with the greatest value – which will be the most iconic image by a specific artist. Connoisseurship in a work of art will vary from artist to artist. With Chagall, for example, it has to do with solely the amount of color saturation and Chagall-like imagery. With Picasso, in contrast, connoisseurship will depend on the graphic qualities of the image and the brilliancy with which he is able to convey a message in a relatively small number of strokes.

I often reference and artwork’s “curb effect,” or its ability to pulls you in from across the room, allowing you to distinctly tell who the work has been created by. A Picasso that looks like a geometric work of art by Vasarely is not ever going to be as desirable or collectable as a Picasso of a mother holding a child from the Blue Period. In other words, historically, the most collectable and valuable works of art by major artists, are works that scream they are works by those artists.

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Buying Art in Times of Economic Uncertainty

Wednesday, January 21st, 2009

By Irma Adelman, Berkeley School of Agricultural Economics

Picasso ceramic
Picasso ceramics

By Irma Adelman, Distinguished Fellow, American Economic Association

We are living in an era of great uncertainty coupled with major structural change.  The structural change affects not only the US economy but also its demographic structure, its technology, its communication system and its global economic relations. In addition, we are in the middle of two wars, locking us into substantial military and economic assistance expenditures.  Furthermore, the political system has become dysfunctional and the economy paralyzed.  No wonder economic growth has become stagnant and unemployment rampant.

Along demographic lines, we are experiencing an increase in the fraction of population of retirement age that is not compensated by an increase in people of working-age.  In addition, there has been a rise in life-expectancy.  The net result is that a greater share of GNP must be devoted to maintaining retirees and providing them with health-care. Also, a larger share of the work-force must be imported and we must graduate into a post-industrial age.

Technical change has had many different ramifications.  Production has become more high- education intensive. The speed of the communication-system has become instant from virtually all points of the globe. It has therefore become possible to decentralize production globally, while maintaining managerial and technical control  in the US with a consequent  globalization of production in what are nominally US-firms coupled with  a 24-hour production cycle. And the transmission of news across the globe has become essentially instant, accelerating economic, financial and political reactions to events happening anywhere in the world.

Personal investment strategies need to adjust to take the current economic outlook into account. During periods of stagflation stocks usually decline. Bonds yield very low nominal returns. In fact, bonds currently yield negative real returns when one factors in present rates of inflation. Financial assets are therefore unattractive as well as unusually risky. This leaves real assets, and, in the short run, foreign currency.

Among real assets, the traditional major form of investment in housing and real estate holdings is unattractive, since their prices are declining precipitously, and there seems to be no end in sight. Indeed, this, together with the collateralization of mortgages and the evolution of derivatives is the basic cause of the current US financial crisis.

So, currently, the best form in which to hold savings is in tangible assets other than housing. These include, but are not limited to, precious metals, natural resources and art.

Art has exhibited a number of trends. During the past several decades, art has escalated in value. In fact, on the average, rates of returns from art have exceeded those from stocks. The biggest price increases have been for contemporary art, followed by impressionist and modern art, and by old masters.

The major names, with long established museum credentials, have withstood the test of time best and yielded the greatest price increases. Buying a nice work by an unknown artist is like going to the gambling tables in Vegas: you never know what will happen in the long run. In contrast, works by known artists of great repute have yielded the largest returns. Picasso, Chagall, Miro, Calder, Warhol, and Vasarely are just a few artists whose works come to mind.

The major names, with long established museum credentials, have withstood the test of time best and yielded the greatest price increases. Buying a nice work by an unknown artist is like going to the gambling tables in Vegas: you never know what will happen in the long run. In contrast, works by known artists of great repute have yielded the largest returns. Picasso, Chagall, Miro, Calder, Warhol, and Vasarely are just a few artists whose works come to mind.

Lastly, on a personal note, art, of course, has another advantage. Art is inspirational, and is the tangible commodity that not only increases in value but also gives visual pleasure and stimulation.

Irma Adelman, FRSA
Thomas Forsyth Hunt Chair
Professor Emerita,
University of California, Berkeley School of Agricultural Economics
Fellow, Econometric Society

Fellow, American Academy of Arts and Sciences

Fellow, the Royal Society for the Encouragement of Arts, Manufactures & Commerce

Fellow, American Agricultural Economics Association

Order of Bronze Tower, Government of South Korea, 1971

Vice President, American Economic Association, 1979-80

Women’s Hall of Fame, University of California at Berkeley, 1994

Distinguished Fellow, American Economic Association, 2004

Laurea ad Honorem in Economia Politica, Universita Di Parma, Italy 2005

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Browse our collection of Marc Chagall lithographs and Rembrandt etchings. We also carry collectible contemporary fine art, such as Calder lithographs. Read about Durer woodcuts, by Alex Adelman. Included with each purchase is our COA, all available documentation, and our 100% money-back guarantee.