HERE I SIT WITH A HORRID LITTLE BOOK. Well, not so little at 300 pages but definitely unlikeable. Fine Art and High Finance by one Clare McAndrew was published this year by Bloomberg Press [yes, that Bloomberg]. Subtitled Expert Advice on the Economics of Ownership, it is a handbook on the global art trade meant for the financial sector. Dr. McAndrew explains:
The international art market is estimated to have turned over more than $60 billion in total sales of fine and decorative art and antiques in 2008, one of its highest-ever recorded totals. By sheer size alone, therefore, it is easy to see why it has sparked the interest of the mainstream investment community: the art trade is big business. It is also a truly global business, with sales of art taking taking place literally all around the world.
The introductory chapter offers a brief history of the modern art market:
In previous decades, buyers at auctions tended to be a small number of highly informed dealers who understood the market, had expertise in particular specialties, and purchased at lower prices in order to resell to collectors. During the 1960s and particularly in the recessionary early 1970s, however, art began to be promoted as a hedge against rampant and escalating inflation, and auctions began to attract an increasing number of “retail” clients.
To respond to this trend, some of the “supergalleries” emerged, with global outlets in various cities throughout the world to accommodate and expanding buyer base. Although sales in many sectors were affected by wider economic events like the oil crisis in 1973, art was increasingly bought by investors and speculators as well as by collectors.
Andy Warhol, Dollar
All this is true. So what is not to like? I dislike it because it validates what Jacques Barzun said not so long ago, that “Art-and-culture is one word. It means money.” That is not a comforting truth to have confirmed. We trot off to galleries and museums like pilgrims to St. Winifred’s well, thinking we are gaining some kind of cultural/spiritual indulgence for ourselves. In reality, we are admiring things produced for a commodities market. We are admiring currencies.
The book devotes a chapter to art banking, one to the various art funds, another to art-price indices, and the like. It offers algebraic equations for determining art risks and the transfer of risk. It gives such handy advice as:
The marginal or extra utility from holding a second or third Picasso, Goya or Warhol may not decrease by as much as owning the second or third piece of real estate in your favorite holiday destinations.
But of course! It has been clear for some time that art is a moveable form of real estate. And measured in price per centimeter, it is the most expensive real estate on the planet. Why, then, should it bother me to have that reality spelled out so relentlessless? So very helpfully? Besides, has not art always been a luxury product?
Yes, art has always cost money. But a sea change has been occurring in our life time. It is now something that is expected to make money. For all the high-minded declarations to the contrary, art has become the admissable—unobjectionable and seductive—face of raw materialism in our time.
For those of us who make our way in the arts, that is a hard realization to live with.
