In Terms Of

Tag: Dealers

  • Speculate in Art? Not Us!

    This text is the first of three that reviews the first World Art Market Conference, held in 1976. Read the second and third reports.

    First World Art Market Conference
    Friday and Saturday, October 29–30, 1976
    New School of Social Research, New York

    Rereading this report [from Lynden B. Miller] in 1990, the notion of a “Last World Art Market Conference” comes to mind—what to do while the value of your collection bottoms out. Of course all this took place at the onset of gold fever, when it did not do to admit, at least in public, that one might indeed “speculate in art.”

    Speakers: Thomas Hoving, Milton Esterow, Thomas Messer, Leo Castelli, Ivan Karp, Ruth Braunstein, others, dealers

    Billed as “The First World Art Market Conference,” coproduced by the New School and ARTnewsletter—a biweekly hot-tip dispenser that you can pick up for a mere $60 a year—the show was, as John Everett, president of the New School, said in his opening remarks, about the “business of art.” It appeared to be mostly a media event. The press was given the three front rows, fussed over with TLC. Some four hundred others, dealers, and collectors from around the country, and a few artists hoping to learn about “business,” paid $200 each to see and hear the superstars of the art market. Those expecting a clear view of the crystal ball—specific investment advice—were disappointed. But they got lots of encouragement and word that the art market is very good these days.

    After the “welcoming continental breakfast,” Everett told us there’s money “itching” to be spent in art. Next, Milton Esterow, publisher of ARTnewsletter and ARTnews, cosponsor, and comoderator, earnestly assured us that those who make money on art buy for aesthetic reasons only—that you can’t make money speculating on art. Then we got down to the serious business of trying to find out how to do just that.

    Keynote speaker Thomas Hoving, director of the Metropolitan Museum of Art, bounded onstage for a rapid-fire delivery of his optimistic view of the future of museums, now changing, he said, from passive displayers of art to active educators and conservators of art and culture (thus, not surprisingly, making a case for many of his own controversial changes at the Met).

    Then the august directors of such institutions as Wildenstein, Parke Bernet, and Christie’s sedately discussed trends in art-buying around the world, with an emphasis on pre-twentieth-century painting and sculpture and other art objects of increasing rarity, which, they agreed, will become even more expensive. Despite several years’ slump, it seems there is still a lot of money around for art, particularly in the US Southwest, Europe, and, more recently, Iran and the oil-producing countries. Esterow tried manfully to elicit some inside information on specific items or periods for investment, but to no avail.

    castellikarpwarhol
    The dealers Leo Castelli (left) and Ivan Karp (center) with Andy Warhol in 1966 (photograph by Sam Falk/New York Times)

    After lunch, Thomas Messer [of the Solomon R. Guggenheim Museum] spoke wittily of the museum director’s difficulties in maintaining the excellence of a collection without money, and his efforts to get same.

    The 2:30 PM panel discussion—with Leo Castelli, André Emmerich, Lawrence Rubin, and Ivan Karp of New York; Portia Harcus of Harcus-Krakow, Boston; Ruth Braunstein of Quay Gallery, San Francisco; Richard Gray of Gray Gallery, Chicago; and Meredith Long of Meredith Long & Co., Houston—was considerably livelier than the morning’s, and of greater interest to contemporary artists.

    Karp, in flame-red open-necked shirt and black leather jacket, a well-calculated contrast to the banker’s attire of his colleagues, began with a lament on the dearth of big-spending collectors while a wealth of exciting new art fails to sell, which brought howls of laughter and appreciation from the audience. Rubin, of Knoedler Gallery, and Emmerich said they found no exciting new art beating down their doors. There was also disagreement about the number of collectors, but it was clear from the discussion that there is a lot of money and art activity in what Castelli, with a wave of his hand toward the out-of-towners, referred to as “the provinces.” He said he himself is looking for “stars, not activity.”

    Ms. Braunstein noted that the New York dealers on the panel, except for Karp, are the “establishment,” so that perhaps little exciting new work comes to them. She said she finds much thrilling new work with new materials. She also asked Esterow why there were so few women participating, which drew applause from the audience, particularly the press section, which was predominantly female. Esterow was ready for that: “25 percent of art dealers are women; two out of eight panelists equals 25 percent.” (However he wasn’t quite so careful introducing the panel, having named first all the men in order down the table, and then the two women seated among them. It also bears noting that no woman artist was mentioned by name in the entire day, though Karp did use the phrase “his or her artistic temperament” to indicate that the artist is of two possible sexes.)

    The dealers seemed to agree that their major function is educational, as big sales are few and far between. All day there were pious protests from speakers that one would not, heaven forbid, speculate in art. Castelli finally reminded his fellow dealers that such folk do exist.

    The discussions would all have been more relevant and informative if moderators Esterow and Donald Goddard, managing editor of ARTnews, had asked better questions, or been more alert and articulate, or allowed some exchange with the audience. Nevertheless, Castelli’s reminiscences of the ’60s, when he was a kingmaker, were colorful; Rubin’s and Emmerich’s snobbery was piquant; Karp was hilarious, irreverent, and delightful, as when describing the “Hirshhorn Waltz”—an embrace from Mr. H. at the conclusion of a bargaining session. (All agreed that Joseph Hirshhorn was a keen bargainer.)

    What did the audience, exceeding in numbers [greater than] the sponsors’ fondest hopes, get for their tax-deductible $200? A simulated leather portfolio, suitably inscribed, crammed with promotional material for the New School and Parsons (now part of the New School), literature about New York City museums, advance copies of ARTnews, and, of course, ARTnewsletter, which, begun one year ago, circulates to one thousand dealers and collectors. A catered buffet, where perhaps the concrete information about investments and the market not coughed up by panelists and speakers was exchanged off the record. And a glimpse of the movers and shakers of the art market world.

    What did the sponsors get? $80,000 less costs. A lot of promotion with collectors and dealers, and, potentially, in forty-three organs of the press. Confirmation that there is indeed a lot of money “itching” to be spent on art, although perhaps not much in New York as there used to be. And proof that there are a lot of people itching to make money off the people making money off art.

    In Terms Of count: unknown.

    Source

    Written by Lynden B. Miller, “Speculate in Art? Not Us!” was originally published as “Art Business at the New School: World Art Market Conference” in Women Artists Newsletter 2, no. 7 (January 1977): 1, 4; and reprinted in Judy Seigel, ed., Mutiny and the Mainstream: Talk That Changed Art, 1975–1990 (New York: Midmarch Arts Press, 1992), 47–48. In Terms Of thanks Midmarch Arts Press for permission to republish this review.

  • What Price Art? A Market of Mirrors

    The paper [by Alexandra Anderson-Spivy] excerpted below, an explanation of how to “make a market in a living artist’s work,” was a highlight of the [“What Price Art?”] conference. Further details appear in Ronald Feldman’s truth-in-jest advice later in the year.

    “What Price Art? A Market of Mirrors”
    Friday, April 26, 1985
    What Price Art? The Economics of Art: An Agenda for the Future
    New York University, Graduate School of Business Administration, New York

    The art world in the 1980s at Mr. Chow (photograph by Michael Halsband)
    The art world in 1985 at Mr. Chow (photograph by Michael Halsband)

    Art is a conveyer of status, a vocabulary of power. Men and women of wealth and influence, after they have acquired their money and power, need signs and symbols of their importance. Collecting art is often a way to gain entry into a desired social stratum….

    How do dealers “make a market” in a living artist’s work? With virtually any new painting commanding an entry gallery price of $1,200 to $2,550 (sculpture begins a bit higher), there are price thresholds that a new or unrecognized artist must break through as he or she goes up the ladder. Assuming the dealer truly believes in the quality of the work, he [sic] must publicize this belief through exhibitions, critical reviews, word-of-mouth….

    Dealers try to get their artists’ work seen by museum curators [and get] well-known, serious collectors to buy. Many galleries will only release works by certain artists to certain collectors, recognizing the Doppler effect of those collections. These collectors are also likely to be on museum boards and to encourage recognition of artists they favor at those institutions. Ten percent or 20 percent discounts [or more] off quoted prices to valued customers are common. (I have heard it rumored that some sales are made at up to 80 percent off quoted gallery prices.) Sales to museums at far-below-market prices will permit the dealer to jack up subsequent prices. The aura of market activity can also enhance an artist’s reputation and build market interest. There is a high risk-high reward factor…. Collectors respond to the idea of buying a hot young artist’s work at prices which will escalate rapidly. The idea of investing in contemporary art is rather new, and one which reputable dealers claim they do not use as a sales tool. But the media attention given such artists makes that kind of hard sell almost unnecessary, since speculation becomes a tacit factor in everyone’s mind.

    About three years ago, I noticed a brand new painting by Jean-Michel Basquiat hung in the loft of a famous artist. He said, “This time I wanted to get in at the beginning. I’m tired of seeing the collectors make all the profits.” In three years, Basquiat’s prices have risen precipitously. Sales to major collectors also build an artist’s image and thus allow his prices to rise. Once an artist’s reputation is established, the auction house may play a part. Sales at auction are not only important exposure … they publicly ratify prices. Dealers have been known to put up a work at auction and buy it back themselves simply to establish a price…. If works are “bought in” (i.e., do not reach their reserve price), a certain superficial credibility of price still remains to the public at large. However, savvy collectors who follow auctions closely may then consider a picture “burned,” thus making it harder to sell subsequently….

    Because the “value” of a new work is in fact so much a matter of opinion, those who wish to participate in the game soon discover that becoming an insider, i.e., having access to the informal as well as the formal network of information about the art, is crucial…. In the oddest way, works of art achieve value because certain individuals in certain sectors of the system decide they are valuable, but much of what goes on goes on behind the scenes…. An artist whose production is very small or who shuns the publicity machine [may not achieve] “brand name” status. [Yet] in the long run … mediocre pieces bring mediocre prices and great works bring ever-greater prices.

    warholbasquiatboxing
    Andy Warhol and Jean-Michel Basquiat (photograph by Michael Halsband)

    Another market factor is the “auction ring.” A group of dealers interested in the same material agree not to bid against one another, assigning one to bid unopposed. After the sale they reauction the things among themselves. [This] is strictly illegal. But, when done skillfully, it is almost impossible to uncover. Auctions have also been manipulated in another way. Dealers bid up prices of their own artists even if they themselves have to buy the work. Then they call claim the auction price as ratifier of prices in the gallery. Or it may be arranged in advance to have people (assigned to go up to a certain price) bid on a work, thus pushing up the price.

    In recent years, auction houses have attracted a much wider public, often competing with the dealer for the collector’s dollars, so that antagonisms between the two have surfaced. Large advertising budgets, increasing media publicity, glossy catalogues, and an aura of theatrical glamour attract high rollers to the auction rooms (recently refurbished) of Sotheby’s and Christie’s. [R]ecord-breaking prices are touted widely, while heavily bought-in sales are played down whenever possible. Auction houses have learned how to use the tools of modern marketing. Michael Thomas, a former investment banker, in a column about the forthcoming Sotheby’s sale of pictures owned by the late Florence Gould, [wrote that] “advance publicity would have us believe that the equivalent of the Jeu de Paume or the Phillips Collection are being disgorged at auction, but by and large … the pictures are pretty and accessible, just the kind of thing with which rich Arabs like to decorate their Home County mansions.”

    The combination of hype to create demand that takes advantage of ignorant, cash-heavy, status-hungry consumers of art is hardly a new one, though it may operate more widely and efficiently than in the days of Joseph Duveen and Bernard Berenson. Policies of full disclosure for critics, scholars, and curators (to reveal any vested interest in art they write about or curate) and for dealers and auction houses might go a long way towards correcting the abuses of the art market as we know it. Meanwhile, caveat emptor remains sound advice.

    In Terms Of count: 0.

    Source

    Written by Alexandra Anderson-Spivy, “What Price Art? A Market of Mirrors” was originally published within Cynthia Navaretta’s “Conference: What Price Art?” in Women Artists News 10, no. 4 (June 1985): 5; and reprinted in Judy Seigel, ed., Mutiny and the Mainstream: Talk That Changed Art, 1975–1990 (New York: Midmarch Arts Press, 1992), 237–38. In Terms Of thanks Midmarch Arts Press for permission to republish this review.