Let us recall that all prices, as well as values, are arbitrarily assigned, regardless of whether we’re discussing sugar, pez dispensers or fine art. Value is not inherent in anything. The collective determines value and translates it through pricing when a thing is exchanged for money or rent or a side of deer. Isn’t life wonderfully simple when you make it so?

The “health” of a market (of stocks, houses, paintings by Monet) can be gauged temporarily, fleetingly, by observing the MOST RECENT TRADE. For example, when the NY Stock Exchange opens with GE trading a buck lower than the previous day, that is it’s current price for all GE shares, determined by as few as two participants trading one share. All the millions of individuals and institutions who also own GE don’t have to do a thing, and the price (again, perhaps not the underlying business value) of THEIR GE stock has fallen. Same with art at auction.

Sure, maybe some people are swapping Renoirs and Fra Angelicos for pieces of eight in the back of flea market tents in South Jersey, but it’s doubtful serious collectors or museums would call that a sign of a healthy market.

And, yes, probably all markets are jiggered somehow at some point, so buyer beware!”

Keep going! You’re getting close!

Thanks for the comment. I totally agree with everything that you have said especially the bit about the auction rooms being full or art speculator as opposed to art lovers. Unfortunately so true…

Nick

I love your letter! I love your youth and enthusiasm for what is essentially a corrupted marketplace! It is not only the art auction rooms that reflect the current state of the marketplace but also the stock market, antique sales and residential markets.

During my life as an artist (first love and continual thread of my life), but also as an economic development consultant to government (had to do this as well to keep bread on the table for family)….. ah yes, a short 40 troubled yars based around money and art…….I have come to realise that the most true words that were ever given to me were by a dealer…….

He said “A thing is only worth what the buyer is willing to pay on the day!” It has taken me another 20 years to understand the full implications of that statement.

Perception is indeed a powerful motivator and if Damien Hirst can get a buyer to perceive that his ‘dead cow’ is worth $22 million, then on that day and for that moment, it is worth it! That is the art of Damien Hirst! Not the cow, but the ability to make a market believe!

Graziers if confronted with a dead cow, even with formaldehyde and golden hoofs, would find the idea ludicrous! Do you know how many cows farmers have to burn and bury in their paddocks daily across the world? But their not artists so the perception is that their dead cows are worthless!

And does it matter? Well yes, indeed it does, really….. we now live in times where commonsense has been replaced by greed! where investment has been replaced by speculation! Where celebration of the ordinary is heralded as a great thing and anything that has taken time, patience and learning is derided as ‘old fashioned’!

The auction rooms are full of not ‘art lovers’ but speculators! Oh I am sure that there are one or two genuine art lovers in the room, but for the most it is people who just want to make a quick buck! Dealers, gallerists, investors, artists themselves pushing the prices……..the art sold is often not of a high quality but is of sufficient value to look OK.

I put gallerists there as well as I have found some there buying to put on their gallery walls at a higher price.

What to do? Ah that is the question for a young man like you?

and thank you for the time, energy and love you divest in thinking about the problem……may you find a solution……

Joy