Panorama view of exhibition in Jedlitschka Gallery, Zurich.

Panorama view of exhibition in Jedlitschka Gallery, Zurich.

10 December 2013

Collectors Wanted, Students in Excess, Pulling the Line (The Intrepid Art Collector)

Originally posted October 11, 2006



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The comments by Bill Dolan, Newbie and others on The Shark's previous post may have swerved away from his point, but they raised an intriguing issue — the pressure on artists caused by simply having to make a living. This discussion reminded me of a fascinating blogsite, and a post on it. The site is called
"The Intrepid Art Collector."

It is by Lisa Hunter. Her mission is to create, encourage and assist new collectors. A worthy cause and she does it with panache on her enjoyable and readable site.



Lisa Hunter describes herself, saying, "I'm a former New Yorker now based in Montreal. My theory is that the day you realize everything in your wardrobe is black and everything in your apartment is white, it's time to leave Manhattan." She continues, " Have questions about the art market? Email me!" A brave statement, if there ever was one.

In my opinion, there are more than enough artists, there are many, many struggling galleries, what we need are far more collectors — and perhaps thereby a whole new world of more varied support for the arts, encouraging individualism instead of consensus in curators. Lisa has written a recently released book also titled The Intrepid Art Collector, about how to collect art. As she says of it " I wrote this book because when I was first starting to collect, I couldn't find any books to help me. Each type of art has its own quirky criteria that determine authenticity and value, and each has its own notorious fakes. I hope that with this book, you can learn in a couple of hours what took me a decade to learn. Art collecting is one of the most rewarding hobbies you can have. I'd like to help you get started."

There is a short interview with Hunter at another blogsite called Kate's Studio. One statement from Hunter will intrigue Chicago artists, especially of the Shark variety. Discussing the "hot" art scene in LA, she says " What LA artists did brilliantly was cultivate local collectors and not worry about the East Coast. In so many other cities, artists and collectors fail to connect because they're both too focused on New York as the only "real" art market." Some words to study closely, especially for my grade-B--NYC-copyist "friends."

The post through which I first became aware of Hunter's site and the one which has bearing on the comments mentioned above, is titled "Where does all the money go?" It makes a breakdown of the typical expenses of a recent art school graduate, beginning with the "cost of a Yale MFA — (tuition plus the “average student budget” for housing and expenses): $92,000. IF you finish in the minimum two-year timetable" — continuing through the cost of health insurance, (oh, that's right due to the infinite wisdom of our compassionate Neo-Cons, the US has almost no health system, I forgot,) — all the way to the cost of a business class ticket to the Venice Biennale — $5,900. Fun reading, ending with the "Schadenfreude that "non-hot" artists feel when collectors lose big money chasing art stars: priceless."

Of course, this last comment must be taken in context, for Hunter is absolutely pro-collector, simply having a little fun at the expense of those who neither think for themselves nor follow their own passions.

Check out her site and her book. They are worthwhile.

A few other facts about art-graduate life, not from Hunter's blog:

A degree in an arts subject reduces average earnings, a study shows. Graduates in these subjects - including art and literature - can expect to make between 2% and 10% less than those who quit education at 18, researchers at Warwick University found.

It is only the art professors who make out okay in the world of higher education, with jobs that give them the flexibility to engage in their own creative pursuits while enjoying the advantage of a reliable income and benefits. The students who do not become teachers fare far worse, with a miniscule percentage still making art 5 years after graduation. Don't forget that I, your Ex-Pat Shark, am, from time to time, one of these professor-types, thus am not decrying the job, everybody's got to have one — however, these facts mean the art education system exists primarily to create art students, not artists, even though more MFAs leave US art schools per year than there were artists as a whole in Renaissance Florence.

Within 10 years after graduation, on the average more than 99% of art graduates no longer make art at all — not just are not successful, but do not make art at all.

What are we creating here? Where should it go? Is it any surprise that there is a hidden classism in the artworld? Do we really need so many people trained in (the theory of possibly producing) art?

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Comments (4)

Thanks for the kind words. And I'm delighted to know about Sharkforum.

Mark, a little tid bit I gleaned from the net awhile back that portrays the downside of collecting art. Thought you might find it interesting.



Art Is Among Worst-Performing Investments, Merrill Lynch Says July 19 (Bloomberg)
Art is one of the worst ways for investors to try to make money, even as paintings by Picasso and Klimt sell for more than $100 million apiece, according to a Merrill Lynch & Co. study.



While stocks or bonds are almost certain to make investors a profit over five years, art has a high chance of declining in value, the world's biggest brokerage company said. The probability of losses on small-cap stocks, corporate bonds and long-term treasury bonds is 3 percent or less if they're held for five years. Art investors have a 17 percent chance of losing money over five years, Merrill said.



Soaring prices for art stirred interest from banks and dealers in 2004, when about 12 art funds seeking to raise as much as $150 million were planned. Only one or two, including London's Fine Art Fund, ever got off the ground. Merrill's investment strategy report, dated July 17, helps to explain why. "Art, gold and commodities offered the least attractive risk-reward potential, providing inferior returns while generating substantially more risk,'' Merrill said. The three asset classes "may be more appropriate investments for those who have truly long-term horizons,'' it said.



Merrill's study uses data on returns going back to 1969 for most assets and to 1976 for art, provided by index-maker Art Market Research, which tracks auction prices. Merrill aims to show that most investors do better if they hang on for three years or more, while many day traders and short-term investors lose money.
Klimt Purchase
Modern art prices have more than doubled since 1998, and some contemporary price indexes have trebled in 10 years, according to Art Market Research. Broader measures of the art market haven't fared as well and modern and contemporary prices are being buoyed by a narrowing group of the most expensive paintings, the indexes show. Ronald S. Lauder, the cosmetics magnate, made headlines in June when he paid $135 million for a Gustav Klimt portrait in a private transaction -- more than any painting has ever fetched at auction. The top auction prices are a Pablo Picasso work that sold for $104.2 million in 2004 at Sotheby's in New York, and the same artist's portrait of his mistress, "Dora Maar au Chat,'' which fetched $95.2 million at a Sotheby's New York auction in May. Philip Hoffman, who runs the Fine Art Fund, said he's made big profits by selling paintings within a year or so and aims to expand. However, he has never officially disclosed the size of his fund, or which paintings he sold.
Gold Tops 1970s
Art has done worse in some decades than in others. In the 1970s, art had the lowest 12-month return of eight asset classes and the highest chance of losses, Merrill calculated. Gold was the best investment in that decade, outperforming stocks and bonds with less risk. Art swapped places with gold in the 1980s, doing better than stocks, bonds and real estate. In the 1990s, art was again a loser, only a little ahead of commodities and gold, which racked up 12-month losses more than 50 percent of the time. Standard & Poor's 500 shares were the best investment.
Real estate and small U.S. stocks are faring best in the current decade. Art, foreign stocks and S&P 500 shares are the worst performers, Merrill's charts showed.
Linda Sandler, Bloomberg.com

Which basically gets back to Hunter's approach --- building new collectors from those INTERESTED in the arts, not seeing it only instrumentally. And then those people becoming knowledgeable, then finding, buying and appreciating fine art; buy what you love, and the investment aspect works, but only as a nice, secondary long-term dividend.

Kevin,
I thought the Merrill Lynch study was seriously flawed by limited data. I had a post about it last summer. If you're interested, "When Bearishness is Bull" is in the July archives of my blog.




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