COMMENTS ON THE ART MARKET
While my kids love riding roller coasters, I, for one, get sick to my stomach just thinking about them … and August’s ride on the Stock Market Roller Coaster had a similar effect on me. Watching most of this year’s paper gains vanish in a few short days made me wonder why I got back on the ride … guess it is that need to increase one’s ‘net worth’ that drives most of us to climb back into our seats and go for it. Of course, by the end of the month, some of those paper gains had returned, but 40% of them are still M.I.A. … I think they, along with my lunch, flew out when the car, on the Giga-Coaster we were riding, hit one of those double corkscrews. I figure they are now hanging out with my television’s remote control – somewhere in the fourth-dimension!
I do not know about you, but I am getting really tired of hearing that because one or two companies have reported bad results for a specific quarter that an entire sector of the market is going to be down … even though the week before other companies in that sector reported good numbers. I have finally realized that the market’s memory is an extremely short one … almost non-existent. And isn’t it funny how we talk about ‘The Market’ as though it were a living, breathing, thing? When was the last time you went out to dinner, or had an intimate conversation, with ‘The Market’? I haven’t! Let’s face it, those 20 plus point swings, in a specific stock, in 1 week, are making some people a great deal of money; I just wish that some of us, the small investor, could get in on that action.
On the brighter side, when it comes to the art many of us own, we can all agree it is very comforting to know that when we wake up in the morning and turn on the television, nobody is telling us that one, or some, of our paintings missed their “whisper number” by a penny or two and are going to take a pounding that day. We can just sit back and enjoy our art without hearing about its impending decrease in value, or the possibility that someone is going to make a hostile takeover attempt, or ‘take it private’, and we will lose one of our prized possessions to some private equity firm.
Over the long run a diversified portfolio of high quality stocks and/or art will bring its owner a good return … however, the ability to visually enjoy your art is a benefit you can almost never derive from your stocks – unless you decide to frame and hang the certificates in your living room; but who even gets their certificates today? All I get is a statement from my broker with a bunch of symbols and dollar amounts -- which are as predictable as the weather.
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Beer Bonanza
I know, you are thinking what does beer have to do with fine art? Well, nothing really but it does make for interesting reading. I first read about this story in Antique Week and concerns a full bottle of Allsopp’s Arctic Ale, brewed in 1852, which went up for sale on EBay in June. There was a brief description of the piece and it was noted that a handwritten letter from one Percy Bolster, dated 1919, would accompany the item.
The bottle caught the eye of two individuals and sold for $304 to ‘Collectordan’ … not a bad price for an old bottle of beer, but that isn’t the best part.
The new owner had a hunch and decided to research its history. He was able to determine that this particular bottle was more than likely part of the provisions taken by Sir Edward Belcher on his 1852 search for Sir John Franklin and his crew who never returned from their 1845 expedition to find the Northwest Passage. Sir Belcher’s attempt to find Sir Franklin was unsuccessful and he returned to London two years later (remains of Sir Franklin’s expedition were discovered on a later voyage by another explorer).
On August 2nd, the new owner decided to put the bottle back up for sale on EBay and this time included a complete description of the bottle’s history and the fact that it is one of the oldest surviving unopened bottles of beer in the world. He also included the contents of the handwritten label which stated the following:
This ale was specially brewed and bottled in England, in 1852, for Kane’s Expedition in search of Sir John Franklin. A portion of the lot was cached in the Arctic; and was afterwards taken back to England, where it was bought by Allsopp, from whom Mr. Jus. Fennell obtained a part.
This bottle was given to me by Mr. Fennell May 13, 1919. Should I depart from this (by that time probably) dry world before consuming the contents, let my son and brethren perform my duties and enjoy my rights in that respect, on the eve of my funeral (if they find it in time) – unless such act be then illegal, in which case those of the aforesaid trustees who sufficiently learned in law shall advise ac-??? To the rule of ey fares.
Two bottles of this ale were guests of honor at the banquet given to Shackleton and Peary, in Boston, some years ago. (1907/1908) The skeletons of said guests were preserved as mementos of Sir John Franklin! (Useful suggestion regarding the “cast off shell” of the spirit.)
Signed: Percy G Bolster
What ensued was a fierce bidding war with over 150 bids placed by some 60 individual bidders; and when the clock ran out, the new owner had paid just over $503,000 for this old bottle of beer! WOW, talk about a return on the investment.
I will say that the whole thing sounds a bit bazaar to me. How could anyone pay half a million dollars for an old bottle of beer? Come on … that is not only stupid and crazy, but beautifully illustrates the term: conspicuous consumption. Hey, should the new owner decide to go on television and drink the contents then we could really see some conspicuous consumption!
Please keep in mind that at times these ‘record results’ on EBay turn out to be bogus and since these are really private transactions there is no way to determine if the deal was ever consummated. What we do know, from the bidding results, is that there were numerous potential buyers between $100,000 and $500,000. Regardless of the outcome, you have to agree, it makes for some interesting reading.
As a follow-up, On August 25th I checked EBay to see if there were any other bottles of Allsopp’s Ale for sale and found an 1875 bottle, still full, that was brewed for the Arctic Expedition of that year. When the sale ended, this 132 year old bottle, sold for $2,550; and interesting enough, the buyer was Collectordan … the seller of the 1852 bottle. I have always said that the period in which a work of art was created has a great impact on its price … guess the same holds true for a bottle of beer.
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Thought some of you might find this site of interest:
Beauty & Elegance - Crafted in New York
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Selling Your Lower Priced Works at Auction
Just Got More Difficult and Expensive
These stories have appeared in a number of trade publications recently and I thought that many of our readers would find them of interest.
Recently Sotheby’s announced that by the end of 2007 it would close its Olympia sale room in London and no longer offer items with a value of less than £3000, or $5,000 in the US. On top of that, Christie’s announced that while they will continue to offer less expensive works, they will now charge a buyer’s premium of 25% on the hammer price of the first $20,000 for each work sold … I wonder how long it will be before the other auction rooms follow suit? To make matters even more difficult, Christie’s has also raised its seller’s commissions in Paris and Amsterdam to 15% … I wonder how long it will be before the 15% is instituted world wide?
If you think about it, when someone wants to sell a work in Paris or Amsterdam that is valued at under $20,000, the auction room will make somewhere between 40% - 45% (25% buyer’s premium, 15% seller’s premium, 1.5% insurance charge, plus the costs for photography … which they are now calling “marketing fees”). I do not know about you, but it does seem like a large percentage of the sale’s price for a firm that does not actually own the merchandise they are selling … remember, almost all the items sold at auction are consigned; not to mention that the buyer receives very little in the way of guarantees for the items they are buying.
In the boom times, these big players want to forget about the little guy. At some point the top end of the market will come to a screeching halt and they will all be scrambling to win back those they have cast aside; the sad thing is that when that time comes, all those who were left by the roadside will come back.
Howard L. Rehs
© Rehs Galleries, Inc., New York –September 2007
Gallery Updates: Please note that for the month of September the gallery’s hours are Monday – Thursday 10 am – 5:30 pm and all other times by appointment.
This month works by Blanchard, Balink, Cortes, Laloue and Giannini made their way through the gallery.
Web Site Updates: We have added, or will be adding, works by the following artists to our web site this month: Jean B.C. Corot, Daniel Ridgway Knight, Alfred de Breanski, Edouard Cortes, Antoine Blanchard, Sally Swatland, Holly Banks, and Gregory Frank Harris.
Next Month: I am still open to suggestions.