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Director | Rehs Galleries, Inc.

A Word on Art and the Economy

Dec. 23rd, 2008 | Comments 0 | Make a Comment   
Arts & Culture: By December 23, 2008, the day I finished this article, the stock market was down 279 points for the month (with a 3277.30 total closing point swing); and just for the record, my personal portfolio was teetering at the 36% loss level for the year! So much for the old idea of INVESTING in the stock market.

Recently I have been comparing the stock market to a floating crap table, but it appears you have better odds of making money at craps; so a more accurate comparison would be slots or roulette. And if you are looking for advice on how to win, here is mine --- don't play! During my lifetime I tried my "casino" luck about a dozen times and once, while playing the quarter slots, I won over $21,000 - so while miracles do happen, I wouldn't count, or even bet, on them!! You should also know that since that win, I have never been back.

Today I like to "play" the stocks: buying another 200 shares of RIMM for 6 points less than I paid last month - you know, dollar averaging; and 300 shares of Citi. I sure hope that those bets are better than the black 8 on the roulette table. Who knows what the stock market will bring tomorrow; and since there is little any of us can do about it, let's turn our attention to the art market.

During these troubling financial times, a fair number of works showing up at auction are not finding buyers and it is my belief that the reason for this is less about their quality, and more about the quantity being offered. I will continue to stress this: there is just so much art any one market can absorb - a statement that was once again confirmed this month when the two main auction rooms, Sotheby's & Christies, offered thousands of works.

The first week started with the Marine and Sporting sales in New York and the results were no surprise to me - 553 works offered and 265 found new homes; a sell through rate of about 45% and a total take of $6.8 million - far, far below the total they were expecting. So far below that they never released the expected numbers. Among the highlights were Alfred Munnings' F.H. Prince and the Pau Foxhounds at $1.06 million and Off to the Start at $362,500; coming in third was Herring, Sr.'s The Earl of Chesterfield's Industry - at $338,500. As always, many of the works had condition and quality issues; however, in my opinion, it was the large number of paintings offered by certain artists that caused the high buy-in (unsold) percentages - 28 works by Herring, Sr. were offered (including 9 important examples), 8 by Dawson, 14 by Jacobsen, and the list goes on.

And just to rub a little sea salt on this wound, one of the auction rooms had a corresponding Maritime sale in London the following week with another 79 works - only 30 of which found buyers; a 38% sell through rate that totaled 983,475 (about $1.45 million).

Also during the first week the American sales, in New York, were in full swing; offering a mix of good and average works. Surprisingly the returns were somewhat acceptable given the current economic climate. Taking top honors was F. Silva's Sunrise at Tappan Zee at $2.66 million; the second slot was filled by G. O'Keeffe's Blue Wave Maine at $1.65 million; and in third was M. Hartley's The Silence of High Noon at $1.54 million. There were also works by Grant Wood, Hassam, Avery, Remington, Farney, Marin, Wyeth, and Garber that did very well. In the end, of the 370 works offered 218 found buyers; a sell through rate of about 59% and a total take of $46.1 million.

If you are keeping count, we have hit 1002 works offered so far and there was still more to come. What? more art!? You have to be kidding? Sorry, but I am not!

The London branches of these same auction rooms offered a series of Old Master sales that week as well. However, here the results were hot; so hot in fact that one might use the word smokin' when comparing them to the other sales!

The evening sales started with a bang and taking top honors was Canaletto's The Grand Canal at 3.85 million (about $5.7 million); second place was nabbed by van Mieris when his A Young Woman in a Red Jacket Feeding a Parrot, estimated at only 500-700,000, brought a whopping 3.63 million (about $5.4 million); and in third was an even more impressive result when da Carpi's Portrait of Bindo Altoviti (estimate 200-300,000) made 3.07 million (about $4.57 million). Of the 97 works offered, 67 found buyers (a 70% sell through rate) for a total take of 28 million (or $41.6 million).
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