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Billionaires Gone Wild: Why a Globalization-Fueled Art Bubble Spells Trouble For You and Me
http://www.alternet.org/economy/globalization-and-art-bubble
***SNIP
Bubble Trouble
You may say that big art sales are a good thing — artists have to pay their bills, and so do curators, gallery workers, museum professionals, and others involved in the show. But there are several signs that the art world is in a bubble that could burst not only in the faces of those folks, but the rest of us, too.
Felix Salmon of Reuters and others suggest that the art market is now reaching a dangerously speculative bubble stage, and you can tell because people are starting to flip out. Art-flippers like hedge-fund billionaire Steven A. Cohen (recently nailed for insider trading), appear to be in the process of unloading big works of art on the assumption that it’s time to get out of the market. That would make the current buyers feel like suckers if and when the bubble bursts, and it would wreak havoc on folks whose jobs depend on art sales.
But there’s something more. A couple of days ago, the legendary short seller Jim Chanos, who makes his money by spotting overvalued stocks, warned investors that they may need to be a little cautious right now — and if you have a pension or a 401(k) plan, this means you, too.
He points out that a sharp rise in the stock of Sotheby's has historic correlations to peaks in the stock market in general.
When there’s excess in the marketplace, he notes, Sotheby's stock often moves from about $10 to $50, then collapses. On Tuesday, November 19, Sotheby’s was trading on the New York Stock Exchange at $51.96, up substantially from $34, where it started in 2013.
1 replies
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http://www.newyorker.com/reporting/2013/12/02/131202fa_fact_paumgarten
Zwirner at home, with a painting by Raymond Pettibon. “Nobody’s selling expensive stuff like we do with the frequency we do,” Zwirner said. “This is an industry in its golden age.” Photograph by Pari Dukovic.
VVery important people line up differently from you and me. They don’t want to stand behind anyone else, or to acknowledge wanting something that can’t immediately be had. If there’s a door they’re eager to pass through, and hundreds of equally or even more important people are there, too, they get as close to the door as they can, claim a patch of available space as though it had been reserved for them, and maintain enough distance to pretend that they are not in a line.
Prior to the official opening of Art Basel, the annual fair in Switzerland, there is a two-day V.I.P. preview. In many respects, the preview is the fair. It’s when the collectors who can afford the good stuff are allowed in to buy it. After those two days, there isn’t much left for sale, and it becomes less a fair than a kind of pop-up museum, as the V.I.P.s, many of whom have come to Basel from the Biennale in Venice, continue on, perhaps to London for the auctions there. The international art circuit can be gruelling, which is why pretty much everyone who participates in it takes off the month of August, to recuperate.
The Basel preview began at 11 a.m. on a Tuesday in June. The meat of the fair was in a gigantic convention center on the east side of the Rhine. The dealers’ booths were arrayed along two vast rectangular grids, which enclosed a circular courtyard that resembled a panopticon. The fair occupied two floors. The bottom one featured blue-chip art, offered by the powerhouse dealers; Picassos and Warhols could be seen among more contemporary work. Upstairs, for the most part, was younger work, exhibited by smaller galleries.
On the morning of the preview, after a champagne breakfast in the panopticon, the V.I.P.s gathered at the doors, under the watchful eye of guards in berets and dark crewneck sweaters. Through a window in the door, you could see, down the hall, the dealer David Zwirner, with his sales staff huddled around him, as though for a pep talk. The Zwirner booth was just past the Fondation Beyeler’s. (The Swiss dealer Ernst Beyeler, who died in 2010, was one of Art Basel’s founders and its presiding spirit.) Zwirner comes in force: he had about a dozen salespeople with him, a mixture of partners, directors, and associates, as well as a platoon of assistants and art handlers. A few minutes before the doors opened, they took up positions in a sales-floor spread defense. Bellatrix Hubert, a Zwirner partner, pantomimed a gesture of being slammed by an incoming flood. The doors parted, and the buyers poured in.
Zwirner at home, with a painting by Raymond Pettibon. “Nobody’s selling expensive stuff like we do with the frequency we do,” Zwirner said. “This is an industry in its golden age.” Photograph by Pari Dukovic.
VVery important people line up differently from you and me. They don’t want to stand behind anyone else, or to acknowledge wanting something that can’t immediately be had. If there’s a door they’re eager to pass through, and hundreds of equally or even more important people are there, too, they get as close to the door as they can, claim a patch of available space as though it had been reserved for them, and maintain enough distance to pretend that they are not in a line.
Prior to the official opening of Art Basel, the annual fair in Switzerland, there is a two-day V.I.P. preview. In many respects, the preview is the fair. It’s when the collectors who can afford the good stuff are allowed in to buy it. After those two days, there isn’t much left for sale, and it becomes less a fair than a kind of pop-up museum, as the V.I.P.s, many of whom have come to Basel from the Biennale in Venice, continue on, perhaps to London for the auctions there. The international art circuit can be gruelling, which is why pretty much everyone who participates in it takes off the month of August, to recuperate.
The Basel preview began at 11 a.m. on a Tuesday in June. The meat of the fair was in a gigantic convention center on the east side of the Rhine. The dealers’ booths were arrayed along two vast rectangular grids, which enclosed a circular courtyard that resembled a panopticon. The fair occupied two floors. The bottom one featured blue-chip art, offered by the powerhouse dealers; Picassos and Warhols could be seen among more contemporary work. Upstairs, for the most part, was younger work, exhibited by smaller galleries.
On the morning of the preview, after a champagne breakfast in the panopticon, the V.I.P.s gathered at the doors, under the watchful eye of guards in berets and dark crewneck sweaters. Through a window in the door, you could see, down the hall, the dealer David Zwirner, with his sales staff huddled around him, as though for a pep talk. The Zwirner booth was just past the Fondation Beyeler’s. (The Swiss dealer Ernst Beyeler, who died in 2010, was one of Art Basel’s founders and its presiding spirit.) Zwirner comes in force: he had about a dozen salespeople with him, a mixture of partners, directors, and associates, as well as a platoon of assistants and art handlers. A few minutes before the doors opened, they took up positions in a sales-floor spread defense. Bellatrix Hubert, a Zwirner partner, pantomimed a gesture of being slammed by an incoming flood. The doors parted, and the buyers poured in.
