I hate to rain on the “art seems the only safe bet for investors right now” parade, but anyone who thinks a lot of post-war and contemporary artists aren’t over valued needs to consider just how much a Warhol painting sells for relative to its long term investment potential. Annie Deakin at the Independent clearly hasn’t read Todd Gibson on this subject, and apparently, neither have all the people in “exhibition halls” who think “Art is the new gold”. He goes through a fair amount of numbers in his two part series, but by the end he wisely points out that most art purchases only barely keep up with the cost of inflation. I hate to say it, but I find the idea that people might find art a more secure investment frightening. Obviously I want artists and galleries to do well, but I haven’t much cared for the results of the housing bubble. The thought that the art might represent something similar sounds like a disaster waiting to happen. If you ever thought there was animosity directed towards the art community, imagine how bad it would be if the global market considered it a stable commodity only to have the bottom fall out.
UPDATE: Economics blogger Felix Salmon responds noting that Annie Deakin is the acting editor of mydeco a website selling “home furniture and interior design: beds, sofas, curtains, paint, wallpaper, tables and chairs”, as well as “art photography prints”. Deakin isn’t likely to be impartial, but Salmon also observes that nobody is.
He goes on to dispute Deakin’s assertion that art like gold is “reassuringly tangible” and therefore a good investment,
…There are lots of things which are “reassuringly tangible”. Gold might be one of them — although at $788 per ounce today, it’s no longer twice the price it was four years ago, and it’s fallen by more than 20% from its highs. Other reassuringly tangible things might include stuffed animals, hardback books, and chopped wood. Being reassuringly tangible doesn’t make anything a store of value: it just makes it stuff. And, just like other stuff, 99% of art will never again be worth the money that was paid for it.
In the case of the art on sale at mydeco, you can reasonably make that 100%. You might absolutely love your window roller blind with a picture of cars on it, but it doesn’t have any resale value.
Very well put. One final observation on the subject; mydeco.com‘s tagline Art For All, sounds remarkably similar to 20×200‘s “It’s art for everyone.” I suspect that’s not an accident, and I don’t know how happy I would be about it were I Jen Bekman.