Back in pre-credit-crisis days, a very enjoyable book, Owning Art, the Contem-porary Art Collector’s Handbook by Louisa Buck & Judith Greer, gave self-help tips to nascent collectors and made art collecting sound as simple as baking hot pies. The best anecdotal advice came from New York gallerist Barbara Gladstone, “Art is not a stock and should not be treated as such… to buy art with an eye to making money, that’s a completely different thing.”
Well, by mid-2007, most of the art world, including artists, was trying to do precisely that “completely different thing”. We were no longer talking about art movements, but best-selling trends, auction values and stock sales. The global art market history will remember 2008 as a turning point when speculative euphoria in the first half fuelled hopes that art was the new alternative investment. The Mei-Moses Index (it tracks Western art auction prices since the 19th century) fell only 4.5 per cent per annum against 50 per cent falls in the financial markets. Then the harsh reality turned out quite something else for thousands of art dealers, artists and collectors in the months that followed.
After seven consecutive years of price rise, the art market finally buckled with prices falling between 35 per cent to 70 per cent. Right after the historic $230 million auction by British artist, Damien Hirst on the very day America’s fourth largest financial institution went bankrupt (of course it has now been revealed that Hirst’s own dealers had bid up for most of the items) international auctioneers have faced unprecedented failed sales.
Contemporary art is the market’s most volatile segment. Emerging markets like Asia have been hard-hit. ArtTactic’s half-yearly confidence indicator survey of 88 gallery owners, curators, collectors and auction houses on the Indian market has consistently fallen from its peak in October 2007 by more than 50 percent.
Galleries who became multi-national corporate offices are now being forced into “garage-sales”. I hate to think what that does to the confidence of the artist. Some galleries are shutting shop to become private dealerships as the gallery model itself becomes less effective.
Unless one is buying an antique, or the well-known work of a long departed master where there is hopefully a genuine limited supply (going into the debate of fakes is too depressing in these dark times), buying art is perceived as a guaranteed money loser. The flip side is that India is probably learning her lessons well. Indian contemporary artists who had moved, perhaps too quickly, from post-colonial to cutting edge global issues to meet the international market, are revaluing their role and values.
Art is primarily an intellectual pursuit, not property (though there is a correlation). The best collections have been built from a deep personal engagement from both the artist and the collector. Auction houses, price indicators, etc, try to mathematically follow the market, but there is no barometer to measure the emotional shock of discovering an emerging talent, or confronting a new experience about yourself in the painting by a senior artist who has been exploring just that concept all his life. It is about shifting society and creating change. Established collectors know that and are following their heart-strings, with probably a tighter budget string. Hopefully that is not about to change.
The writer is Global Director for Art Border Line, a UK-based organisation that advises collectors on upcoming artists from India, West Asia and Brazil.