Art in crisis
Despite the glitzy image of the art world and the record breaking prices that hit the news in the past year, behind the scenes, the art world is suffering from a crisis in terms of values and economy. Contradictions are inherent in this topsy turvy world. A small number of high end sales do not reflect the reality.
How shall a wolf dwell with a lamb? So the bible asks. The wolf represents the art market and the lamb represents the purist approach of art for the sake of art. How, indeed, can they dwell together?
There is an inherent dissonance between the two concepts– Art and Money. But these are the main inseparable constructs of the art world today.
Since the economic crash of 2008, after which a correction of market prices was expected, not only did the art market recover but it gained strength. Paradoxically, the crisis itself and the loss of faith in the financial system increased the attraction of art as an alternative investment that also provides social and cultural capital. New players entered the market – business men who made fortunes in other fields and investors with interests and the power to promote certain artists. The major players of the art world are mega gallerists Larry Gagosian, owner of 12 galleries worldwide, Jay Jopling, owner of 3 White cube galleries – who together with others have the power to turn any artist they put their hands on into a gold mine. Artists such as Damien Hirst and Jeff Koons, with capital estimated in millions, continue to create controversial art despite its high prices. Art fairs and art auctions – mainly Sotheby’s and Christies propel the financial engine of the art market.
This situation has become unbearable for art critics of the academic/purist kind, who represent an elitist approach.
The first to give voice to her disgust from the situation was Sarah Thornton, author of “7 days in the artworld”. Thornton, a sociologist and art critic, published an article titled “10 reasons not to write about the art market” in which she complains that contemporary art criticism gives credit to artists that don’t deserve it and is subject to manipulations of speculative collectors. Prof. Dave Hickey, a curator and critic also thinks that the artworld has become “calcified, self-reverential and a hostage to rich collectors who have no respect for what they are doing.”
Can critics’ protest change the situation? Probably not, considering arts strong status as a financial asset. But there is another distortion that deserves thought. Contemporary artists are still creating and this has two implications: 1. Their place in the history of art is not yet secured. 2. Quantity reduces value. That may be the explanation for the decline in prices of Damien Hirst, who flooded the market between 2005-2008, the peak being an auction dedicated to his works and fetching 200 million dollars on the day that the Lehman bros. declared bankruptcy. Now figures are showing a devaluation of 30% for his works, some of which don’t sell at auctions.
One must bear in mind that the mega art sales are only the tip of the pyramid. The wide base of the artworld portrays quite a different picture of artists and galleries that are having difficulties supporting themselves from art sales.
Amy Cappellazzo , head of Christies post war and contemporary department once said that the real value of an artwork is determined in the secondary market. This is probably what the purchasors of Damien Hirst are realizing nowadays, as they find it difficult to sell the work, let alone making a profit.
There is a lot of talk about the art bubble bursting. It has happened before, when much less was at stake, and the market always recovered. In times of insecurity it is always recommended to invest in artists that have proven themselves over time. Remember that the popularity of art attracts charlatans. Read and learn about the artists you are interested in. Knowledge really is power when prices are high. Read these tips for the investor and take notice especially of the last one – buy art that you love. Art has been proven as a long term investment. In the meantime you can enjoy living with it! Remember that art is a special kind of asset – it is a piece of culture and should be preserved and cared for, regardless of its price tag.