Even The Rich Are Giving Up; Another Art Auction Fails

Tyler Durden's picture

How fickle are the wealthy? Six weeks after having never been happier relative to the poor, and mere days after we showed their recent collapse in confidence, it seems the rich are no longer amused by Bernanke's game. As The FT reports, for the second time in a week, an elite art auction has failed for all intent and purpose. One-quarter of the high-profile Impressionist and Modern paintings under the hammer at Christie’s went unsold on Tuesday night, signalling a bleak start for the autumn auction season in New York. The muted results came hot on the heels of disappointing sales on Monday evening for Christie’s, after the collection of the late art dealer Jan Krugier went under the hammer yet failed to dazzle. But how will the wealth effect trickle down?

 

Via The FT,

Sales from the evening totalled $144.2m – excluding the 12 per cent buyer’s premium – a figure well below the low estimate of $188m initially made by the house.

 

Twelve out of the 46 artworks on offer went unsold.

 

...

 

Observers at the evening said the combination of sky-high valuations and mixed quality had weighed more heavily on the purchasing decisions of dealers and collectors than in previous stellar years.

 

Christie’s demurred, saying it had seen an encouraging flurry of activity surrounding lots priced at the midpoint range, as well as a sharp increase in interest from bidders in China and Southeast Asia.

 

The muted results came hot on the heels of disappointing sales on Monday evening for Christie’s, after the collection of the late art dealer Jan Krugier went under the hammer yet failed to dazzle.

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zaphod's picture

"Observers at the evening said the combination of sky-high valuations and mixed quality had weighed more heavily on the purchasing decisions"

This simply means that the Rich are not stupid, not that they are running out of money.

Freddie's picture

Where the hell did Switz find so much gold?

jeff montanye's picture

from western central banks?

Suisse's picture

Stolen from Jews by the Nazis and smuggled into Switzerland. 

SmittyinLA's picture

The commies from the Soviet Union stole far more loot than the Nazis did, the NAZis were only looting in power for about 10 years, the opposition is still looting today hand over fist, they've looted more wealth than there is gold on the planet.

Ratscam's picture

switzerland is home to the biggest PM refinery companies in the world

ToNYC's picture

CYA spin; they shot the moon and came up short, no biggie. Art must fetch the magic that exists.

Loucleve's picture

How interesting.  My OmniTrader technical analysis stock program went Short on BID just tonight.  Sothebys.

scrappy's picture

Sales will pick up if they feature WB7!

lolmao500's picture

Shiat about to get real.

@L0gg0l: BREAKING - PAKISTAN ABOUT TO DELIVER NUCLEAR BOMBS TO SAUDI-ARABIA, NATO SOURCE SAYS (via @markurban01)

#Breaking RT @BBCNewsnight: Saudi nuclear weapons 'on order' from Pakistan

This will end SOOOOOOOO WELL...

dark pools of soros's picture

I heard they bought them via BMR with bitcoins

LeisureSmith's picture

Meh. The Israelis trying to scare up some dust to convince the US they have to contain Iran so SA don't have to match them mlitarily. Implying that Iran is working on nukes. That shit just stays fresh forever it seems.

The BBC peice for those so inclined. http://www.bbc.co.uk/news/world-middle-east-24823846

SmittyinLA's picture

Lol, like the Paki's owned any of the Saudis nukes.(it's just safer to store them off site till needed) Islam doesn't believe in nation states, Pakistan is a state of Saudi Islam.

 

They are to Saudi Arabia what Utah is to DC, exact same relationship.

Trimmed Hedge's picture

Hmm, perhaps I should dust off a few of the Van Gogh's before the market gets soft...

Buffy, would you be so kind to fetch my smoking jacket & slippers..?

Freddie's picture

F the rich.  The richest guy on my street - probably worth $45 million - voted for O.  He was probably the only one who voted for him.

They voted for this.   We need more boiled rope.

Sutton's picture

Modern art-greatest scam in history.

zaphod's picture

Modern art seems to mostly be a social networking thing.

Seriously what determines a "hot" modern artist, it's not their work, it seems to be more how well an artist is at networking in the right circles, adhering to the right social/political beliefs & social ladder climing with the right people.

This seems to be very similar to when there was an Aristocracy who held all the wealth/status and there were constantly useless people scraping around for large payouts (ex read vanity fair)

noless's picture

What you described is often the entire and only point of going to an art school.

There are some amazing things being done today, but I'm not sure if we're still in post modern right now, or more like neoclassical modernist revival, i honestly have no fucking clue, another thing you probably would learn at a fine arts school though..

Emergency Ward's picture

Since artists have been corrupted by the same schools as main-stream journalists, the epitome of today's modern art genre is the "Obama With A Halo" in its various permutations.

Homernomics's picture

"But how does the wealth effect trickle down?"

 

Simple, I get pissed on every day.

 

SillySalesmanQuestion's picture

My old friend Daniel used to always say "It's better to be pissed off than pissed on." I'm pissed off, but I have my umbrella out.

fonzannoon's picture

Yep the rich are running out of money. Uh huh.

PT's picture

Just running out of places to put it all and "get a return".

Banks?  Fees plus no interest.

Manufacturing?  Customers have no money.

Real Estate?  Homelessness is becoming competitive.  Businesses moving overseas.

Collectibles?  With any luck, some rich idiot from the future will choose my collectibles into which to store his left-over loot.  Coming to think of it, not everyone has to be victim here.  Imagine how one would actively manage such an "investment".  What's that saying again, "If you don't know who the patsy is ..."

StandardDeviant's picture

It sounds like a decent "alternative asset class", though, doesn't it?  Good (sometimes great) historical returns, not highly correlated with much of anything else.

Downsides would be cost of storage and insurance, lack of cash flow, poor liquidity, and high transaction costs (sorry, "buyers' premiums").

But you're right: the biggest problem is lack of knowledge, both to tell the good stuff from the bad (whatever that means in the context of modern art), and to detect out-and-out forgeries.  Makes it a pretty scary investment.

tom a taxpayer's picture

I'm not greedy and don't ask millions for my art. I'll take $400,000 for my Impressionsist Etch-A-Sketch of a black swan.

Burticus's picture

"Impressionist and Modern" = Dawg$#!+  You know, the sort of painting that makes you wonder whether it's hanging upside down or if the "artiste" was having a bad trip on LSD.

Maybe that explains it, besides rich people NOT having "more dollars than sense."

Urban Redneck's picture

The PRICE of art and its artistic VALUE are completely unrelated.

The reason(s) rich people buy art are often unrelated to either a works price appreciation potential or its artistic value.

Occasionally, however, the stars do align - and a single piece has artistic merit, a high price, a snob appeal/bragging rights... I seem have a couple of those lying around. However, in both cases it was due some "external event" years later that actually brought everything together, not something that could be foreseen at the time of purchase (i.e DUMB luck).

Caviar Emptor's picture

Oh yes all the wealth will trickle down some day! Can you feel it, brothers and sisters? Just close your eyes and feel that liquidity trickling down on you from above! Getting pissed on and jerked upon never felt so goood!

blindman's picture

i'm tired of watching the rich fuck themselves
through media exploits and dramatizations
while they eat the poor.
they are neither cute, cunning or attractive.
.
let it bleed.
.
06 NOVEMBER 2013

Gold Daily and Silver Weekly Charts - A Banquet of Consequences

"Everybody, sooner or later, sits down to a banquet of consequences."

Robert Louis Stevenson
.
http://jessescrossroadscafe.blogspot.com/2013/11/gold-daily-and-silver-w...

olto's picture

blindman,

how are you?

Sounds like a down night---too bad

What else can be done with more than six thousand million humans?

seems like some should be eaten---i mean eat other mammals, and as you point out above----humans are known cannibals-----

actually, professor wilson of harvard said that in the study of other mammal species that cannibalism was the final and most aggressive sign of overpopulation in mammalalian species (as I remember, he wrote this in his autobiography)

I find that rather interesting because it looks like we are on the edge at this moment

Anyway, I had a glass of cactus juice this evening and so, it is kind of a light night for me

I wish you well as always----and a better day tomorrow       oldman

blindman's picture

thanks. cactus juice, that sounds good.
down nights upon falling and shortening days, accumulating.
we just have to get through this decade, 7 more years.
just kidding .....
everyone i talk to is going broke and the washington
wall street bankster mob just keeps on rolling in
the securities fraud and money laundering businesses.
frankly it is depressing; the cost of insurance and
loans is criminal. etc ...
just get through this century and it will all work
out.
anyway ..

olto's picture

Thanks for the response, blindman,

Sounds like the same old song, and though

it is a downer, it is only what it is

I found something a week ago that lifted me way above these dreary clouds of our present

something in the history of this planet deeper than the dinosaurs or this ever so dark human context

I want share it with you:
http://www.youtube.com/watch?v=vxh9bpHTWGg

This will take you 250 million years back and out of this space

take care, blindman           oldman

 

BitingTruth's picture

No art sales = the rich unhappy???  Hello, McFly?  Who wants "art" when the gladiator arena is about to begin....  They are crashing the world and are so titilated they are pissing themelves....  Everyone knows Reptiles don't feel, need fear and hate, and they definitly shit on "art".

Bangin7GramRocks's picture

One word: Warhol! That freak silk screened pictures and colored over it and people will pay $100 million. Rich fucking dummies.

tom a taxpayer's picture

But, but, but...I thought Warhohl's picture of a Campbell Tomato Soup can was worth at least $100 million. If you stare at it long enough you can smell hot tomato soup and  grilled cheese sandwich. Mmm-mmm!

RaceToTheBottom's picture

Imagine what it would be worth if it was both the can and the sandwich?

 

PT's picture

What would it take for the senseless to look sensible?
How about, art as a method of laundering money?  Just a thought.

Save_America1st's picture

maybe WilliamBanzai7's art is taking a bigger bite outta the "trendy" art market than we realized...c'mon WB7...how much you bringin' in these days from those kick ass prints?! :-) 

TN Jed's picture

Sector rotation coming up.  Fine art prices have been breaking records for several years while gold has dropped to the basement mostly because there is no Central Art Bank to lease out prints.  I can only assume the fine-art/gold delta is too wide for an asset investor to ignore.  Would you want gold at 40% off right now or pay another record high price for another painting?

PT's picture

Excellent idea!

Extra!  Extra!  Get your da Vinci CDSs here todayyyy! 

Downtoolong's picture

In other nooz…

Yellen Hires Particle Physicist To Detect Wealth Effect.

In the latest example of top scientific minds being channeled into the financial sector, Janet Yellen, newly appointed Chair of the Federal Reserve has hired Nobel Prize winning particle physicist Naveen Gupta to prove the Wealth Effect actually does exist in the economy. Frustrated by naysayers who claim the Wealth Effect is only theory, Ms. Yellen has asked Mr. Gupta to help produce empirical evidence of its existence once and for all.

In our exclusive interview Naveen explained how his basic approach will be analogous to his prior work at the Hadron Collider. “In particle physics, you deal with very low probability events occurring on an incredibly small scale. You often must bombard matter trillions of times with high energy particles before you produce one measurable event or effect of the kind you’re looking for.”

“It’s the same with the Wealth Effect.”, says Mr. Gupta, “You have to bombard the economy with huge amounts of stimulus dollars to produce even one more dollar of marginal spending by wealthy people. In fact, we estimate the probability of that happening to be even lower than rare subatomic particle reactions; like one in a Google to the power of Avogadro’s Number or something. At the current pace of stimulus printing at the Federal Reserve it could take 100 years before we record a single example of the Wealth Effect. But, we’re confident the phenomenon does exist, and that Ms. Yellen will step up the pace of printing to produce a measurable event by the end of her first term. Considering the importance of this finding to defend the Feds stimulus programs, the $2 billion allocated to this special project is not just a great investment by Ms. Yellen, but a necessary one.” 


 

tom a taxpayer's picture

Small edit: Mr. Gupta's previous work was at the Hardon Collider.

 

Small edit no.2: It is not Ms Yellen, it is Mrs Akerlof. Ms Yellen married George Akerlof, a Nobel prize-winning economist and professor emeritus at the University of California, Berkeley.

Small edit no. 3: Mr Gupta was not referring to particle physics but rather his difficulty arousing his wife when he stated: "You often must bombard matter trillions of times with high energy particles before you produce one measurable event or effect of the kind you’re looking for.”