With Hard Asset Prices Plummeting, What's Next for the OA Market?

[Silver Surfer]

Blackberry stock just went in the toilet, mortgage rates are rising in Canada. I just get a sinking feeling that the market is going to go for a tumble.

[buttock]

Blackberry is outdated and nobody wants to live in Canada.

[Bronty]

[r100comics]

I have a question about the "whales". Are there people that are, extrapolating from recent auction prices, sitting on collections worth 20 or 30 million+ dollars (or more)? I have heard of pages out there that could bring low to mid 6 figures based on comps (and not the ridiculous McSpidey Nut Shot or the DKR splash either), and I am excluding from this calculation any really big items like the Giant Size X-MEN 1 Cover or any really key covers for that matter. I am just talking about lots and lots of really A+ pages. It just seems like a staggering amount, and if true, it is hard to understand that more of it doesn't come to light. Obviously there is no rush as long as you can get 50k+ for a B+ page, but am I right (or low) about the implied value of some of these collections (and again, I am talking quantity of A+ pages and am not even counting the over the top covers that might bring 6 to 7 figures on their own)?

 

Well, there's this fella on CAF, and he's got some very nice stuff for the public to see. I also recall he has the cover to Conan #1 and Marvel Spotlight #5, among several others: http://www.comicartfans.com/GalleryDetail.asp?GCat=717

 

Who knows what he's got stashed away in the closet?

 

Anyone know what happened to the Tony Christopher OA collection that was purchased by William Hughes / Greg Manning 10 to 15 years ago ?

 

It reportedly contained 900 pages of vintage Kirby OA along with Ditko, Everett, Adams etc and sold for $1.1 million, which was a chunk of change back then.

 

I'm wondering which key pieces we've seen come up in the last 10 years were from that collection and what's still locked away in private hands ?

 

 

[mtlevy]

I am not the expert but I thought much of it was released to the market and absorbed after a brief dip in prices

[Garf]

Blackberry stock just went in the toilet, mortgage rates are rising in Canada. I just get a sinking feeling that the market is going to go for a tumble.

 

The mortgage rates are probably going to rise in quite a few places soon and that is going to hurt a lot of people. When life as a service starts to cost more in general non-essentials and anyone supplying them feels it. The current mortgage/interest rates can't stay like they are forever and they are just putting off a very large wobble in the system.

[suspense39]

Just remembrer mortgage rates were a t 17.25 % in the most upwardly mobile period in the US

[vodou]

Just remembrer mortgage rates were a t 17.25 % in the most upwardly mobile period in the US

Which is definitely not now. But don't worry we won't see 17.25 ever again either. Fed will step on that until the dollar is flat dead worthless anywhere outside our borders.

[delekkerste]

Just remembrer mortgage rates were a t 17.25 % in the most upwardly mobile period in the US

 

I'm afraid that this is very misleading. Mortgage rates spiked to those levels in 1981-1982, which coincided with the very prolonged and deep July 1981-November 1982 recession, so it's not like the economy was faring well at those high rates. The most upwardly mobile period in the US came after the recession, by which time mortgage rates had begun to plummet from their peak levels. In any case, what people don't get when it comes to interest rates, tax rates, money supply, etc., is that flow (i.e., the direction and magnitude of changes at the margin) often matters more than the stock (i.e., absolute level) of what is being measured - even relatively small moves towards interest rate normalization have the potential for far greater repricing/revaluation than you might expect.

 

Right now, not only are consumers, businesses and governments used to and dependent on these abnormally low levels of interest rates, but ALL ASSET PRICES IN THE UNIVERSE ARE PRICED OFF OF THEM. Of course, anything with a cash flow or yield is always priced off the term structure of interest rates, but even assets like gold and art, which do not, are implicitly priced off of interest rates because of the embedded holding/opportunity cost. Again, this happens whether or not the buyer has any clue about this; it becomes ingrained and incorporated in one's thinking.

[inovrmihd]

And therein lies the crux of the matter. Do the 3, 5, 7, 10, 12 guys /gals who own all (or almost all) of the silver age superhero art own other assets, and are they in a financial position such that they care what happens to them. Not that I have a particular wish that a handful of people lose their money, but if they are sitting on stock, bond, gold portfolios, maybe they decide now is a good time to start selling. If not, asset price drops aren't going to affect this segment of the OA market. One caveat though. If they have a lot of friends who collect more mainstream art and they get crushed, it may give them second thoughts about cashing in.*

 

One caveat to that caveat (and keep in mind I know next to nothing about art and look forward to push back on this). The way I figure it, if these guys make analogies of their collections to the rest of the art world, my guess is they figure they own the old masters ie. Da Vincis, Rubens, Rembrandts; etc. They aren't going to be too fazed if their friends take a bath on some Damien Hirst spin painting or Jeff Koons tin lobster on a chain. The whole contemporary (?) factory produced Jeff Koons type art market might collapse, and the whales might just laugh their asses off and not sell a thing because as far as they are concerned, it was never "real" art anyway.

[delekkerste]

And therein lies the crux of the matter. Do the 3, 5, 7, 10, 12 guys /gals who own all (or almost all) of the silver age superhero art own other assets, and are they in a financial position such that they care what happens to them.

 

If you're talking about the guys who have been sitting on the best stuff for the past 20-30 years and dribbling it out when they need cash, I think this is largely a sideshow and is not what sways the direction of the overall market. Clearly, if you are aware of some of the convoluted financing schemes these guys use behind the scenes (e.g., I will give you this complete story as collateral in exchange for a large loan, Mr. Dealer), they do sometimes need cash, and lots of it, and maybe a generalized downturn in the economy exacerbates that need somewhat and causes some more art to hit the market. But, by and large, it seems as though these guys will keep the best stuff for as long as they possibly can and that external economic considerations are not likely to change that much.

 

I suspect that, when this A+ material is eventually sold in the next 0-30 years, it will probably do well under most scenarios. I just don't think the buyers of this material at the then-prevailing prices are going to fare particularly well over the long run, which is more to my point. It's a great time to be an OA seller of wildly appreciated art that you bought on the cheap in the '70s, '80s, '90s and first half of the 2000s. I'm not so sure it's a great time to be a buyer at record prices (from a purely financial standpoint; if you have money to burn and love it, knock yourself out...just don't expect any sympathy when you end up owning a bunch of white elephants instead of the goldmine you thought you had).

[SAM MALONE-migration]

The best of the best will always do well. If you are buying Dondi strip art than yeah, you may have a problem. Besides, the end of the bull run in hard assets is grossly exaggerated. There is nothing - nothing more inflationary than a whiff of deflation and there is a whole lot of deflation headed our way.

 

1976 vs. 2013

[Rodey]

Cheers!!

[inovrmihd]

I think I hijacked the thread a little bit. I definitely think the top is in, and new buyers, myself definitely included, are not going to do well if we are inclined or have to sell any time in the foreseeable future, particularly if we bought at auction - having to outbid everyone else and pay the buyers fees that entails. As an investment, I think the best that buyers at these levels can hope for is a period of extended low interest rates so that their losses aren't enormous in comparison to what they could have earned in relatively safe investments.

 

I do have one caveat however (if for no other reason than to continue this thread, which I am really enjoying). The one way we are wrong about a market top is if you can convince a whole new group of super rich people that are used to spending millions on art that OA is the new thing. Get Stevie Cohen (substitute JAY-Z if the name doesn't ringa bell) and 5 other guys like him interested and it is a whole new ballgame. So with that said, before declaring this the definitive top, I would like to know the backstory behind the McSpidey Nut Punch sale. Was this a one off mystery, or is it part of a grand scheme to draw in a new class of collector/investor? If someone will pay millions for a Jeff Koons Hulk

 

http://www.gagosian.com/exhibitions/jeff-koons--may-11-2013/exhibition-images

 

maybe they can be talked into paying millions for a McSpidey Hulk getting punched in the nuts, or maybe it is part of some grander plan (intelligent speculation on this encouraged)?

 

One other thing. You made the following comment:

 

"Clearly, if you are aware of some of the convoluted financing schemes these guys use behind the scenes (e.g., I will give you this complete story as collateral in exchange for a large loan, Mr. Dealer), they do sometimes need cash, and lots of it, and maybe a generalized downturn in the economy exacerbates that need somewhat and causes some more art to hit the market."

 

I know nothing about this (actually heard one story, but that's about it). I would love to hear more.

[delekkerste]

I do have one caveat however (if for no other reason than to continue this thread, which I am really enjoying). The one way we are wrong about a market top is if you can convince a whole new group of super rich people that are used to spending millions on art that OA is the new thing. Get Stevie Cohen (substitute JAY-Z if the name doesn't ringa bell) and 5 other guys like him interested and it is a whole new ballgame.

 

If that's your only caveat, you can rest easy - it will almost assuredly never happen despite what some people here would like to believe. If you're not passionate or knowledgable about fine art, you buy it anyway because of the glamour, prestige, social cachet, etc., and you can hire expert advisors to fill in the blanks where you lack knowledge. Also, your social-climbing wife is probably egging you on in this endeavor and probably spending more time on your collection than you are because you're too busy running your hedge fund, real estate empire, tech company or whatever it is you do to earn the millions/billions of dollars you need to be a player in that world. You're also probably so rich that you're not even thinking about ever getting your money out of the art; you're thinking about which museum is going to name a new wing after you and your wife once you pledge your collection to them in your will.

 

If you're thinking that this doesn't sound anything at all like the OA world and the people who populate it, you're right. There are no major museums dedicated to the field where today's collectors are dying to assemble great collections to bequeath to them. Nobody's wife is egging them on to buy more comic art. This is a hobby that attracts fanboys, rich (to a certain extent) and poor, who are truly knowledgable, passionate and nostalgic about the source material. This is not a hobby where you get advisors to tell you what to buy. This is not a hobby where someone running an empire like Stevie Cohen or Jay-Z is going to take the time out to ever learn everything they need to know about how various inkers affect the value of Kirby art or what happened in all the key issues that causes OA from those books to be worth more than comparable art from, say, the surrounding issues.

 

I don't doubt that, like previous efforts to get coin collectors into comics and comic art, the big dealers and auction houses will try to find investor types to buy comic art. I'm sure it's already happening to a certain extent (I've heard stories, of which the ASM #328 might have been a part of). But, I don't see a sea change in the attitudes of fine art collectors/uber wealthy people whereby they will come over and cause a mass revaluation of OA. Spend enough time around both ludicrously wealthy people and fine art people as I have and this will become crystal clear.

 

 

If someone will pay millions for a Jeff Koons Hulk

 

http://www.gagosian.com/exhibitions/jeff-koons--may-11-2013/exhibition-images

 

maybe they can be talked into paying millions for a McSpidey Hulk getting punched in the nuts, or maybe it is part of some grander plan (intelligent speculation on this encouraged)?

 

People will pay millions for a Jeff Koons Hulk because it is a Jeff Koons. A McSpidey Hulk cover has about as much in common with a Koons Hulk painting as kumquats do with Cadillacs in their view. Those buyers will never appreciate or value comic art in the same light. Trust me, IT WILL NEVER HAPPEN. And, frankly, that's OK - there are enough people like us who appreciate OA and don't necessarily care for Koons.

[Bronty]

that's well explained Gene

[Nexus]

Get Stevie Cohen (substitute JAY-Z if the name doesn't ringa bell) and 5 other guys like him interested and it is a whole new ballgame.

 

All it takes is one buyer of that class to move the needle. You don't need the other five. In the past 20 years, there have been individual collectors at various times who have proven to be game changers. I'm thinking of three in particular. It doesn't take much...which either points to the limited appeal of comic book art or to the possibility that we are still in the early stages.

 

Now, the odds of an outsider entering the hobby that way are low, for many reasons (and certainly anyone buying OA as an "investment" on that slim chance is a poor gambler). But I also don't consider it an impossibility. Mid-seven figures nets you a cute, beginner's contemporary art collection. In OA, mid-seven figures makes you a king. That's potentially attractive to the type of collector who wants trophies, even if the audience to admire them is still small.

 

People will pay millions for a Jeff Koons Hulk because it is a Jeff Koons. A McSpidey Hulk cover has about as much in common with a Koons Hulk painting as kumquats do with Cadillacs in their view.

 

I get what you're saying. But that Koons Hulk is clearly an installation piece and bears little resemblance to OA.

 

Those buyers will never appreciate or value comic art in the same light. Trust me, IT WILL NEVER HAPPEN.

 

Check this out this Mel Ramos painting:

 

 

Someone paid $800K for that. And it wasn't one of the usual suspects in our hobby. Again, I'm not counting on it...but hesitate to say "never".

 

[mtlevy]

Agree - it is unlikely but not out of the question

 

Illustration art was not very valuable or particularly respected, correct? But the finest artists in that genre are quite respected and garner 7 figures prices - Rockwell anyone?

 

Why couldn't Kirby be the next Rockwell? I don't think it is even a "Black Swan" event...in realm of possibility

[Bronty]

Its just a goofy fit for the art world though, isn't it?

 

A) Have any artists that worked almost exclusively in black and white illustrations ever become really valuable? Ever?

 

B) Drawings, be they pencil or india ink, are more or less looked at the way the comic OA world looks at prelims aren't they? I.e. drawings are usually cheap and its full color pieces that are usually valued.

 

C) The points Gene raised re kirby's different inkers, and the events in the published comics that affect value, etc.

 

 

So when it comes to art world types going for it, I don't see it.

 

That being said, what Felix said is true. All you need is a really wealthy aggressive buyer or two to move the needle. With all the characters kirby created and how long they've remained popular, its not that farfetched - that's the more likely scenario than the art world suddenly waking up to Devil Dinosaur.

 

I mean let's step aside our own POV for a minute and look at kirby pages from the likely POV of the fine art world instead of our own POV.

 

What precisely about kirby's output is going to impress the curator of, I dunno, the Guggenheim? The size? no. The color? definitely not! The wall presence? What wall presence. (remember this is from their POV not ours). A page with six small drawings called "panels" HAS no presence. (again, their POV not ours). The beautiful drawings he produced? Ummm, no.... you need to have looked at miles of kirby before you can even appreciate the man's work. Has anybody in the history of the world ever laid their eyes on kirby's work for the first time and gone, wow, that's genius?? Please, you look at it for the first time and think WTF are all those squiggles?

 

Nobody likes kirby more than me - I think he's the #1 comic artist of all time. But pragmatically speaking his work is an acquired taste that looks awfully good from our shoes but if we step inside the shoes of other people they are just not going to 'get it' or WANT to 'get it', in all probability.

 

 

[vodou]

Actually all it takes is a 'significant' dealer and several 'significant' collectors (from the Big Boys club) to all suddenly begin promoting comic OA. Quietly at first, then the waitlists begin. From there the promotion will either take or it won't. B/w, small, out-of-context, none of this matters much against 'perception'...and that's accomplished by word of mouth, bottleneck scarcity and manufactured prestige. So whatever would be promoted would have to be heavily accumulated first and then doled out very carefully for undisclosed (if you have to ask, you can't afford it) prices and waiting lists. Living guy, dead guy, doesn't matter (as long as the living guy is in on the take). Some sprinkling in the big boy post-war auctions (Christie's, Sotheby's) with appropriate far over estimate final hammers helping too. The stigma of 'collectible' must be shed, these actions help get that stink off.

 

None of this promotes appreciation or scholarship of panelology, we're just talking about getting $1million price tags and institutional interest out there.

 

May not be possible though as long as the premiere coin/currency/stamp auction house is wholesaling bulk lots every Sunday night! Somehow an obvious differentiation between 'ours' (Big Boys) and 'theirs' (HA, CLink, etc.) would have to be made.

 

Ours is a very small market though, when compared to the big dollars sloshing around out there (crash of hard assets or not). If somebody went to all our big dealers and wanted to quietly accumulate (corner) all "x" on the market, it could be done. As much as people say they'd never sell their grail/s, the reality is most would jump at a double on what the last HA comp was.