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"Art is the ultimate asset.” ?

Started by Peter G,

55 posts in this topic

vodou

vodou

Posted
Posted

Mmm. Understand I wasn't dismissing that most art -wherever it hails from- is garbage. But the gems, at least what I'm looking for, often come out of (let's say) subpar circumstances. But not what's for tourists, so-called marketplace pieces. Or what the marketers bring back here to 'push'. Specifically I was thinking of post-war Polish and Slavic art. Not the communist state works, but the theater/opera, where the horror of daily existence sort of leaks out the edges in interesting ways, while still accomplishing the primary goal of advertising. These can be challenging to hang but there's a lot going on there.

 

An example that I was surprised passed earlier today:

http://www.liveauctioneers.com/item/31354528_franciszek-starowieyski-poland-1930-2009

 

I didn't go for it because the size...more than I can handle right now. I'm very much out of space. However at $5k and freight...a slightly better price than what similar have gone for the last few years.

 

And this site overall, a lot appeals to me. Browse around if it's your thing...

http://www.agra-auctions.com/index.php

 

I do have my eye on Bangladesh, funny enough, but I'd need to go there and live it a bit to find the cubbyholes :)

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suspense39

suspense39

Posted
Posted

Yes it does. I can understand high prices for art Warhol and earlier (though not that high!) due to the fact that pretty much every innovation in art, especially painting has been played out from that point backward, after that it's more or less just variations of art from the past; some great but certainly not breakthrough. These prices are insane and for the time being it seems like the sky's the limit.

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delekkerste

delekkerste

Posted
Posted

To point to high-end Modern & Contemporary Art and luxury real estate (which, after being on fire for the past couple of years, has been slowing dramatically over the past quarter or two) as evidence of inflationary pressure is ridiculous. Clearly there is inflation in the stuff that uber-rich people buy (high-end art, luxury real estate, sports franchises, stakes in tech start-ups, etc.), as QE/ZIRP has inflated the value of their financial assets.

 

However, for everybody else, deflationary signals abound. Gold and silver at 4 1/2 year lows. Crude oil prices down 30% since the summer. Gasoline prices below $3 almost everywhere. Commodity prices at multi-year lows, including both food & energy items (wheat and corn prices down 25-30% since the spring). Apparel retailers in a competitive battle to the death. Airline prices coming down with fuel prices.

 

Funny that the article comes from a website called "DollarCollapse.com", when the U.S. dollar is at a 4 1/2 year high and looks, in the intermediate-term, to be heading back at least to the pre-financial crisis levels of the mid-2000s. 2c

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vodou

vodou

Posted
Posted

It's simply reflective of the widening (and essentially historic) gap between the 1/10 of 1 percent and everybody else. A great question is what happens to comic OA if the (1/100)/10 don't decide "it's cool"? Or if they do :whee:

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cirnick-migration

cirnick-migration

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I do believe art is a great asset...but I am mystified as to who is buying (or able to afford) the high end stuff (meaning over $50,000).

 

I asked one art dealer if there were a lot of businesses buying up the high end stuff as investments and he said no. He said just regular joes are buying up the stuff. I asked if he thought they were making a once iin a lifetime investment and he did not think so. Apparently a lot of peopple must be earning fortunes at their day jobs to be able to afford high end art :)

 

Does anyone have any info or opinions to share about this?

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vodou

vodou

Posted
Posted
I do believe art is a great asset...but I am mystified as to who is buying (or able to afford) the high end stuff (meaning over $50,000).

 

I asked one art dealer if there were a lot of businesses buying up the high end stuff as investments and he said no. He said just regular joes are buying up the stuff. I asked if he thought they were making a once iin a lifetime investment and he did not think so. Apparently a lot of peopple must be earning fortunes at their day jobs to be able to afford high end art :)

 

Does anyone have any info or opinions to share about this?

I wonder the same as you. There is a lot of money out there, for sure, but it's actually pretty concentrated. At least according to all recently published statistics*. And I don't believe the wealthy (or high earners, not always the same people) stay that way by burying more than small percentages of net into art, be it comic or other types. And of those people, a rather small set to begin with, the even smaller set are those that care enough about comic art (or even knows/cares it exists?) to put money into it. It's happening every Heritage, every ComicLink, every ComicConnect, every Weiss, etc. but squaring that with the statistics...not working for me.

 

*If you have $100k or more in savings, you're in the top 7.7%, $1m or more top .07% of world population. $100k is x2 $50k pieces. $1m is only x20. And the presumption would be there are some nice houses and cars, stocks, bonds, other art, other investments, income generating real estate, most/all not levered much?, adding to net worth too?? So how many Joes are playing at this level more than once? Especially if it's not the same Joes every time, and there isn't any evidence of speculator buying programs...at least not en masse?

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Pete Marino

Pete Marino

Posted
Posted
I do believe art is a great asset...but I am mystified as to who is buying (or able to afford) the high end stuff (meaning over $50,000).

 

I asked one art dealer if there were a lot of businesses buying up the high end stuff as investments and he said no. He said just regular joes are buying up the stuff. I asked if he thought they were making a once iin a lifetime investment and he did not think so. Apparently a lot of peopple must be earning fortunes at their day jobs to be able to afford high end art :)

 

Does anyone have any info or opinions to share about this?

I wonder the same as you. There is a lot of money out there, for sure, but it's actually pretty concentrated. At least according to all recently published statistics*. And I don't believe the wealthy (or high earners, not always the same people) stay that way by burying more than small percentages of net into art, be it comic or other types. And of those people, a rather small set to begin with, the even smaller set are those that care enough about comic art (or even knows/cares it exists?) to put money into it. It's happening every Heritage, every ComicLink, every ComicConnect, every Weiss, etc. but squaring that with the statistics...not working for me.

 

*If you have $100k or more in savings, you're in the top 7.7%, $1m or more top .07% of world population. $100k is x2 $50k pieces. $1m is only x20. And the presumption would be there are some nice houses and cars, stocks, bonds, other art, other investments, income generating real estate, most/all not levered much?, adding to net worth too?? So how many Joes are playing at this level more than once? Especially if it's not the same Joes every time, and there isn't any evidence of speculator buying programs...at least not en masse?

 

That assumes that people are rationally spending their money.

 

I am willing to guess there are a lot of people in the comic art world that over spend based on their means, and there are a bunch that have a lot equity in OA because they bought cheap "back in the day" and can play with house money.

 

I know of more than 1 collector that I consider middle class (less than 250k annual household) that will put up 5 digits on art from time to time.

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delekkerste

delekkerste

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Posted
I am willing to guess there are a lot of people in the comic art world that over spend based on their means, and there are a bunch that have a lot of equity in OA because they bought cheap "back in the day" and can play with house money.

 

I know of more than 1 collector that I consider middle class (less than 250k annual household) that will put up 5 digits on art from time to time.

 

Bingo. What the income statistics for the general population doesn't capture is how much of the art out there was distributed to the marketplace at what is now pennies on today's dollar (even less than a single penny on the dollar in some cases). A large portion of the hobby would be largely priced out of today's marketplace if they didn't have such wildly appreciated art and/or cash raised from selling such over the years.

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vodou

vodou

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Posted
I am willing to guess there are a lot of people in the comic art world that over spend based on their means, and there are a bunch that have a lot of equity in OA because they bought cheap "back in the day" and can play with house money.

 

I know of more than 1 collector that I consider middle class (less than 250k annual household) that will put up 5 digits on art from time to time.

 

Bingo. What the income statistics for the general population doesn't capture is how much of the art out there was distributed to the marketplace at what is now pennies on today's dollar (even less than a single penny on the dollar in some cases). A large portion of the hobby would be largely priced out of today's marketplace if they didn't have such wildly appreciated art and/or cash raised from selling such over the years.

Well to start $250k isn't middle class. That's a number plucked to make most feel they're escaping the Wrath of Obama. It's a pretty big number actually when average is only $26k (1/10th!) These numbers are very relative to where you live too. $250k in NYC sure ain't the same as Little Rock :)

 

But the numbers I was using were net worth, not income. However as no collector before Gene counted their art as an asset (j/k) it's understandable that OA net worth was vastly understated!

 

Then again, it's not all or even mostly recycling of money from selling to buy. (As suggested by above posters.) Why? Because that money that was gained by selling had to come from somewhere. So.......begs the question. Doesn't it? Either it's new money, even if filtered (layered? AML for insiders!) through numerous transactions or it's (largely) zero sum moving around in a circle. Yes? I would also suggest with more and more upgrading occurring it may be that many small transactions (art going to new money) may result in that same money aggregating into smaller but more expensive purchases pushing the best much much higher. This activity may explain the lack of obvious big new money moving in yet higher and higher prices being paid by the usual suspects? If so, then there may be a ceiling where those with large art-wealth upgrade all they can (are able to trade up into) or run out of ability to up-bid (each other)?

 

Real growth cannot ever occur in zero sum environment, the pie just gets sliced and diced into different shapes.

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Bird

Bird

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Posted

there is only so much upgrading one can do. For under 250K earners who are not playing with house money (and I think this is the majority of us in the game these days) you can upgrade but moving 5-10 pieces, or more, for one big purchase is a quickly diminishing game. But I think the market for quality art in the four and low-to-mid five figure markets can absorb quite of lot of this type of upgrading and it can continue for years before our tulip market implodes.

 

 

(we planted 100 hyacinth and tulip bulbs today, so forgive my reference)

 

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delekkerste

delekkerste

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Then again, it's not all or even mostly recycling of money from selling to buy. (As suggested by above posters.) Why? Because that money that was gained by selling had to come from somewhere. So.......begs the question. Doesn't it? Either it's new money, even if filtered (layered? AML for insiders!) through numerous transactions or it's (largely) zero sum moving around in a circle. Yes?

 

Not exactly. Yes, money that was gained had to come from elsewhere. However, it is not a zero sum game. Why not? Because not all the art has to change hands (for new money) for the overall size of the pie to grow. For example, let's say that Mike the Collector bought 10 pieces of roughly equivalent value for $250 each way back in the day. So, he has 10 pieces @ $250 each = $2,500 in value. Prices go up, and he sells off one pieces for $5K. So now how he has 9 x $5K = $45K in art left plus $5K in cash = $50,000 value in total. So, yeah, $5K in cash traded hands for art in a zero-sum deal. But, the remaining 9 pieces are all theoretically worth $5K each now, so the size of the pie has increased exponentially. As long as enough new money comes in at the margin, it's possible to keep growing (and, so far, it largely has).

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vodou

vodou

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Well...those unsold pieces are paper gains, not realized. So in your example, just $4750 is new money to spend. The rest sort of doesn't matter (as far as the recent post for $50k plus transactions and how they're occurring so frequently). Except for trade. It takes realized to buy at the Houses. Trade only works with dealers and other collectors.

 

And of course there's credit (in many forms, including ZIRP time payments). It does muddy the waters. Credit expands the pie, perhaps falsely, or at least pulls demand forward (in time). As credit is not limitless, so too are there limits to how much can be pulled forward how far.

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