And we’re back… with some semi-bleak thoughts on the future of the art market.
The art market seems like an anomaly in the economy, as it can be presented as a conundrum to the classical economist. As a market with hardly any oversight or regulation because of the nature of its function, the market seems impervious to (or at least unmediated by) fluctuations in the stock market. (An entertaining anecdote to illustrate the lack of regulation in the market presented in the NY Times described the practice of “chandelier bidding,” which is “a bit of art-market theater in which auctioneers begin a sale by pretending to spot bids in the room. In reality the auctioneers are often pointing at nothing more than the light fixtures.” While somewhat silly, the practice has caused quite a legal mess.)
To divorce the art market from the stock market does not render it impervious to crash, however. The art market bubble “popped” in 2008, fueled by “cynicism, absurdity, and greed,” according to art historian Ben Lewis. In “Accounting for Taste,” Olav Velthius noted that in a survey of international art collectors, confidence in the contemporary art market dropped a staggering 40 percent in the short period between August 2007 and January 2008. Velthius describes an impending crash synonymous in many ways to the 1990 art market crash. Some of the components he highlights that have been indicative of the tantamount relationship are the increasing globalization of the art world in terms of new regions of the world entering and investing in it as well as a strong sense of commercialization, quoting 1989 Whitney Biennial curators Richard Armstrong, Richard Marshall, and Lisa Phillips, in noting that “we have moved into a situation where wealth is the only agreed upon arbiter of value” and that “capitalism has overtaken contemporary art, quantifying and reducing it to the status of a commodity.” The elitism in the art world is a fundamental aspect of its function, Velthius notes, yet this commercial shift could be indicative of the art market’s bubbling popping having widespread financial effects, but it might also democratize the system of collecting to some extent, allowing for a more widespread involvement (or at least a decrease in affluent, somewhat passive collectors’ involvement). In the face of the impending crash in 2008, during a roundtable discussion Isabelle Graw projected an increase in demand for artwork specifically regarding or criticizing contemporary issues of institution because of their relevance: “The commercial markets will have an increased need for a symbolic backup; what they long for are knowledge and information.” It is also important to consider the role of the artist in the diffusion of the effects of a market crash; in an interview with Fulvia Carnavale and John Kelsey, French philosopher Jacques Ranciere notes that “If we shift our gaze from the darlings of the art market, we see that an artist today makes several types of work and has several types of income. In this respect he is closer to the general condition of labor.” To view the artists as a laborer is somewhat of a shift and reconsideration of what it means to be an artist or a collector any part of the market, which is really at the crux of the market’s conceptual trends. And given the blurring roles of these players, deliberate (like Damien Hirst’s Beautiful Inside My Head Forever Auction will pieces going straight from the studio to Sotheby’s) or non-deliberate, this further detracts the art market from stock market trends: Ranciere notes that “the precincts of art lend themselves more readily today than other fields to a redistribution of roles, which is to say, to a redistribution of competences as well. The artist and his productions move between several statuses.”
Many still remain optimistic about the growth of the art market and deny any impending bubble pop. “Auction specialists and private dealers see room for virtually limitless sales records, as long as top-notch material remains at hand,” a report from Stremmel Gallery holds. “Gallerists believe that passion is still the animating force, the bedrock for dealers and their best customers alike. For others, new opportunities abound in emerging territories, from the Middle East and Southeast Asia to the digital realm and the nascent art-fund industry. To paraphrase one veteran, maybe most of us who got involved with the art business are just optimists by nature.” Combining these projections with Velthius’, it seems that perhaps the art market will not “pop” to the same magnitude and devastation as it had in the past; rather, a decrease in the injection of private investments will shift to be a less institutionalized and niche market, reassigning the role of art in society.