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Sotheby’s filed an 8-K which contains some information on the increase in a facility to provide auction guarantees. This information comes after a Summer when collectors and buyers report that Sotheby’s has become more aggressive in soliciting third-party guarantees for works in the $1-2m range:
Increase the maximum permissible amount of net outstanding auction guarantees (i.e., auction guarantees less the impact of related risk and reward sharing arrangements) from $300 million to $600 million.
In a Dealbook article that goes out of its way to promote the bond insurers’ objections to Detroit’s Grand Bargain, The New York Times throws everything it can at the deal. Despite the guidance of two Federal judges, the Times repeats the bond insurers’ claim that the deal treats Detroit’s pensioners as preferred creditors. The story also reveals an appraisal of the collection that is 10x the value determined by Christie’s and Artvest (which, it has to be said, were both done more to promote the firms doing the appraising and provide the city’s emergency manager with a fixed point to negotiate from.)
What’s most troubling about the Times advocating for the bond insurers is that the latest plan being touted doesn’t help the city. A sale would retire debt but a new loan only defers payment and increases the amount through interest. If Detroit were taking a loan against its art to build infrastructure that could attract citizens and industry which, in turn, would improve the tax base, the idea might have some merit. But that’s not the case here.
Details of Art Capital’s proposal came from a term sheet, marked “proprietary and highly confidential,” that was provided to The New York Times by a person opposed to the grand bargain. Terms were said to be subject to negotiation, but the city will not negotiate. […]
Art Capital is proposing a loan that would range from $500 million to $3 billion, which could be cut up into different maturities and repayment schedules. Interest rates would be based on the benchmark rate known as Libor plus 5.5 to 8.5 percentage points, which analysts say would be reasonable for a bankrupt city that is preparing to repudiate some of its debt. Art Capital’s supporters say its loan would have the advantage of not tying up an essential city tax stream in the event of a default because it would be heavily collateralized by the artwork.
Both loan options would be repaid by the city’s revenue streams, like income, property and casino taxes.
Detroit Mum on Proposal to Use Its Art as Collateral (NYTimes.com)
The good people at ArtNews have posted Poly Culture’s six months results for 2014 which show a 24% rise in revenues at Poly Auction from $68m to $84m. Overall auction sales seemed to be about 2/3 of a billion dollars:
Due to the impact from macro economy, Chinese artwork market still ranged at lows in the first half of 2014, with a modest yet more prudent recovery in turnover and, especially, a subdued transaction momentum for high-priced artworks. As such, the Group took initiatives to increase the supply of middle and low-priced auction items in line with market conditions.
In the first half of 2014, the Group achieved total auction turnover of approximately RMB4.1 billion [$666m], maintaining the leading position in the industry. Beijing Poly International Auction Co., Ltd. (“Poly Auction Beijing”) recorded auction turnover of approximately RMB3.188 billion [$517m] for the first half of 2014, securing its leadership in all segments with a balanced business mix. At the Spring Auction, it recorded auction turnover of RMB2.78 billion, ranking first for 12 consecutive times in the domestic large-scale artwork auctions. To proactively develop middle and low-end markets, Poly Auction Beijing also held auctions in Hainan and Zhejiang in the first half of the year while ensuring successful….
The novelist Claire Messud has one of those not-quite-a-profile, not-quite-a-think piece on Marlene Dumas that seems to rest heavily on one long, intoxicating visit between artist and novelist from which the novelist extrapolates, perhaps, too much:
In recent years, her paintings have sold at record prices for a living woman artist, the citation of which is a source of continual frustration to her. “I’d like to be remembered for something else,” […]
“With certain things I’ve done,” she said, “I don’t regret that I’ve done them, but you also have the thing as a painting itself, and later, when all other things are gone, you think, ‘I wonder, is this really an interesting painting?’ ” — she appraised a painting in her mind’s eye — “. . . and with the different curators, if they all agree that it’s okay, you distrust that, because they should see that it isn’t; but if you maybe think that something is actually good, and they don’t really react . . .” She shrugged. “Some artists, they say, are much more clear about what’s good and what’s bad in their own work. But I find it difficult.” […]
The example of “Twice,” the joint exhibition for which she painted “Missing Picasso,” is particularly telling. While Tuymans painted new works for the exhibition, Dumas, in some instances, returned to earlier, unfinished paintings, finding in the show’s theme the route to their completion. While Tuymans worked on his own, with an unwavering idea of his plan, Dumas consulted Tuymans for his opinion. When Tuymans suggested that they each show only six works, Dumas concurred, but marveled at his continence. “If I don’t work for long periods, then when I do, I go on till the end, and then sometimes I have too many works,” she told me. “Mostly I never think like that, I first see what I do, and then in the end I decide. But I thought, O.K., it was more efficient. It’s funny, these differences. You could also say he’s a man who knows himself well.” She emitted a roar of laughter.
Social Studies | Marlene Dumas (T Magazine)
Asher Edelman continues his campaign against the Swiss art concern that was attempting to sell a large cache of paintings. The deal fell apart under odd circumstances but now Edelman wants satisfaction:
A professor at Willamette has attributed a painting held in the same family since the 19th Century to Peter Paul Rubens:
The search to uncover the artist behind the portrait began when De Mambro Santos’ former student, Cecilia Paolini, called him from Rome two years ago. Paolini, an independent scholar and expert in restoration and conservation of paintings at the Laboratory of Restoration in Rome, has been De Mambro Santos’ longtime collaborator on Flemish and Dutch art research. The owner of the painting, who wishes to remain anonymous, hired Paolini to to clean and restore the painting. Paolini had immediate questions about its origin and contacted De Mambro Santos, who flew to Rome to assist. […]
Analyzing the portraits’ material and chemical composition and its style, they tested and confirmed their hypothesis that Rubens was the portrait’s creator. Key factors were the presence of a yellow pigment used only by Flemish Masters in the Roman workshops of the time and the piece’s curvilinear brushstrokes.
[…] The rediscovered portrait also has historical implications. It is now Rubens’ earliest known portrait of Archduke Albert VII, who became Rubens’ most important patron throughout what became a grand and influential career. De Mambro Santos said that before this discovery, it was assumed that Rubens and Albert met after 1604 and didn’t become closely tied until 1608. The portrait may have launched Rubens’ career.
[…] The rediscovered portrait is small and was likely used as reference point for Rubens’ future work and numerous portraits of Albert that have similar attributes. The archduke appointed Rubens his court painter in 1609. Rubens traveled a great deal, especially for his diplomatic work. He probably used visual references like this piece when he had to complete a commission and was miles from Albert.
In spite of the rediscovered portrait’s historical and artistic relevance, the piece’s value is still being determined.
“I have no idea really,” De Mambro Santos said of its value. “It could be 4,000 euros or four million euros.”
Lost Rubens painting rediscovered by Salem professor (Statesman Journal)
One of the overlooked goals of Burning Man, the desert festival that opens today, is that the twinned ethos of “radical self-reliance and radical self-expression” culminates in a great deal of art making. From each year’s man that goes up in flames to the dozens of other works of art that are created for the event, Burning Man is one of the larger annual art events in the United States.
There is, however, a substantial gap between what Burning Man considers art and what the art establishment thinks of as art. Some works, like Josh Haywood’s Hayam Sun Temple, could easily be erected at a museum. Others, like the Indiegogo project The Vulvatron, which the Huffington Post says will be out on the playa but Burning Man’s site does not list, would be an unlikelier fit:
The Vulvatron is an interactive, immersive mobile art environment that honors the female form using video projections, responsive LEDs, sound, and scent. Its compelling visual and interactive concepts enable a dynamic exchange of experiences between all participants. The environment responds, embraces, and transforms all who choose to interact.
The Vulvatron consists of 3 main features: The Vulva & Clitoris, The Erogenous Zone, and Mobility.
The Vulva and Clitoris
The Vulva is two 18’ tall video projection screens made of 4-way stretch fabric. Live video artists will perform projection-mapped video and multi media sets. Participants can play with a Kinect motion and proximity sensor to affect the projections. The Vulva lips are lined with RGB addressable LED strips that process the live video. The Clitoris is a 36” diameter acrylic dome lined with super-bright LED lights, hanging at the peak of the Vulva screens. When participants touch pressure sensors located inside the Erogenous Zone, both the Clitoris and the Vulva light up in programmed responsive animations.
Jean Pigozzi is an entertaining character who straddles the worlds of technology, finance and art. He makes good copy. His most interesting score remains his discovery of Africa’s seminal photographers, Seydou Keita and Malick Sidibe. The Keita story has been controversial and told in other places before. Here, at Lunch with the FT, we get more details straight from Pigozzi:
Conversation turns to his collection of contemporary African art, consisting of more than 10,000 works. “The way I do it, collecting art is very similar to venture capital. I have no interest in buying work by Basquiat, Renoir, Sisley – like my parents did. I don’t want to be a sheep.”
Instead, in the early 1990s, Pigozzi became aware of contemporary African art, particularly photography taken in the mid-20th century by the operators of small portrait studios. He hired a curator, André Magnin, who proceeded to scour the African continent for work, buying directly from artists. Pigozzi tells me he gave Magnin the following three rules: (1) the artists had to be black, (2) the artists had to be alive, (3) the artists had to live in Africa.
On his travels, Magnin discovered negatives that had been stored for decades, which he took back to Pigozzi, who sold the works, making international stars of local photographers such as the Malians Seydou Keïta and Malick Sidibé. Today Pigozzi loans his collection to galleries such as London’s Tate Modern, the Pompidou Centre in Paris, and New York’s Guggenheim; while a signed print by Keïta, who died in 2001, can sell for $100,000.
Pigozzi has been accused of plundering Africa for personal gain but is unapologetic. “I wouldn’t change anything about how I went about collecting contemporary African art. No one did it before me; so of course there would be controversy. Everyone said I was mad to collect African art produced after 1900. But now the market is picking up. Seydou Keïta is one of the most important artists of the past century, in the same category as Irving Penn. He deserves to be recognised.”
He has, he says, “spent a lot of my time and money fighting the cause of African artists in court and regulating the market for their work. I’ve helped more African people with building their homes and villages and sending their kids to school and paying for funerals and weddings – so zero exploitation there. But what I’m proud of most is how we saved thousands of negatives. Negatives are fragile things. And if you leave them in Africa, with the humidity and the way some of the people there were not caring for them, they would have all been destroyed by now.”
The controversy surrounding Pigozzi’s collection is, says Michael Hoppen, one of London’s leading photographic art dealers, “nothing more than professional jealousy. He’s been instrumental in bringing a lot of very interesting art from Africa to a lot of people’s attention.”
Lunch with the FT: Jean Pigozzi (FT.com)
It’s the quiet season in the art market. Time for reflection on what’s happened and what’s to come. Surprisingly, the word in the air seems to be one of moderation and retreat. Scott Reyburn channels some of that in his International New York Times column. He points to Sotheby’s weak stock price as a signal that the booming art market isn’t necessarily a boon to auction houses:
“Auction houses aren’t scalable businesses. They can’t expand by multiples like dealerships,” said Michael Hutter, a cultural economist who is director of the Cultural Sources of Newness research unit at the WZB Berlin Social Science Center in Germany. “Profits are crumbling at the top of the market. They can’t charge 50 percent, which is partly why they’re turning to online sales.”
Evidence of that auction houses have bumped into a ceiling, Reyburn says, can be seen in Sotheby’s stock price having slid from $55 to $40 in recent months.
“There’s a feeling among financial analysts that the valuations of art-related companies are peaking,” said Fabian Bocart, the director of quantitative research at the Brussels-based art investment advisers Tutela Capital. “These valuations are based on expected volumes at auction. Very expensive items have almost no impact.”
In other words, the headline sales don’t translate into operating margin for the auction houses and their growth prospects are limited by the seeming lack of a middle market:
“There are definitely fewer art buyers than there were in 2008,” said Mr. Bocart, the research director. “The cards have been redistributed by the financial crisis. Fewer people have more money, and they do spend more, but the base has been diminished. Art needs to be refreshed. We’re waiting for something to happen.”
Meanwhile, something is happening with Sotheby’s stock which has sharply recovered the crucial $40 threshold. Let’s see if it can hold above that price.
Scratches in the Art Market Gilding (NYTimes.com)