Art Market Monitor

If you believe the auction houses, the problem facing the art market in 2009 is not a lack of demand, as most would think, but a dearth of high-quality, bankable supply. After all, who wants to sell when the market is down and buyers are running for cover? Certainly not those who acquired works in the frenzy years of 2005-2008. And you can’t call anything that’s been on the market this decade fresh, now can you? That leaves sellers who have no choice but to sell.

The Madoff scandal has already caused two deaths. Surely there will be a divorce or two that comes from the recriminations too. But the final D of the auction house troika may not be Debt in 2oo9. For many Madoff investors, the new D is disaster. Sotheby’s CEO Bill Ruprecht is quoted in the Wall Street Journal saying he’s fielded calls from Madoff’s victims:

For sellers, 2009 may be a year of lower expectations. Sellers who have a choice will likely sit on the sidelines, experts say, leaving the market to those who must sell to settle an estate, a divorce or a debt. Mr. Ruprecht says he has spoken with “lots” of collectors who had invested with Bernard L. Madoff Investment Securities, the New York firm that allegedly carried out a $50 billion Ponzi scheme. “I have clients for whom art is the sole liquid asset they own today,” he says.

With the Dreier art potentially coming to market too, there’s some hope that 2009 won’t be a total drought.

Art Imitates Crunch, with Few Exceptions (Wall Street Journal)

Also of Interest:

• Madoff Inventory Floods Market
  Dow Jones Newswire‘s Shelly Banjo looks into the glut of Madoff inventory coming on the market. Everything from precious Judaica...
  
• Madoff’s Gift to the Art Market, pt. 2
  Bloomberg’s Lindsay Pollock does a little sleuthing on Ezra Merkin’s collection of Rothkos which their art adviser seems to be...
  
• How the Auction House Heads See the Market
  Reuters spoke to the heads of Sotheby’s and Christie’s here in the US to get their sense of the art...
  
• Madoff Had No Art But . . . .
  Connecticut Attorney General Richard Blumenthal got called into an art scam that uses Bernie Madoff as a set-up. Northeast Galleries...
  
• Cash for Madoff Victims in Palm Beach
  Madoff victims are selling through Kodner Galleries in Palm Beach because they’re advancing cash to the consignors: Kodner was first...