Kimmelman Finds Flaws in Paris Show; Estate Withdraws Sale

Picasso and the new realities of the global economy, is there a connection? Here’s how the New York Times’s Michael Kimmelman brings them together in his review of the “Picasso and the Masters” show in Paris:

“FIAC, the art fair that shared quarters in the Grand Palais these last several days, was populated by shell-shocked dealers murmuring worriedly amongst themselves about the bygone customers whom not so long ago they had blithely turned away or gave five minutes to decide whether to buy a picture. Picasso, in such straitened times, remains at least a reliable brand . . . ”

But how reliable? Kimmelman goes on to make this compelling point: “Picasso’s later career, you might say, was a one-man wrestling match with the limits of his own enormous genius in relation to history, and his failures were, humanly speaking, as compelling as his accomplishments, but that interpretation requires from an exhibition not blind hero worship but, as Delacroix had it, a little humility. The show here lacks this altogether, substituting swagger for judgment, bluster for nuance, and in art, as in politics and finance, we’ve had enough of that approach already.” [emphasis added]

Which brings us to the news today that the Donati Arlequin will not go on the block next week. The explanation? “It’s been withdrawn for private reasons,” the Times quotes Sotheby’s David Norman as saying.

The surprise here is not that a consignor would get cold feet in this still uncertain financial climate. The tell is in the terms the consignor chose. As Carol Vogel points out, the Picasso did not have a guarantee from the auction house. That is most likely because the sellers did not want to share any of the upside profit and were unwilling to make a downside compromise on the reserve.

The decision not to sell suggests the auction house is dealing with what the behavioral economists call price anchoring. It’s a phenomenon best seen in house sales where the seller gets fixated on a price (usually the price achieved by a comparable asset like a neighbor’s house.) The seller will not accept a lower price from the one fixed in his or her mind, even if that means not selling. And that’s where price anchoring can be self-defeating. When sellers have anchored the price, it isn’t really about the money. After all, if they thought about it rationally, accepting even a price 20% below the estimate (a worst-case scenario for right now but maybe not a year or three from now) would still be an unbelievable gain on the $12,000 paid two generations ago.

The other possibility for the picture being withdrawn is that the so-called “emerging market” buyers–the Russian, Asian and Gulf State collectors who are the presumed market for this painting–didn’t show enough interest to calm the seller’s nerves. That would be a shock to many. After all, it was the $104 million Boy with a Pipe that announced the presence of Russian buyers as a serious factor in the global art market. There are, of course, many other Picasso canvases on the market next week to entice buyers at a lower price point.

Too much has changed too quickly, and too little is known about the fragile state of all the “emerging markets,” to guess at the what those buyers will do. Nonetheless, Kimmelman’s aside–that there is a connection between the swagger of Picasso and the swagger of finance– becomes a little more compelling in this climate. And it suggests the market may be shifting toward a different kind of picture that can be fitted into a still-forming culture of the coming new era.

In a Faceoff, the Masters Trump Picasso (New York Times)

Picasso Work is Withdrawn from Sotheby’s Sale (New York Times)