Bloomberg has a history of running stories that don’t quite live up to the headlines but today’s first part of a two-part story stretches the limits of logic. Under the headline, “How Monet, Freud, Hirst Records Led Art Market Bubble to Burst” Scott Reyburn lists a bunch of prices from 2008 with no causative link. The story simply never offers any connection between the record prices and the fall in the market. That’s because both the record prices and the market correction are epiphenomena of something else: global financial liquidity.
But let’s not stop there. When discussing Chinese Contemporary Art, the story tries to put the successful Estella sale of the Spring in contrast to the weak Estella sale of the Fall. Yet, anyone who was following that market knows that the Chinese Contemporary Art market had softened significantly before the Spring Estella sale. The New York Times sent a reporter to Hong Kong specifically to cover a sale that they expected to be a spectacular bust. When the sale did exceptionally well, most market watchers were left in a quandary. The second Estella sale took place in the midst of the worst of the worldwide market shocks. Many works failed to sell but those that did held to strong prices. Again, another confusing set of data points.
Let’s see what tomorrow brings.