[intro]An active collector sent us this think piece on the benchmark sales just winding up:[/intro]
Let’s try to make some sense of what occurred at auction the past two weeks. A quick synopsis:
1) The financial market crash of last autumn clearly spooked the art market, and to such an extent that the auction sales of October-December tanked. Estimates for those auctions were already baked in, and reflected the prior bull market’s pricing. But nervous, fearful buyers obviously stayed away in droves and the auctions performed abysmally.
2) Sellers remained somewhat delusional through and into the Spring of 09, such that they still were overestimating the value of their art (both at auction and privately.) Nervous buyers held back (at auction and privately), thus continuing the downward spiral of sales. In response, sellers were taking a pass which depressed the quality of works that were being made available at the new price level from Spring 09 through even the present time.
3) Auction houses, now more fully in control of at least their own expectations, began to force reductions in estimates and reserves, and they drastically changed the type and tone of the work they accepted for their Spring and Fall 09 auctions. A new “bottom” was in the process of being found and created, assisted by a more rational buying and selling paradigm at major art fairs, where work was more languidly sold and more flexibly priced.
4) The economy begins to stabilize in Fall 09, especially in the eyes of the art-buying class, notwithstanding various troublesome indicators (e.g., spiraling unemployment.) Auction houses are now fully in control of their own destiny, accepting works for their major auctions in such a way that the catalogues resemble those of 15 years ago, thinner and filled with reliably blue chip art from the 40s, 50s and 60s. Many of the new hot artists are either relegated to the sidelines or their exposure at auction severely limited. Auction results are relatively buoyant and confidence is restored to a more reasonable level.
5) The bargain window, at least at auction and perhaps privately, has now closed.