James Stewart is an extraordinarily talented and accomplished financial journalist whose work ranges from investigative to narrative to writing a regular investment column charting his own trades and trading philosophy. His recent column on the art market, did him little credit, however; mostly because he tried to make the case that beneath the headline-grabbing prices the rest of the art market was soft.

Felix Salmon rightly takes Stewart to task for a number of failures but this one seems the most serious. The crux of Stewart’s complaint is that not all works are selling at tremendous prices. But the necessary ingredient of a healthy market is discrimination. If all works sell well, there’s no market just a mad rush to acquire an undifferentiated mass of work. And that would be the worst sign of all for art.

Here’s Salmon on the painting Stewart uses to make his case:

when Stewart bemoans the fact that Sanford Robinson Gifford’s “Sunday Morning in the Camp of the Seventh Regiment” went unsold against a low estimate of $3 million, he doesn’t consider that maybe that’s just because the sellers — New York’s Union League Club — were simply asking for too much money. After all, as Christie’s itself said, if the painting had sold, it would have set a new auction record for Gifford. I’d also note that the painting has more historical value than aesthetic value just look at the thing, and that at 16 ½ x 30 inches, it’s a pretty small trophy for any well-heeled collector of Americana. A “masterpiece”, in Stewarts words, it isn’t. If you wanted a Gifford this week, you could have picked up a much more beautiful one at Sotheby’s for a six-figure sum — which implies that the Christie’s painting was simply overpriced, in the hope that someone would pay through the nose for it just because it had once hung in the Oval Office.

Adventures in art-market commodification, James Stewart edition (Reuters)