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发表于 2009-12-20 00:57:18
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A special report on the art market
Suspended animation
Nov 26th 2009 From The Economist print edition
生词
读多遍才懂的句子
好句子，好表达法
====================================================
The art market has suffered from the recession, but globalisation should help it recover, say Fiammetta Rocco (interviewed here) and Sarah Thornton
Sothebys
THE longest bull run in a century of art-market history ended on a dramatic note with a sale of 56 works by Damien Hirst, “Beautiful Inside My Head Forever”, at Sotheby’s in London on September 15th 2008 (see picture). All but two pieces sold, fetching more than £70m, a record for a sale by a single artist. It was a last hurrah. As the auctioneer called out bids, in New York one of the oldest banks on Wall Street, Lehman Brothers, filed for bankruptcy.
The world art market had already been losing momentum for a while after rising vertiginously since 2003. At its peak in 2007 it was worth some $65 billion, reckons Clare McAndrew, founder of Arts Economics, a research firm—double the figure five years earlier. Since then it may have come down to $50 billion. But the market generates interest far beyond its size because it brings together great wealth, enormous egos, greed, passion and controversy in a way matched by few other industries.
In the weeks and months that followed Mr Hirst’s sale, spending of any sort became deeply unfashionable, especially in New York, where the bail-out of the banks coincided with the loss of thousands of jobs and the financial demise of many art-buying investors. In the art world that meant collectors stayed away from galleries and salerooms. Sales of contemporary art fell by two-thirds, and in the most overheated sector—for Chinese contemporary art—they were down by nearly 90% in the year to November 2008. Within weeks the world’s two biggest auction houses, Sotheby’s and Christie’s, had to pay out nearly $200m in guarantees to clients who had placed works for sale with them.
The current downturn in the art market is the worst since the Japanese stopped buying Impressionists at the end of 1989, a move that started the most serious contraction in the market since the second world war. This time experts reckon that prices are about 40% down on their peak on average, though some have been far more volatile. But Edward Dolman, Christie’s chief executive, says: “I’m pretty confident we’re at the bottom.”
What makes this slump different from the last, he says, is that there are still buyers in the market, whereas in the early 1990s, when interest rates were high, there was no demand even though many collectors wanted to sell. Christie’s revenues in the first half of 2009 were still higher than in the first half of 2006. Almost everyone who was interviewed for this special report said that the biggest problem at the moment is not a lack of demand but a lack of good work to sell. The three Ds—death, debt and divorce—still deliver works of art to the market. But anyone who does not have to sell is keeping away, waiting for confidence to return.
The best that can be said about the market at the moment is that it is holding its breath. But this special report will argue that it will bounce back, and that the key to its recovery lies in globalisation. The supply of the best works of art will always be limited, but in the longer run demand is bound to rise as wealth is spreading ever more widely across the globe.
The World Wealth Report, published by Capgemini and Merrill Lynch, charts the spending habits of the rich the world over. It includes art as one of a range of luxury items they like to buy. According to the report, in 2007 there were over 10m people with investible assets of $1m or more. Last year that number dropped to 8.6m and many rich people scaled back their “investments of passion”—yachts, jets, cars, jewellery and so on. But the proportion of all luxury spending that went on art increased as investors looked for assets that would hold their value in the longer term.
The regional spread of buyers also changed significantly as some parts of the world became relatively richer. During the boom the number of wealthy people in Russia, India, China and the Middle East rose rapidly. In 2003 Sotheby’s biggest buyers—those who purchased lots costing at least $500,000—came from 36 countries. By 2007 they were spread over 58 countries and their total number had tripled.
That upward trend is still continuing, and many of the new buyers take a particular interest in the art of their own place and time. Last year China overtook France as the world’s third-biggest art market after America and Britain (see chart 1), and some 25% by value of the 100,000-plus works of art sold by Christie’s went to buyers from Russia, Asia and the Middle East.
Auction records remain dominated by Impressionist and modern works (see table 2), but the biggest expansion in recent years has been in contemporary art. Prices of older works keep going up as more people have money to spend, but few such works become available because both collectors and museums tend to hold on to what they have. Old Master paintings, for example, have stuck at around 5% of both Sotheby’s and Christie’s sales for many years. By contrast, contemporary art, which in the early 1990s accounted for less than 10% of Sotheby’s revenues, grew to nearly 30% of greatly increased revenues by last year. Dealers and auction houses now sell more post-war and contemporary art than anything else. This report will concentrate on that part of the market, which accounts for about half the world’s art trade and most of the excitement.
Part of the extra demand has come from a large increase in the number of museums. Over the past 25 years more than 100 have been built, not only in America and Europe but also in the sheikhdoms of the Persian Gulf and the fast-growing cities in Asia; sometimes in partnership with Western institutions, such as the Guggenheim or the Louvre, sometimes on their own. Many of these institutions have made their mark by buying contemporary art.
Over the same period the number of wealthy private collectors has also increased many times over, and so has their diversity. The record price for one of Andy Warhol’s giant faces of Chairman Mao was $17.4m, paid by Joseph Lau, a Hong Kong property developer. It was the first major Warhol to go to the Far East. A month later the Qatar royal family bought a Hirst pill cabinet, entitled “Lullaby Spring”, for £9.7m, the first major Hirst bound for the Middle East. Everyone wants an iconic work, which helps explain the global demand for artists such as Warhol, Jeff Koons and Mr Hirst—and the eye-watering prices such work can command.
Masters of the art universe
Straddling all areas of the art market is a handful of individuals who have emerged as the key figures in the art world in recent years. Chief among them is François Pinault, a luxury-goods billionaire who is also a noted collector of contemporary art and the owner of Christie’s. Philippe Ségalot, his French-born adviser, was behind one of the biggest deals involving a single work of art, the private sale of Warhol’s 1963 painting, “Eight Elvises”, to an anonymous buyer for over $100m.
Mr Ségalot is also believed to be advising the royal family of Qatar, which in the past two years has spent large sums buying modern art at auction, including record-breaking works by Mark Rothko and Mr Hirst. Steven Cohen, an American hedge-fund billionaire, also owns works by Warhol, Mr Hirst and Mr Koons. Mr Cohen used to be a sizeable shareholder of Sotheby’s and is still an important provider of liquidity to art buyers.
The popularity of blockbuster art exhibitions and the emergence of buyers with a different cultural history have helped change tastes. Artists such as Edvard Munch and Vasily Kandinsky rose sharply after solo shows in London and New York. Alexei von Jawlensky and Emil Nolde were regarded as specialist interests until Russian collectors began seeking them out. Zhao Wuji used to be just another Chinese painter-in-exile; now he is recognised as an Abstract Expressionist master influenced by Paul Klee and praised by both Joan Miró and Pablo Picasso.
How to sell it
One of the biggest changes since the market last peaked in 1989 has been the expansion of the auction houses and the change in the nature of the dealer business. Twenty years ago auction houses sold to dealers, and dealers sold to private customers. Today many collectors are advised by auctioneers, both at sales and privately.
Rising costs brought trouble to many old-fashioned fine-art dealer emporiums. In London Christopher Gibbs has sold his stock and Partridge is in administration. In Paris Galerie Segoura has closed, as has Salvatore Romano in Florence. Many dealers now prefer to take art works on consignment, matching sellers to buyers for a commission rather than investing in stocks of art.
About half the market’s business, reckons Ms McAndrew of Arts Economics, is conducted at public auctions, with Christie’s and Sotheby’s taking the lion’s share. Smaller houses include Drouot in Paris, Bonhams, which is based in London but has several offices abroad, and Doyle in New York. The other half is generated by private dealers and galleries that are notoriously secretive. One of the biggest private deals in recent years came to light only because the details were disclosed in an American court following the Bernard Madoff scandal. Last July ten paintings by Rothko and two sculptures by Alberto Giacometti were sold by a New York financier to help repay Mr Madoff’s investors. A mystery buyer spent $310m on the works. Two dealers earned $37.5m in fees.
By comparison with that private world, Sotheby’s and Christie’s auction business looks like a model of transparency. Although buyers and sellers are rarely named, the auction price is public. Yet even here there are dark corners. The leading auctioneers offer inducements such as guaranteed prices to persuade sellers to part with their treasures, and generous terms of payment for buyers.
One thing that differentiates the two auction houses is their ownership structure. Sotheby’s is a quoted company whereas Christie’s, once listed, was taken private in 1999 by its current owner, Mr Pinault. Christie’s business has since expanded hugely, partly thanks to Mr Pinault’s pivotal position in the international art world. Even though the company can pick and choose what information it wants to reveal, it has in fact become more open over the past ten years.
Sotheby’s, for its part, is still smarting from the public beating it received in America nearly a decade ago when its chairman, Alfred Taubman, and its chief executive, Diana Brooks, were found guilty of conspiring with Christie’s to fix commissions. Mr Taubman served ten months of a one-year prison sentence; Mrs Brooks was given six months’ house arrest, a $350,000 fine and 1,000 hours of community service. No one was charged at Christie’s, which had blown the whistle on the commission-fixing. Sotheby’s lives in fear of the regulators and discloses only as much financial information as it has to.
In the decade since the scandal both auction houses have concentrated on expansion. Sotheby’s was the first auctioneer to become interested in Russia and remains bigger there than its rival. Christie’s, which has long been especially strong in the Far East, has put a lot of effort into China. Foreigners are not allowed to own auction houses there, but Christie’s has got around that by signing a licensing agreement with a leading Chinese auctioneer. Both houses have their eye on the Middle East. Christie’s holds regular auctions in Dubai, of which its art and jewellery sales are the most successful. Sotheby’s has opened an office in Qatar which is important for its relationship with the Qatar royal family, one of its biggest clients.
The response of both auction houses to the current slump has been broadly similar: staff cuts, unpaid leave, a squeeze on salaries, slashed marketing and travel budgets, and an edict that the glossy auction catalogues, which in the boom cost each of them £25m a year to produce, were no longer to be handed out like chocolate drops.
With a hugely expanded international client base, it was only a matter of time before both auctioneers started to muscle in on areas that had previously been the preserve of private dealers, matching buyers and sellers and selling new art rather than items that had already been in the market. Sotheby’s proved to be much the more ruthless of the two. All the lots in Mr Hirst’s September 2008 sale, for example, had been consigned to Sotheby’s directly from the artist’s workshop, which shocked dealers who had not previously thought of the auction houses as direct competitors.
In 2006 Sotheby’s paid $56.5m for Noortman Master Paintings, a leading dealer in Old Masters. Less than a year later Christie’s bought Haunch of Venison, another high-profile dealer set up in 2002, whose founders included a former director of Christie’s contemporary-art department. Noortman gave Sotheby’s an entry into the Maastricht Art Fair, the pre-eminent dealers’ fest, and Haunch of Venison helped make Christie’s Mr Pinault the biggest art trader in the market. Both galleries operate independently of the auction houses, but the relationships are close.
All things to all men
Both auction houses have also put a lot of effort into advising buyers on how to improve their collections. As Jussi Pylkkanen, Christie’s European president, says, “We’re much more than an auction house now.” The recession has made many collectors nervous about offering their treasures at auction, so they are selling them privately. In 2007 Christie’s chalked up private sales of $542m and Sotheby’s of $730m, which means the two auction houses are now among the world’s biggest private dealers. Both often get calls like the one Sotheby’s recently took from a Moscow collector with $2m to spend on an “optimistic” Chagall oil, “not too feminine” and no more than a metre in height. “We put out the word and immediately received several offers from our offices in London, Geneva and New York,” says Mikhail Kamensky, the firm’s head of CIS business.
In 2007 private deals accounted for 8.7% of Christie’s business. Mr Pylkkanen expects that figure to go up to 20% of its revenue within three years. That should put the wind up private dealers.
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fetch to bring in
hurrah EXCITEMENT CHEER
momentum strength or force gained by motion or through the development of events : IMPETUS *the campaign gained momentum*
vertiginous inclined to frequent and often pointless change : INCONSTANT
ego SELF-ESTEEM
demise DEATH
slump a marked or sustained decline especially in economic activity or prices
holding its breath NOT FOUND
lots a number of units （不太确定，求正解）
eye-watering NOT FOUND (惨不忍睹？)
Straddle to stand, sit, or walk with the legs wide apart (这里应该是涉及多个领域的“涉及”的意思)
blockbuster one that is notably expensive, effective, successful, large, or extravagant
lion’s share 巨大的市场占有额
notoriously generally known and talked of / widely and unfavorably known
transparency something transparent; especially : a picture (as on film) viewed by light shining through it or by projection
squeeze to deprive by extortion
chalk up ATTAIN, ACHIEVE *chalk up a record score for the season* （还有ASCRIBE, CREDIT 的意思）
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comments
It took me such a long time to finish this article. Its vocabulary is not that difficult while the sentence structure is pretty much the reason that bothers my understanding. I sometimes come across such situations that no a word is a new one for me but I still have not idea about the whole sentence. I’m wondering if it is my weak grammar foundation that leads to this embarrassing situation. Hope this everyday-reading process may help me improve. Anyway, although I am not familiar with issues on financial market, this article provides me a promising image that the global economy is turning warmer. This is a good news for every one. |
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