Bullish on Art

Van Gogh: $12 million. Rembrandt: $13 million. Vermeer: $30
million. Gauguin: $39 million. You wouldn’t guess it from these
rock-star price tags, but all these artists died in poverty. And
for every Gauguin that now sells for a mint, there are thousands of
Robert Bevans. The obscurity of Gauguin’s friend and contemporary
matches his postmortem earning power. Bevan is known chiefly for
his renderings of horses, which still sell for just a few thousand
dollars apiece.

Concerned that most artists still starve, even when their
paintings eventually fetch millions, a few financial wizards have
hatched a plan to erase the words died in poverty from the
artistic vernacular. They’ve created an artist pension trust, a
kind of 401(k) that asks participants to contribute not their
earnings, but their art. According to Wired (April
2005), an artist contributes a piece of work, and managers decide
when the time is right to put it on the market. The proceeds are
then divvied up: 20 percent for fees, half of the remainder for
whoever created the work, and the rest divided among all the
artists in the fund.

Of course, it’s one thing to hedge 249 Bevans against one
Gauguin. It’s quite another to choose 25 virtually unknown artists
and hope that one or two nail the art-market jackpot. Yet that’s
just what investors Moti Shniberg and Dan Galai are doing, with the
help of David Ross, former director of the Whitney Museum of
American Art, who tells Wired, ‘It’s all about finding the
X factor. X doesn’t equal talent. . . . X equals the potential to
hit it big.’

Free-market speculation has always been an aspect of the art
world. But Shniberg and company, while they’re more altruistic than
most investors, are part of a larger trend to, as Suzanne McGee
puts it in Barron’s (April 18, 2005), ‘treat art
as you would any other asset.’ Several start-ups with high-power
pedigrees (Merrill Lynch, ABN Amro, Christie’s) are hoping to do
for the art market what mutual funds and similar investment
vehicles did for the stock market. They want to convince investors
to put their money ‘not in a single sculpture to stand in your
entrance hall but in a diversified pool run by savvy managers with
decades of experience.’ In this case, of course, the beneficiary
isn’t the artist, but the investor.

The prolonged downward spiral of the New York Stock Exchange has
many moneybags poking around galleries looking to unload a few
bucks they might otherwise have spent on oil stocks. In 2004, sales
at the art auction house Sotheby’s set records across the board
(and drove the company’s stock prices higher). Moreover, recent
research shows that the kind of diversified art fund examined by
Barron’s might, in fact, outperform stocks. Two widely
cited studies have tracked decades of art sales against the S&P
500. Their conclusion: Art wins. The implications are interesting,
to say the least. Art history requirements for MBAs? Or how about a
trading floor for artistic futures?

And what about that starving artist stereotype? Could a fat and
contented Gauguin (who, incidentally, gave up a career as a
stockbroker for art) have painted as well as the syphilitic and
suicidal wreck we know and love? Shouldn’t you suffer for your art?
‘It’s silly to say someone is a sellout,’ asserts the critic Lucy
Lippard. ‘Everybody is a sellout. Art has no context in this
society, so it’s forced into the capitalist context, the
marketplace. The only way to be supported is selling it — that
goes for people who are selling it on the side of the road up to
the most famous galleries in the world.’

The real disconnect, in other words, is between this economic
reality and the impulses and imperatives that inspire art in the
first place: Art is a product of creativity. Creativity is a
manifestation of a range of desires — from self-expression to
formal concerns to cultural critique. What’s not clear is whether
creativity can survive the pressures of the marketplace.

Of course, popular music, Hollywood films, television, and even
commercial advertising are all products of the marketplace. So
maybe the real question is whether we want to further conflate the
categories art and market-driven culture. Or,
more to the point, if we want Wall Street brokers to be
tastemakers.

Joseph Hart is a contributing editor of Utne.

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