Art and Book Collecting
From the New York Magazine:
Along with Russian oligarchs and Chinese billionaires, “hedge-fund guys” are cited whenever people try to explain the current art-market madness. The most prominent of them is SAC Capital’s Steven Cohen, owner of Damien Hirst’s shark-for which he paid either $8 million or $12 million, depending on whom you believe-and the would-be buyer, at $139 million, of the Picasso through which its owner, Steve Wynn, put his elbow. Whereas hedge-funders keep much of their day job secret, they often prefer high-profile art acquisitions, because they can boost value-that of the particular work and its artist, certainly, and possibly that of other artists in their portfolio. As Amy Cappellazzo of Christie’s pointed out during Art Basel Miami Beach, there’s a “permission-giving” quality to a deal like Citadel’s Ken Griffin’s paying $80 million for a Jasper Johns, almost five times the artist’s auction record. It creates a new context that makes it seem utterly reasonable to pay $8 million for, say, a Basquiat. “The big fear,” says one art consultant who has several hedge-fund clients, “is that if the market turns, they’ll get out of art just as fast as they came in.”
One of the things I want to do some time in the future, is buy art pieces that I like. I just happen to appreciate art, all the more because I'm terrible at it. My philosophy is that hobbies should pay for themselves where possible. So in this context, I would be looking at up and coming artists whose art work is affordable and has upside potential. I would love to identify and buy art I could sell at mad prices later on. I don't profess to know much about the art market even after sitting in an art investment seminar given by a couple of art dealers, but I think attending the next Sotheby's auction might prove instructive.
One of the clients had a collection of bronze "antiques" that he paid more than $50K for. No certificate of authenticity, and there were signs of mould everywhere. Did he get an art valuer to verify? No. He just bought the whole collection from a ship captain directly. I'm just amazed there are people who'd make purchases like that. Don't get me wrong, I'm not opposed to crazy buyers who are willing to fork out a lot of money, but it's just pretty amazing to me. They might be genuine antiques that were sold for a song but I have some doubts about that.
On another note, I read that a first edition, autographed copy of the first Harry Potter book was sold for ₤ 19K just recently. Pretty good gain considering the original book probably retailed for under ₤ 20. I wish I could sell off my books for that much money. I think that might make me a bit happier about spending so much money on books.