Weak Results at Wednesday Sotheby Art Auction Relating to Credit Issues

Not to say that it wasn't art...

 

I must be a total calvanist...

I have a hard time understanding a piece of art work costing 20-30 million dollars...

I always look at it this way:

1) How much would it cost to reproduce/rebuild?
2) How easy is it to copy?
3) How much joy will I get out of it, versus a cheaper version?

I can understand a ferrari for over 1 million. As, an accurate reproduction would likely cost nearly as much. I can drive it, and there isn't a direct cheaper replacement.

Now, lets look at artwork...

I can hire an artist, even the best in the world, to make a perfect copy, for much much less...

I can go to the art museum, and get a print...for much much less....

The joy of the think is fleeting glances at a wall...

Art work has little intrinsic/material value. Its entire "value" is determined by what folks think of it at the moment. Its essentially artificially determined.

I understand it cannot be replaced, and has historic value - and thats what you are paying for...but this doesn't extend to modern art. Modern art has zero historic value, yet folks pay a bundle...


Someone explain it to me... Perhaps I just haven't achieved the appropriate amount of wealth, and when I do, an epiphany will occur...

 

Art appreciation is a very subjective thing. There are those that love the painting, sculpture or whatever purely because it causes an emotional response. There are others who see art as simply another commodity to be bought and sold. You could hire a painter to copy a well known painting, but you will have only a mechanical copy with no emotion from the artist attached to it, you might as well buy a print.
I think everything that is collected or will bew collected has an artificial "value", that being whatever the collector is willing to pay to own their desire. It doesn't take wealth to appreciate the art, however purchasing art is a different story, especially works by famous, dead artists. I think historical significance is only a small part of art appreciation with the major part being the emotional attachment the work provokes. Ferraris are in a similar position today, with values being artificially raised to the point only the wealthy or super-wealthy can afford to buy the significant models. And with Ferraris, historical significance is more important because it adds to the perceived value of the car.
Basically, emotional response is at the heart of both art appreciation and Ferrari appreciation, as both affect people in a totally illogical way. This is just the opposite of the investor-collector where only dollars matter and the only appreciation is the value going up. Now there are collectors who are buying both for the emotional response and the possible increase in value in the future. I love both art and Ferraris and will never be able to afford to own either, but the appreciation is still there.

 

I agree with davidgoerndt. Art asks for a conceptual rather than literal appreciation. A literal appraisal of a Jackson Pollock is seventy dollars worth of materials thrown together at a labor rate of, say, one hundred dollars per hour pro-rated at forty-five minutes. Conceptually, we see a lot more and value it accordingly. The consensus of the market bears on this, but usually after a conceptual acceptance has occurred.

 

About 10 years ago there was a huge Monet exhibition iin Chicago that I was lucky enough to go to. It was the largest collection of Monets in one place ever, and I fell in love. I didn't know until then that many of his paintings were duplicated by him in different colors and styles over his lifetime; seeing them all lined up told a story that seeing them by themselves could never have done. The ones of his garden that were very realistic when he painted them as a young man, to the one just before he died which was almost just a blur of color was my favorite series.

If I were a man of means, I'd have not one Monet, but 4-5 of one of his serial subjects, and yes I'd pay however many millions it took.

Ken

 

Sure you can! Maybe not Monets and 288 GTO's, but there are some unknown artists out there that are collectable and not expensive. I myself collect pictorial maps by Ernest Dudley Chase. I started by accident 25 years ago when I bought a lithograph of his map of France for $15 at a yard sale. I later learned he did 50 such pictorial maps; Harvard Library owns many of the original water colors of them and did a show in 2003 of the entire series. I now own 5 Chase maps of which one is the original painting called "Loveland". Harvard had a litograph of that one at the show! LOL I paid less than $100 for it too. I considered asking Harvard if they wanted to make me an offer but truthfully I don't want to sell it. It would take stupid money for me to change my mind. I hope one day to have all 50 but some are excessively rare even as lithographs. When they turn up though, they don't seem to sell for much.

Ken

 

Was at Ferrari?

 

I usually do not do this - told u so etc...
But i was concerned enough this week, that i felt like i had to tear up my bank deposits and buy t-bills.
If you think im out of line - i certainly hope im wrong about my gut feeling - then ok, but in this environment and this atmosphere, if this weekend's auctions don't reflect the new economic reality - deep recession and getting deeper by the minute, then either: they are rigged, or buyers have lost their sense of smell.
Either way, i would eject all collectibles/hard assets, not to mention automobiles that went up 200% in the past 24 months.

There is - to my mind - something like a 5% probability we enter into a financial meltdown in the next 2 months, the magnitude of such has not been experienced in the past few generations. I wouldn't want to own these beautiful red things but rather have direct access to the smelly greens.

hope im not correct in 3 months.

now; after my speech - does anyone actually have results from today's RM auction?

elad

 

I saw some of the RM auction online.

Prices were strong. Hammer prices:

308 GTB - $60k

Daytona - $340k

275 GTB - $1.25M

 

some other numbers -
1952 Glockler-Porsche sold for 560k (estimate 600-800k)
1977 Maserati Merak SS sold for 38k (estimate 40-50k)
1963 Shelby Cobra sold for 1.575k (estimate 1.75-2.25k)

Some other cars as well performed 20-30% below lower estimate (if you factor in that the sold prices are with a 10% commish)...
I guess with the exception of the 275GTB and some other sporadic sales, the market is moving lower.

i would say - as i guess some have stated as well - that the market will first deflate the peripheral cars, then the Ferrari hoard, then the blue chip stuff.

lets see how Gooding fairs tonight
elad

 

Honestly, now, there were more than enough stellar results in yesterday's sale to counteract whatever mediocre results you can pull up. A '56 Speedster for over $200K? A 300SL conv. for over $700K? You can prognosticate all day long and you are wrong, until you are right. Even a broken clock is right twice a day. But, the question I have for you is, do you even care at all about vintage Ferraris? Or just about proving that you are smarter than the rest of us who have paid our money to have something we love in our garages?

Michael

 

calm down, as it stands i paid to have my garage interesting for myself.
its still not clear to me after reading your post three times, are you trying to say that Collector car values are holding up? or just trying to be devils advocate?

i do care about Ferarris and other works of art and def not trying to prove anything (not to you at least), but to help complete a thread that generated enough interest on this topic.
anyhow, its not who is correct, its just opinions. i guess you are of the school that whatever goes up must continue to go up...
good luck.

 

Just because a deep recession is coming and the US is headed for a currency system debacle does not mean collectible Ferrari prices are destined to crash. In fact... why would you WANT to be liquid in dollars when the dollar is what is going to get hurt the worst?

I am not saying that collectible Ferrari prices are going to keep going up at the pace they have over the past 24 months because I believe they will not and we have probably seen a peak or are real close. But the key to this will be the dollar and the intermediate to longer term global effects of a deep US recession. If Europe and Asia manage to not get dragged down as well.... then the weak dollar will drive foreign buying of all "wealth" assets here in the US.

Personally, I think the US weakness is going to be very bad and it will lead to a global downturn that will dry up the collectible car markets (to what level is anyones guess). But, that does not mean being liquid in dollars is a good move. The dollar has nowhere to go but down.

Personally... I think tangible income producing investments are the place to be. I am looking at lower end, cheap single family homes for rental. The rental market is very strong and real estate is at least somewhat protected from a hyperinflationary scenario.


Terry

 

1952 Glockler-Porsche sold for 560k (estimate 600-800k)


Was a no sale at $680 2 years ago. Maybe the market just doesn't like the car?

 

The reason you couldn't determine from my post whether I was saying values are going up, going down or stagnating is because I was not attempting to issue an opinion on that subject at all. As with many owners who bought a nice vintage Ferrari in the past 5 years, my car is now, at least theoretically, worth nearly twice what I paid for it. However, as with many of the posters on this board, I was not counting on the theoretical proceeds from this appreciation to feed my family or pay my mortgage over the next 24 months, and a drop in values that resulted in the car being worth, once again, what I paid for it (or even $100,000 less) would not change my appetite for ownership. I doubt that too many other members here feel very differently, and I further doubt that many of the folks in these parts will not have cash to pay their fixed costs even should we enter a prolonged recession.

Michael

 

This comment is way late to this thread, but IMO the easiest way to appreciate how a painting can be worth multi-million sums is to visit Musee D'Orsay in Paris. The museum is full of beautiful paintings, but the Van Gogh section almost seems a breed apart. Everyone's tastes vary of course, but it's difficult not to be moved with Van Gogh and the way his work stands out in that setting.
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How long do you see the downturn?

 

Perhaps we should ask the Japanese.

 

Art Sales Last night were pretty good.

 

While I think it is valid to keep their situation in mind, I think the US has an especially heterogeneous population so I doubt many people would share the same economic outlook for long.

 

Your replica would be ordered destroyed in Italy.

 

"While the male humans' attraction to automobiles is primitive and basic"?

Wait did you just call all most everyone here basic and primitive? lol.

 

Yes, their downturn was based on an initial downturn in real estate banking just like USA has now.
10 years is very long for the Japonese