Last week Ed Winkleman brought to my attention an article by Bloomberg arts reporter Katya Kazakina who suggested that a new breed of speculator collector is out there, buying and flipping work, primarily by male artists under the age of 35. [Image: Eddie Peake, Crushingly Hopeless. 2013; lacquered spray paint on polished stainless steel; 39 3/8 x 55 1/8 x 1 15/16 inches. Courtesy White Cube.]
Here are some choice quotes from Kazakina’s depressing article, which outlines how speculators corner the market on an artist’s work, create buzz to manipulate the market, sell the artist’s work at a huge profit, and then move on to a new mark.
“There are people out there pushing these artists like IPOs,” said Miami-based art adviser Mia Romanik, referring to initial public offerings on the stock market. IPOs can produce sizable profits for investors who manage to obtain the shares in the offering. Google Inc. doubled in value two months after its August 2004 debut and is up more than 1,200 percent from the offer price. Such gains also attract IPO flippers, who seek a fast profit by selling the shares immediately after the price surges in the first days of public trading….
As traders seek to lock up profits, a picture can change hands five or six times within a year, Los Angeles-based collector and entrepreneur Stefan Simchowitz . ‘Every time it trades, it creates virality,’ he said. ‘If people think they can make money, they’ll sit down and read about the art.'”
“There is a specific breed of collector who subspecializes in the young, emerging market,” Todd Levin [director of the New York-based Levin Art Group] said. “In some cases, they work very hard to acquire positions in these artists, purchasing large numbers of their works.”
One of the most coveted young artists is Colombian-born, London-based Oscar Murillo, 28, who is known to paint with a broomstick. In 2011, his works were priced from $2,500 to $8,500, according to dealer Francois Ghebaly, who sold them at a Miami art fair.
Last year, 24 Murillo pieces generated a combined $4.8 million at auction, according to Artnet. The priciest was the 2011 canvas Untitled (Drawings off the wall) marked with doodles, dirt and stains, which sold for a record $401,000 at Phillips in New York on Sept. 19. The consignor acquired it for about $7,000 in 2011, according to Simchowitz, meaning a profit of 5,600 percent…
Allan Schwartzman, a New York-based adviser, said he senses “hunger and excessive cash and lack of discernment” in the market. “I would be concerned about any artist whose prices shoot up 10 or 20 times in a short period.”
When tastes shift, artists whose prices zoomed often are unable to sustain the momentum….
And then the article ends on this sour note, another quote from Todd Levin:
The road is littered with people who’ve been chewed up and spit out.
I’d agree with Parker Ito, the only artist quoted in the article. “I kind of wish my work wasn’t at auction. I am too
young. It’s a sign of how ridiculous the art world is. It’s like market
Among the “hot” painters mentioned in the article are Kour Pour, Alex Israel, Christian Rosa, David Ostrowski, Parker Ito, Eddie Peake, Oscar Murillo, Ryan Sullivan, Israel Lund, Lucien Smith and Fredrik Vaerslev.
Parker Ito, The Agony and the Ecstasy, Installation view at Stadium Gallery (New York), 2012. Courtesy of Steve Turner.
Christian Rosa, Untitled, 2013, oil, crayon, and charcoal on canvas, 71 x 79 inches. Image courtesy of Paddle8.
David Ostrowski, F (Sarah Silverman), 2011, oil, lacquer and paper on canvas, wood; 71 1/4 x 51 1/2 inches. Courtesy of Simon Lee.
Fredrik Vaerslev installation at Andrew Kreps, 2013.
Ryan Sullivan. Image courtesy of Sadie Coles.
Lucien Smith, installation view OHWOW.