We all know what fiat money is now, so we can go on and talk about other stores of wealth. In review, fiat money is paper money that is printed, in our case by the government. Take out a piece of paper money and check the words at the very top, FEDERAL RESERVE NOTE. That is what all are money is, except if you have lots and lots of money, you may want to place your wealth into other forms of "money".
Real estate while a good thing to own, if purchased at the right price, is not exactly a very exchangeable form of money. One of the chief characteristics of money is that it facilitates the exchange of a products and services. Works of art, paintings or prints, can become a form of money if they are readily convertible into a more useful medium such as FEDERAL RESERVE NOTES or other foreign currencies. Diamonds and other precious stones have substituted for money when taking money out of a country was forbidden. There is always a way around the law. Before WWII (World War Two), Jews that wanted to leave Germany were restricted as to how much cash they were allowed to take with them. Some people that had the money, converted their money into diamonds and sewed them into their clothes so they would have something to exchange for money when they got to where they were going. We all know that you can't eat money, but you need money to eat.
In my effort to sell a few of my sunflower prints, I emailed several people that I knew about the present print sale. Some people informed me that they were not in the art market. I understood what they meant, but my sunflower prints for $50 is hardly what I think of as the art market. I wish my art was a part of the art market. The real art market has collectors buying art with price tags of several millions of dollars. Why are people buying art and paying millions of dollars even for contemporary art at auction? The answer gets back to not putting all your eggs in one basket. (I am surprised that Jeff Koons hasn't done a basket with eggs yet to go along with his balloon dogs!) When people have great wealth, they spread that wealth around. They diversify their portfolio into items that maybe called near money. Art that sells in the millions, in my opinion, is near money. It may take until the next auction, but art selling in the millions can be sold, sometimes at a loss, but, nevertheless, for enough to buy a few meals in a pinch.
Stay tuned.
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2 comments:
The art that sells for big money is often associated with big names. People seem to be buying the name, rather than the art.
In the late 1970s, a big foundation donated a sculpture named India to our local university. They paid over $50,000 for it and someone questioned whether it would be worth that. The response was, "it's a good deal for an Anthony Cario sculpture."
Have a big name and your art becomes expensive.
Hi Fred,
Ahhhh the art market is certainly a minefield! Fashion, big names [artists and dealers can both gain almost celebrity status], prizes, money etc etc all play their part in creating the 'art market'. A great book to read is 'Seven Days In The Art World' by Sarah Thornton. She spends a chapter on various subjects from the auction house, the dealer, the artist, the art school etc.
Fred, I too wish my paintings sold for millions! But, I hope more that history judges my paintings as saying something. Both would be cool though!
Kathryn
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