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From: Disqus <[email protected]>
To: [email protected]
Sent: Thu, November 29, 2012 11:41:35 AM
Subject: [artcrit] Re: Finally</>
John Link wrote:
The day to day job of a high level art dealer is to cultivate relationships
with
those who are able and willing to play, and to keep them in the game. Their
ultimate job is to bring new members into the group. An expanding universe is a
fertile universe. The role minor arts, such a pots, prints, and the like play
is
to form a base so those who play in the ether don't become completely detached
from reality, whatever that is. When the owner of a $75 million Rothko gets
nervous he can say it is worth that much because someone else's Japanese pot is
worth $250,000. Dealers are responsible for keeping all these balls in the air,
at once.
What happened to Larry Salander is tied to the fact art is not quite a
security.
One share of Company XYZ is very abstract and useful, at most, for generating a
dividend. But not even that is required. So short sellers can "borrow" my share
of XYZ and "sell" it to you, and both of us are considered to own an entire,
integral share of XYZ. And such sales are legal!
But art gives us great joy and satisfaction in itself; it is not a tiny
abstract
"part" of something huge that has little if any bearing on the whole
enterprise.
Rather it has integrity, it is the whole thing or it is nothing. Salander
depended on the security-like behavior of art prices to get him through the
schemes where he sold more than 100% of an art object to several individuals.
The fact of multiple ownership let him off the basic requirement to transfer
possession of the object as part of the sale. (Sales of securities no longer
involve transference of physical pieces of paper.) With several owners they
understood only one could possess the object at a time, and that seemed always
to be Salander. But at its base level, the scheme was one of investment, not
enjoyment or even basic ownership of art. Then he got greedy, selling more
non-existent parts than the rising market could accommodate when payouts were
mandated. In a way he was selling guaranteed calls in a world where nothing is
guaranteed. But if he had restrained himself to just a few of these
unscrupulous
"sales" I think he would have gotten by with them. The rising market could have
absorbed them and no one would have been the wiser.
I think the same for Mr. Madoff. A rising securities market permits a certain
amount of what he did to go unchallenged, probably more so than an art market
because securities are more ephemeral than art. He just got too greedy and the
numbers were no longer there when people wanted to cash out.
In math, a derivative is a measurement of the rate of change. They are abstract
and not remotely real, compared to dirt or art, which are real. The metric
behind art evaluations looks more and more like the derivative of its price
history than its merit as art. Even though derivatives are unreal, they are
quantities, and therefore easy to measure and grasp. Art as art is real,
though impossible to measure and difficult to grasp. When Warhols go for
magnitudes more than Titians, I'd say art as derivative has gotten the upper
hand. Titians are better than Warhols - check. Titians have stood the test of
time longer than Warhols - check. Titian's are much less available than Warhols
- check. Titians are therefore much more expensive than Warhols - NOT.
Art dealers are an important part of the art system. But as I believe
Chesterton
said: Things by their nature tend to get worse.
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