Tuesday, April 20, 2010

Baby, Hold on to Me

An interesting article in the New York Times today got me thinking about the rules of art auctions and how they can be a double-edged sword.

The article (which you can read HERE) talks about how collectors (in particular, Craig Robbins, pictured above) who resell artwork they've bought on the primary market (or directly from the artist's representative) on the secondary market (or resale galleries/auctions) can be blacklisted for doing so too soon or even at all.

What's interesting is the way that strict unwritten (or according to the Times, written) rules govern the way collectors are allowed to buy and sell artwork if they want to stay in with the in crowd. It's a terrible faux-pas to resell art too soon after purchasing; it makes the work seem like a financial gamble instead of a masterpiece. It's even less couth to resell a work of art within a few years of being at auction, because, particularly with the growth of sites like artnet.com, the auction record is available publicly and everyone knows on exactly what day the work sold for and for how much--down to the penny.

But the granddaddy of all scarlet letters for artwork is the "BI" (short for Bought-In, or not sold at auction). For the rest of the artwork's life, no matter how lovely and well-priced, the work will always struggle because of its unshakable mark of BI-ness. It doesn't matter why the work BI'ed--there could have been, say, a volcano, that blocked all flights to the auction, or maybe just no good buyers for a very good work with a fair value--people don't want art that has BI'ed

When you think about all the risks involved, it's easy to wonder, why the hell would anyone ever auction off anything? The flip-side of the auction coin is that it can be a great way to raise some quick cash and/or to deaccession works that you just don't have time to deal with. And the there's always the promise of a jackpot--the Picasso or the Doig or the Giacometti that suddenly sells for far beyond the high estimate not only making you rich, but also changing the whole game.