Has The Art Market Hit A Top? Finding An Answer In 1 Chart, And 4 Masterpieces
Has the art market topped out now that yet another record has been set for a sold masterwork?
Recently, at a private auction in Switzerland, Gauguin's, “When Will You Marry?” depicting two Tahitian girls, sold for a record $300 million.
The art market tends to peak pretty much when the global economy peaks, something we can see in the price history of Sothebys (NYSE: BID), one the world’s two premiere auction houses.
Whether it was Van Gogh in 1990...
Cezanne in 1999...
...or Pollack and Klimt in 2006...
...art market tops appear coincident with other market tops, as well.
Whether it was media magnates, buyout barons, hedge fund titans or Russian oligarchs, each cycle had its unique set of patrons.
The Russians appear to be on the run, of late, reportedly backing out of pricey New York real estate deals, to save a few rubles for a rainy day that has already arrived.
Without the marginal bidders, can masterworks command increasing premiums in the world of fine art? Hard to say, but one has to wonder if we are witnessing yet another peak in the price of art.
With that in mind, one should note that Sotheby’s shares tend to peak around the same time. That’s despite the fact that Sotheby’s has not taken out its previous stock market highs from two prior cycles.
I’m not sure I want to short that stock just yet.
But as I stop to admire the art of the great masters, I also want to take a more critical look at Sotheby’s shares, just to make sure I can appreciate whether all the good news has been painted onto its stock market canvass.
Image credits: Webneel
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