[MSN] I don't know much about modern art but I know what it costs

[MSN]

 I don't know much about modern art but I know what it costs

Last Updated: 12:01am GMT 17/02/2008

John Preston reviews The $12 Million Stuffed Shark: The Curious Economics of
Contemporary Art and Auction Houses by Don Thompson

Don Thompson has good advice for anyone who walks into an art gallery with
even vague thoughts of buying a work of art. Ignore the girl behind the desk
who looks at you with withering disdain and says, 'Can I help you?' in tones
that clearly indicate she would much rather be knocking back a bracing
draught of strychnine.

She is only there to reinforce the idea that art galleries are temples of
high culture into which the man off the street should step with fearful
tread. No, bypass her desk and head for the guard - the bored-looking guy in
the backroom who's constantly sneaking glances at his watch. Talk to him
instead; no one else does. But the guard will know just who is buying what,
and for how much. He holds the secrets of the saleroom.

And what secrets they are. According to Thompson, 'The art trade is the
least transparent and least regulated major commercial activity in the
world.'

Anyone can be an art dealer; you don't need qualifications, background, or
any fiddly stuff like that. All you need is capital, something that passes
for charm and boundless stocks of windy guff.

But while Thompson is interested in the mechanics of the art trade, he has
wider - and deeper - questions on his mind. Who dictates what an artwork is
worth? What makes it valuable? How can anyone take seriously the drivel in
auction catalogues about 'meaningful white spaces'?

And then there's the biggest puzzler of all: why are so many people prepared
to stump up vast sums of money for works of art that are unlikely to resell
for more than a fraction of their purchase price?

Thompson - an economist - may be a sceptic about a lot of contemporary art,
but he's not a Philistine. Rather, he approaches the subject of someone who
is both fascinated and baffled by what he sees. He spent a year nosing
around the contemporary art market to see if he too could gaze upon its
inner workings.

Early on in his quest, someone tells him: 'Just remember that the key part
of the word contemporary is temporary.' In other words, most contemporary
art won't last.

It may physically fall apart - as happened to Damien Hirst's original shark
- but even if it stays in one piece, the likelihood is that it will have no
lasting worth, at least in financial terms. Fewer than half of the modern
and contemporary artists listed in a Christie's or Sotheby's catalogue 25
years ago are now offered at any major auction.

If that doesn't freeze your hand in your pocket, then roll this nugget round
the meaningful white space of your mind: of the 1,000 artists who had
serious gallery shows in London and New York during the 1980s, only 20 were
still being shown in comparable venues in 2007.

So what's going on?

In the art world - perhaps more so than any other sphere of human activity -
there are an awful lot of very rich, very gullible people. All are looking
for something modish to hang on their walls, all love having their vanity
massaged by wafflingly effusive dealers.

As for motivation, one should never underestimate the importance of social
prestige here. Last year, one man, who had paid $72.8 million for Mark
Rothko's White Center that had previously belonged to David and Peggy
Rockefeller, was told with evident awe, 'You've just bought a Rockefeller.'

No doubt aesthetic satisfaction plays a part too. But there can also be
surprising incidental benefits to buying big money art. When the California
art collector Eli Broad bought Roy Lichtenstein's painting, I. I'm Sorry,
for $2.47 million a few years ago, he paid with his American Express card -
and in the process picked up 247 million air miles.

Thompson's book starts extremely promisingly; it's lucid, well-researched
and, while carefully balanced, manages to retain a sharp edge. But he tends
to lose both his voice and his way as he goes on.

The awkward - yet pertinent - questions subside and in their place come a
series of fairly routine profiles of auction houses and art dealers.

On the one hand Thompson is clearly addressing people who have some
knowledge of the art market, but on the other he feels he has to explain who
Francis Bacon was. This makes for a rather awkward mix and I kept wishing
he'd put more of himself into it, not less.

Still, he's managed to come up with some fascinating pieces of information.
According to a former director of the Museum of Modern Art in New York,
around 40 per cent of the top end of the art market is made up of forgeries.

For instance, Rembrandt scholars reckon that he only created 320 paintings,
yet at one stage there were 600 Rembrandts hung in museums around the world,
along with another 300 in private hands.

Here, too, Thompson has another handy hint. If you're sitting on a fake
Gauguin, say, and want to get rid of it, head for Japan. Apparently Japanese
buyers feel ashamed when they find out they've been defrauded and are
unlikely to go to the police.

http://www.telegraph.co.uk/