Nov 18

Financial Crisis and the Art Market (I)

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Francis Bacon

Francis Bacon

The record achieved on November the 13th by a work of Francis Bacon, Three Studies of Lucian Freud (1969), in an auction held at Christie’s, New York, has caused widespread astonishment, featuring on the front pages of newspapers, and, above all, it has revealed to the public just how juicy the art business has become and to what extent it´s profits have and continue to increase even in these times of economic uncertainty.

The auction set an astronomical price, 142.4 million dollars, the highest ever paid at public auction, and the third highest throughout history, beaten only by The Card Players (Paul Cézanne, 1890), which sold for 191.6 million euros, and The Dream (Pablo Picasso, 1932), sold for 116 million euros, both works adquired by private sale.

Three studies of Lucien Freud (1969)

Three Studies of Lucien Freud (1969)

At the same time, the opening of new markets in the Far East as well as the multimillion-dollar promotion of new artists from those emerging countries deserve some considerations. Large auction houses open branches in continental China (Sotheby’s in September of 2012 and Christie’s a year later) that serve to raise altars to local artists. Perhaps more surprising than the auction of the Bacon, is the price reached in October 2013 for The Last Supper, by the Chinese artist Zeng Fanzhi (born in 1964), and based in Beijing, which recreates the homonymous painting of Leonardo da Vinci, where guests eat watermelons. The 23.3 million dollars paid in Hong Kong for the painting, through Sotheby’s, reveal that the art bubble is far from bursting and that, on the contrary, a gap has even opened for the works of “unknown” living authors.

The Last Supper by Zeng Fanzhi

The Last Supper by Zeng Fanzhi

It is significant that the same day that the news of the bankruptcy of Lehman Brothers became known, in September of 2008, the versatile British author Damien Hirst (born in 1965) established a record at Sotheby’s with the sale of 200 works for 177 million dollars.

All of this adds to the panic caused in some countries, such as Spain, by the excessive exportation of works of art, which disappear without a trace, lost due to the weakness of national economies and the thriving market of investors, eager collect new works. Not long ago, I was interviewed on this matter by the newspaper “Veinte Minutos” after the auction of a painting by Sorolla in London.

However, all this flow of capital has been of no benefit to the general public, whose opportunities to enjoy these works have declined drastically due to lack of public funding and private exhibition sponsorship. Carmen Giménez, curator of the Guggenheim in New York, said in an interview to the EFE agency, in August 2013, “to get 1 or 2 million dollars (0.7 or 1.4 million euros) for an exhibition is much more difficult now than ever before”.

The global economic crisis and the effervescence of the art market, even though they might appear to be contradictory events, are perfectly intertwined, as we will explain in part two of this article.

Three studies of Lucian Freud, Francis Bacon (1969)

Three studies of Lucian Freud, Francis Bacon (1969)

 
Antonio Pedro Rodríguez Bernal
Lawyer and renowned specialist in the law applicable to the art market, historical heritage and antiques. He has participated in numerous international transactions of valuable works of art, either as a lawyer of the parties or of the participating dealers. He is frequently invited to radio programmes or interviewed in the press to discuss current issues relating to the Law of art, historical heritage and antiques.
Email: info@rodriguezbernal.com

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