Thursday, 9 April 2015

Searching for the money tree — part three

Rembrandt's Portrait of a boy in fancy costume.
There was quite the buzz in London, fifty years ago, when Norton Simon bought Rembrandt's Portrait of a boy in fancy costume. I remember it well, and for me it epitomised the secrecy and codes within high-end art auctions. I will let Art News tell you all about it. At that time such art auctions were usually held when the average person was at work and only lesser things were sold at evening or weekend auctions. Even an auction catalogue listing could fool most people: if it said just "Rembrandt", it was a copy, if it gave his full name and dates, it was real.

Many years later, I bought an Old Master drawing at Sotheby's by an absentee bid. I had sent in a list of lots and the amount I was prepared to pay for each with the understanding that my first successful bid would cancel all the subsequent bids. Sotheby's handled the task with no problems and I won a French seventeenth century red chalk drawing of Apollo and the Muses. My first choice, though, was a lot of ten old master drawings that were not described, and of course, not illustrated in the catalogue. The high pre sale estimate was only two hundred and I bid three after having them give me a rough description of the drawings on the phone. When I phoned them the next day to see how I fared, I was surprised to hear that the first lot had gone for several times its high estimate. I learned from the man on the phone that such lots were aimed mainly at the local art dealers who would have been in the room. I saw another drawing in the same catalogue: a very small and excellent portrait of a boy that looked a lot like a Van Dyke work but was, again, unattributed. I think that its low estimate was three hundred (my limit) so I placed a bid, although with just about zero hope. It went, if memory serves, for forty-nine thousand. Still, I was very happy with my purchase, even though the shipping cost was exceptionally high and by the time that the invoice arrived, the British pound had shot up from about $1.95 Canadian to $2.35. When I received the drawing, more money went to its conservation framing and anti UV glass (even though red chalk is never fugitive, the paper tone can certainly be affected by light). I decided that collecting old master drawings was just too rich for me, but I did have some success buying undescribed and unillustrated lots of coins for far more than their estimate after hearing about the "local dealer tradition".

Nowadays, the auction market has become far more public and you can bid online at almost any auction in the world. What most people do not know, though, is that the old traditions and customs still persist. To be successful, you still need to be able to read between the lines to a degree. You might think, for example, that if you buy an object in an auction, then you can always return to that auction house for its resale in the future. If you are buying a fairly cheap drawing at a big auction house, you should understand that it was most likely part of a collection that was being sold in that sale: they probably would not have accepted it as single lot.

For ancient coin dealers lots, Sotheby's were a good source: common coins like most tetradrachms of Alexander the Great and Roman and Byzantine gold solidi were traded like commodities with only minor fluctuations in the prices of many large lots in each sale. The higher end coin dealers, too, often sold large lots of ancient coins like a hundred Roman denarii in conditions that were somewhat less perfect than the coins that were sold singly. Again, these coins were collection residues. They would not buy a single example of such a coin from you.

The collector learns about these things through experience, but the anti-collecting lobby among some archaeologists has no experience and cannot be bothered to learn about the culture. They present their criticisms at the public who is even less informed and it becomes a matter of the blind leading the blinder. A wiser archaeologist once told me to take any of their utterances with a grain of salt. For most collectors, such criticism are so beyond any reality that they become a source of entertainment. Setting aside privacy laws, expecting that a dealer would construct a Byzantine system of keeping track of low value coins which would have a history of being sold in unillustrated and undescribed lots in auctions dating back a few hundred years before the Internet and its cost-efficient jpegs is impractical (even if specific records existed). In reality, such things are impossible, they are the pipe dreams of idealists that are praised by the ignorant.

Again, I learned from experience: When I was in the jewellery business, a man stole a diamond ring from me when I glanced away for a split second. There was no one nearby, and when I looked back, I saw a hole in the tray that had not been plugged. The chain store area supervisor was in the shop at the time, so I told him what had happened. He knew that detaining the person could present some legal problems: not more than a year earlier, a jeweller at a nearby store was accused of stealing some gold (he was actually innocent). His boss searched him and found nothing, The jeweller sued and was awarded thousands. So, I followed the the thief to a pawn shop and the police did become involved. I was the main witness at his his trial. Even though describing everything, the judge asked me if the ring design was unique. I told him that it was a design that was not custom, but a standard style of one wholesale jeweller. The judge decided that the ring could not be positively identified as being stolen thus, and the thief was found innocent and got to keep the money from the pawn shop.

If you are purchasing any art object from a licensed dealer and that object is priced less than a couple of thousand, it is very doubtful that a chain of ownership could be traced even if you spent several times that amount trying to do so. You might be lucky once the object passed into the hands of a prominent collector because that fact alone adds value, but that would usually be mentioned in the sale listing, anyway. If they knew, they would tell you (even though they will not mention the name of its current owner without permission). The head of Galba that I mentioned earlier in this series was fifty pounds. I would guess that it would now fetch several thousand. Just because something is expensive now, does not mean that it always has been. Norton Simon spent 2.1 million on his Rembrandt. Can you imagine what that painting would fetch today? for a while, good old master paintings were increasing in price at 25% per annum. Really good coins and artifacts, in the same time period, were going up at about 11% p.a. Lesser, and ordinary objects? well, you don't collect for the investment value right? I once spent a week's wages on a coin that I could buy today for about $200. As Shakespeare said "Costly thy habit as thy purse can buy". Fortunately, I now collect early Celtic art, and unlike most buyers (and sellers), I know what is good. When more people understand it, my heirs might make a killing! Remember rarity is only one part of the equation of supply and demand.

If some anti collecting archaeologists do get their way and many collectors and dealers become paranoid, the market will drop and the safe, inexpensive, items will get even cheaper. This will result in even more young collectors and when they start earning more, the market will bounce back even higher. You notice things over fifty years. So such people do serve a useful purpose, even if it is counter to their intention. Rough coins from archaeological sites are especially cheap. Hoard coins are favored by all but the poorest and youngest collectors.  You have to think in long term investments for this sort of thing, but even then be aware that fashions can change: A painting by Sir Edwin Landseer fetched far more in the nineteenth century than it would today (inflation adjusted). Never buy anything when it is a fad.

Tomorrow, the foolishness of making the researcher pay.

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