Tag Archives: financial crisis

The Value of Art In the Age of Financial Crisis

Yellow, Red, Blue Oil Painting by Rothko

The economic crisis of 2008 changed the way that many markets operate, their pace, size and reach. However one market that has not slowed is the art market. In November, Sotheby’s enjoyed the most successful night in its storied history, selling almost $375 million worth of Abstract Expressionist and Pop Art.[1] Like many markets, the art market is based in word of mouth and on the knowledge and history of previous sales. There is an aura created around an artist and their works based on these prices as well as in relation to supply or, uniqueness of the works of art based around ‘security.’ As Adam Davidson argues, “art isn’t gold, or any other commodity in which units can be evaluated objectively.”[2] Yet, is the way that the art market functions really that different from other markets? What is it about the art market that has allowed it to remain relatively insulated from other markets and experience growth during this downturn?

In order to examine the way the art market functions I want to look at two examples, and in particular to explore how key determining factors (such as uniqueness and ‘security’ of investment) alter the works of art and how they are sold (or not) within the current art market.  I want to firstly focus on the works of Mark Rothko. In 1967, a red Rothko sold to the National Gallery of Berlin for $22,000.[3] Over the last few years, Rothko’s work has sold at auction at extremely high prices. For example in May 2012 Rothko’s Orange, Red, Yellow sold for nearly $87 million.[4] There are many explanations for Rothko’s increasingly high sales. One is the suggestion that Rothko was born in Russia and that is works are being bought by new wealth in Russia.[5] Another notion is that the large size and blocks of bright colors appeal to people as objects to hang in their homes and, as such, his work is easily recognizable. The high prices of Rothko’s works have fuelled even higher prices in later auctions and have been supported by the inclusion of much of his work in permanent museum collections (Tate Modern, National Gallery of Art and the Museum of Modern Art). His works are now deemed ‘safe’ for investment at a moment in time when many investments are not.

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Good Politics v. Collective Responsibility in Times of Financial Crisis

Since the collapse of the global financial system in 2008, the most popular course of action- above job searches and credit defaults, I’d venture- has been finger pointing. In his first State of the Union address last week, President Obama continue the trend by hammering against the banking system. In the January 30th edition of the economist, one author points to an entertaining illustration made on the CNBC show, ‘Mad Money,’ which showed a “Lloyd Blankfein pinata” that when split, gold coins poured out of. The Economist reports that the assault intensified when the President announced his plan to cap the size of these financial institutions as well as “ban their ‘proprietary’ trading… and limit their involvement in hedge funds and private equity.” The aim of such measures is to join with other bills in the works to allow regulators to limit the scope of institutions that threaten financial stability. Coming on the heels of the Democratic defeat in Massachusetts, the move can certainly not be separated from politics but it is likely to have been in the works for far longer than a few days. (more…)

Capitalism's Meltdown and the Body (III)

by kiddingthecity

The financial system is ‘ill’, capitalism is on the verge of ‘collapsing’, a drastic ‘cure’ has to be found quickly, ‘toxic’ funds need to be ‘eradicated’, and so on. Terms from the vocabulary of medicine and biology have been largely used to describe the systemic crisis of the latest capital, often comparing it to the body in pain. Probably, in an attempt to localize and make more understandable the phantasmagoria of the trillions to Mr. and Mrs. Smiths, the taxpayers, the backbone of the economy.1st April

On the other hand, people protesting their dissent at the 20 ‘surgeons’, who gathered in London for the world summit, were confined, squeezed, made literally prisoners in public space by a well established police tactic, in Wednesday’s protest in the City of London. For seven hours, they have been left without basic services, water, food, or a chance to move away, compressed in a tight space by the police, armed in full anti-riot gear. A colleague of mine, a PhD research student, so described to me in a private email the scene: “…most people around us were totally calm and peaceful till the police penned in thousands upon thousands of people without giving reasons for their actions, without access to food or water or toilets. Disgusting!”. A journalist from the Times (Murdoch’s paper) so comments: ” The police wilfully criminalised and alienated 4,000 innocent people. If I were to design a system to provoke and alienate, I could not do better”.

What would have Foucault thought of this, I wonder?

square-eye3An Intro to Biopolitics (K. Schlosser)

square-eye3For a theory of urban warfare tactics (E. Weizman)

Apocalypse in Central London?

Trafalgar Square

by kiddingthecity

Lovely sunny day in London for April 1, Financial Fools Day. Four Horsemen of the Apocalypse are leading, as I type, carnival parades from four cardinal points to the Bank of England, in the City of London. They are Red (War), Green (Climate Chaos), Silver (Money Crimes), and Black (Land-grabbers). On Facebook it has also appeared an invitation to flash-mobbing the City Exchange with tents and sleeping bags for an Eco-camp, but the “secret” was leaked by this BBC news article a couple of days ago. Would the Police have read the article, too? And, if so, how are they going to react? There is a lot of suspense and excitement for the G20 summit, and a lot of money (far too much) has been spent on security and parties for untouchable world leaders: would they allow a day of inversion, legitimate dissent, and genuine fun in the heart of the financial district? Do they celebrate April Fool’s Day?

square-eye30More images of the Apocalypse during last Saturday’s rally (London)