The Picasso Art market – Spears WMS 25 March/April

Apr 3rd, 2012 | By | Category: Articles
Why Picasso is Attractive for First-Time Art Buyers…And Auctioneers

Blue-Chip Period
What a performer! Ivan Lindsay on the reasons why that randy old goat Pablo Picasso remains so irresistibly attractive to neophyte art collectors (not to mention auctioneers)

article led with the line: ‘Pablo Picasso has been dethroned.’ The article was referring to Picasso being knocked off the podium of the annual Artprice report, which grades the leading artists by auction revenue. The report draws results from a group of 450,000 artists, and Picasso slid into fourth place with $311.6 million after Warhol ($324.8 million), Qi Bashi ($445.1 million) and Zhang Daqian, who headed the table with $506.7 million.

That two Chinese artists, little known outside China and specialist circles, now lead the table of the world’s highest-selling artists is an astonishing result and an indication of the changing market. While it definitely shows the increase in the size of the Chinese market, the actual figures are misleading because the Chinese art market is manipulated and appears to have no regulation whatsoever. Western sources glibly repeat dramatic statistics supplied by Chinese auction rooms, whereas the few Westerners who have tried to participate in these auctions report back that the corruption and dodgy practices that exist there are baffling even to those who think they have seen it all in the Western art market. The dazzling run of these Chinese artists, allied with market manipulation, implies that this is a market in which to be very cautious and take profits if speculation is your motive.

But is the strong demand for Picasso’s work, which has existed from his early career to the present day, starting to cool? It appears not, as Picasso is still considered the outstanding artistic genius of the 20th century and the demand for his work shows no sign of abating. Apart from 2007, when Warhol pushed him into second place, Picasso had held the number one position on the Artprice survey every year it had been published.

Why is the Picasso market so dominant? Most art is bought by new money. Old money generally already has its art and later generations are often so controlled by trustees that they cannot do much except live comfortably. The desire for new money to participate in the art market is not a new phenomenon and arises out of basic human instincts. Those who have become successful are curious as to what all the fuss is about in the art market. It appears to be a rich man’s game with its own rules, and it’s a club they can now join. Participation is exciting, a little nerve-wracking and a good way to show off one’s new riches. So where to begin?

Picasso is often the starting point. His oeuvre satisfies today’s collectors on every level: it’s abundant, clearly documented, widely exhibited, extensively covered by literature and well represented in the leading museums. Rarity is not attractive to today’s new collectors, who have little cultural knowledge. They seek familiarity, abundance and track record — hence the bizarre success of Damien Hirst’s Spot paintings, currently filling all Gagosian’s galleries, which were mass-produced by an army of assistants. Apparently Hirst continues to recommend those done by ‘Rachel’. At least Picasso made his own art.

Picasso has an enormous oeuvre with a variety of different periods and styles from which to choose, from the Blue period, the Rose period and Cubism through to the late cartoon style. The size of his production is hard to gauge accurately but is extensive. There are around 13,500 paintings, at least that number of drawings, 2,500 original prints, 1,000 ceramics and 700 sculptures in other mediums. With the prints and ceramics generally in editions of 75, that gives an oeuvre of over 250,000 artworks.

Table courtesy of ARTvest partners
Within this vast body, fashion meanders around the various different periods. Until recently, the early work was sought after and the later cartoonish style considered a joke. It was thought that by his last decade Picasso rather despised his clientele and delighted in dashing off paintings with little effort and charging high prices for them. There is also a sense in the late works that he was increasingly conscious of his own mortality and desperate to seem au courant to his young girlfriends. As the early Blue and Rose periods have become expensive, and Cubism is too intellectual for today’s taste, the later works compare favourably to the childlike scribbles of such later artists as Basquiat and are now increasingly sought after.

The diamond dealer Laurence Graff was featured recently in the magazine Gstaad Life explaining why he has decided (not surprisingly) to open a shop in Gstaad. In the article he is photographed in front of a late Picasso, presumably from his own collection. Of all the paintings he could have sat in front of, that he decided on this late cartoonish Picasso shows the current vogue for these pictures. In it, two figures face each other. The figure on the left, presumably a woman because she has three breasts, with one eye on her nose and another sliding down her face, sits listening to what might be a man with insect-like arms playing a flute.
DESPITE NUMEROUS FAKES on the market, it is actually quite easy to establish if a painting is a real Picasso because most of his works are published in various books, such as The Picasso Project, or have a certificate from one of the family members, such as Marina, Maya or Claude Picasso, who, with their extensive holdings of his work, carefully control the market. The Picasso Project updated both the books of Christian Zervos and the catalogues compiled by the Musée Picasso. Zervos published 22 volumes of illustrated Picasso works between 1938 and his death in 1970, and a further eleven have been added since. If a painting is illustrated in one of these sources then it is highly likely to be real, which soundly underpins the market and gives confidence to buyers.

In addition to the strict authenticity control, there is an extensive and well-documented track record of appreciating value. Inch for inch, Picasso’s work has appreciated more consistently than that of any other artist. A study by ARTvest partners of New York in September 2010 took five notable Picassos and calculated their compound annual growth rate as ranging between 15.88 and 30.23 per cent.

Although reliable figures only exist for these exceptional and valuable paintings, more modest works by Picasso also appreciate strongly. His best works, as with any artist, appreciate the fastest, but as is normal with such a prolific artist who never destroyed anything, the quality ranges considerably. There are numerous Picasso exhibitions held in museums every year and most major museums have plenty of works by the artist in their permanent collection. There are also at least four museums devoted to his work, including those at Barcelona, Paris, Malaga and Antibes.

So it can be seen that when buying Picasso collectors have reassurance, track record, appreciating values, and numerous books, exhibitions and museums to refer to. It is, however, wise to seek help in selecting his best work. Several dealers dominated the Picasso market for years but, with the recent deaths of Jan Krugier in Geneva and Ernst Beyeler in Basel, there is a sense that the market is opening up. In New York, Pace Gallery and Gagosian are active and in London there is James Roundell and the Nahmad family.

Recently, amid the economic doom and gloom, the art market has appeared a beacon of success defying the carnage all around. However, it is traditionally the last market to subside and then the last to recover in the economic cycle. This magazine warned readers to be careful when the Sotheby’s share price turned down some six months ago, a traditional indicator of trouble ahead. The art market will not continue to defy gravity for ever, but for those brave enough to keep buying, and particularly for those who are exploring art acquisitions for the first time, the simplest strategy would appear to be… ‘Buy Picasso.’

Ivan Lindsay is a contributing editor at Spear’s.

Tags: art investment, art market, Ivan Lindsay, Picasso art market, Picasso prices

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