ART

A word with a huge deal of occupations in the modern world, and your perceptions as to what it relates to will vary along with your feelings towards it. People choose to admire art, some study it vigorously, and some display and showcase and just deny art being in their lives. With the centuries of evolution of human beings, art in history has been playing a prominent part in molding the modern world, as it was seen closely with innovation, knowledge, and awareness, helping in the progression of civilizations and modern societies. 

What purpose does art serve? 

Starting from the edge of humanity, the paleolithic age of man, in the last subdivision of the stone age, when it was the time where survival was the primary intent, art served this very purpose. Cave drawings being primitive communication had very little form, style, or genre to them yet they perfectly illustrate the artistry of the era.  

The art in the neolithic era was used to honor ancestors and as a part of the ritual practices in the form of statues, totems, masks, and effigies.  In both eras, despite the argument that these illustrations or designs were used in the primal survival mechanism, they cannot be classified as art. However, these sightings and excavations laid the foundation for art as a whole. 

Standing warrior, Period: Early Bronze Age, Date: ca. late 3rd millennium B.C.Geography: Syria-Levant, Medium: Copper, (Photo: The Met Museum,  via Image open access, Public Domain Collection)

In the Bronze age, we can understand that with the dawn of civilizations, people created their first works to honor and reinforce beliefs greater than themselves; by crafting statues, pots, or masks that are durable. The growth of literacy and verbal communication took huge turns within certain civilizations. With hieroglyphics, keeping records and communication in Ancient Egypt, formed the core symbols with allotted meaning, which is a natural evolution or upgrade of cave art. Distinguished carving style can also be seen in the ancient Mayans of South America, which lead to the development of calendars depicting time and seasons. 

There are other forms of arts, expanded and seen versatility from Age of Idealism in Europe; with the rise of Greek and Roman cultures, emphasizing psychological thought. Time passed and with the rise and fall of civilizations, the middle ages which is dominated by Christianity.  The Renaissance was an era heavily focused on contextualizing and depicting religion along with eccentric art accompanying manuscripts.  From the East, beautified religious arts of Hinduism and Buddhism in India, China, Tibet, Cambodia, and Japan, in the form of Statues and Architectural wonders, deceiving harmonious teachings of life. Art in the form of Calligraphy redefined the style of geometric art, and the elaborated mosaics were led by the Arabian artists, that emerged in Islamic Peninsula. 

 Mihrab; Date AH 755/AD1354–1355 J.-C, Geographical area: Iran, Isfahan, Technique: Mosaic tiles with polychrome glaze on a body of siliceous paste in a mortar. (Photo: The Met Museum,  via Image open access, Public Domain Collection)

So did art serve its purpose? The answer is yes. Throughout its evolution, art has been a powerful tool that pushed agendas, promoted ideas, and changed perceptions. Art has been carrying memory, storing historical excellence, and bared the role of a bridge for countless cultures and people.  Hence, making itself one of the rarest formations on the planet, leading to the costliest affair one can afford. 

Origins of the Art Market 

The art market hasn't begun until humanity started to treat it as a luxurious object and made it limited. Creators have demanded the valuations of their work and the product of the art, just like any other survivals to fit in the hierarchy of society. Dated back to the Renaissance, did change in the 17th Century. For the first time in history, humans began to free themselves from religious influence. Until then the most common practices were exhibitions of the collections, which are generally in the hands of nobles or a few wealthy merchants. 

The development in the scene of art collections began in central Europe during the period, indeed with the economic and social rise of the central European bourgeoisie. This growth is seen in the hands of gigantic commercial activities that lead to the empowerment of the bourgeoise attaining powerful strata in the high-class societies, such as bankers, lawyers, and high net worth officials. So this new strategical era needed to manifest a new position and they all found a perfect fit for their needs, which is art. Hiring acclaimed artists to decorate homes, was seen as a symbol of power and wealth. When the practice of exhibiting the collections has begun the phenomenon enriched the painters. The creation of themes advanced to the taste of the collector. The interests of the bourgeoisie sought to exalt themselves through works of art. Thus, the rise of a new dynamic in the exchange of artistic works appeared to be the true beginning of the art market, which is evolved till today. It acted not only as a sign of power and wealth but they are part of their heritage and form of investment. The competitiveness among clients rose in the demand and supply where the market is generated and auctions took place. With this momentum, the expertise of art dealers inclined, and many of them have become part of this new trade too.

“The development of the art market per se depends crucially upon three factors: the emergence of collectors, the production of movable works of art, and the development of mechanisms for selling these works of art, either directly by the artists—through fairs, markets, and exhibitions in their shops and studios—or via intermediaries such as dealers and auctioneers.” - Read more.

This circumstance caused a phenomenon of forgeries, heists, and destruction, sold on the black market on the other dimension as well. 

A Billion-dollar Market

The current art market once again proved its glorious resilience in 2021. The global art market reached an estimation of $65.1 Billion, with aggregate sales of art and its excellence by auction houses and dealers.

(Photo: Art market worldwide - statistics & facts, Published by Statista Research Department, Apr 5, 2022)

With its biggest downturn in a decade, in 2020 the worldwide art market recovered with an increase of 29% surpassing the pre-pandemic value in 2019. During the covid-19 period, the situation has created many uncertainties with restrictions on operations, travel, and events. This series of unfortunate time periods contributed to a contraction in sales of 22% in 2020 to $50 Billion. During this crisis, this market has slowly shifted online where dealers and auction houses strategized significantly in maintaining sales and managed successfully in reducing the damage it caused. 

Graph: The Art Market 2022; An Art Basel & UBS Report

In the year 2021, all segments in the art market grew but the auction sector showed an inclination year on year improvement, with the public auction sales, it rose by 47%. In its leading position, the US market shifted to 43% followed by China and the UK by 20% and 17% respectively on the global scale. The digital market never was better in expanding in 2021, with a growth of 7%, reaching $13.3 billion. Online sales helped for 20% of sales in the art market. On the other side of its expansion, the NFTs saw substantial growth in 2021 with the rise of several NFT blockchain platforms from $4.6million in 2019 to $11 billion in 2021.

Once you have got your wallet opened and funded, there is no shortage of NFT websites to purchase the digital arts in the ocean of tokens. The current largest marketplaces are Opensea.io, which is a peer-to-peer platform that bill itself as a purveyor of “rare digital items and collectibles.”Another such is Rarible and Foundation. Although these platforms host thousands of NFT artists and collectors, it is always suggested to do your research before buying. The verification process for creators isn't consistent across platforms. So make sure you don't fall victim to impersonators who have listed and sold others’ work without their permission. 

How can you make wise decisions in Art Investments?

The common inhibition about purchasing a piece of art as an asset is that it mainly involves high society members. Various ways of investing in art can be profitable. Just like it needs practice to reach artistic excellence, investing in art generally needs patience and remaining stable to benefit significantly from its prosperous period.

Deep research is a must before you make a move with your choice.  Like investing in other markets, you might or might not be assured a profit, but with due diligence, you will be able to pick a gem or two if you make good choices.

Benefits: 

If given a period, any excellence can become potentially valuable.  Art investments are not correlated to the stock market, despite its fluctuations, they won’t have any impact on the art world. You can still gain value or hold its current price if the stocks are in a bear market.

Although art is a long-term asset, some timeless pieces can surge in their prices. Therefore, when an artwork is in its popularity, you may be able to grasp a decent profit in a short time.

How to identify if Art Investment is for you or not?

As mentioned, several times, art investment generally needs time to ripe in the market. This is not for someone who wants a make a quick buck or liquidate it immediately or for a short period. According to “The Global Art Market by Citi Art Market report in 2019, Between 1985 and 2018, the art market as a whole produced an annualized return of 5.3%, Impressionists 5.0%, and Post-war and Contemporary Art 7.5%.” So, if you interpret surges in value as cryptocurrency, then art is not for you to invest in. 

As a tangible asset, artworks need the utmost attention and care to maintain their richness. This may be best to avoid it if time won't permit you to do so. Investors buy based on its potential monetary value and their fondness for it and their desire to display it in their homes. As a long-term investment, it is better to buy a piece where you can maintain it properly before you can ever sell it on the market.

Claude Monet (French Impressionist, 1840 - 1926- “Woman with a Parasol - Madame Monet and Her Son”, 1875.(Photo: National Gallery of Art; via Image open access, Public Domain Collection) (see here for more Impressionist Styles)

Finally, if there is no time to learn and gain awareness about art, then probable it should be best to leave it alone. If you cannot comprehend the current market trends, you might see a loss across its market value before you invest your hard-earned money.

Quick tips for a better understanding:

1. Before jumping directly, it is always good to research the artistry behind it. Advisable to not gamble all funds around new emerging artists, but rather have a mix with established artists.

2. Focusing on one category (such as Contemporary art) at a time can help you focus from basic to advanced stages in one particular genre or style instead of random shuffle picking pieces that appeal to you. For example, the more you concentrate (nature, life, mythology, etc), the better you can be a professional in understanding that can lead to the right decisions.

Takashi Murakami 727 Mr.DOB, created in 1996 ( Photo: Publication excerpt from MoMA Highlights: 375 Works from The Museum of Modern Art, New York)