The Russians are buying art but Hirst is a seller
If bidders pay £111m for Damien Hirst’s latest works is the art market immune from the decline in other forms of asset values?
World share prices are tumbling, banks collapsing and property - residential and commercial – is sliding. When people look for alternative investments that retain their value they often choose gold, but it is 25 per cent down on this year’s $1,000 an ounce peak too. Commodities, including oil – if you regard them as investments - are down too.
So why should art be different? It is an incomeless asset (indeed, security costs give it a negative cashflow) in an illiquid and niche market that depends on a small group of people whose wealth stems from those other fickle forms of investment such as shares, property or oil.
Yet this year we have seen Lucien Freud’s painting of a benefits supervisor sell for £17m and Francis Bacon’s “1976” triptych go for £43m. Art seems to be defying gravity.
Now Hirst has auctioned 223 of his own works at Sotheby’s for £111m – exceeding even the optimistic expectations. Buyers seemed oblivious to the simultaneous collapse of Lehman Brothers, the pounding of HBoS and the meltdown of global stockmarkets.
To sell so many works in one go would normally flood the market – and confirms that Hirst is not so much prolific but merely a manager of the people who produce “his” works, whether “Spots” or sharks marinated in formaldehyde.
But however good an artist Hirst is he is an even better businessman, having accumulated a wealth estimated at over £150m before the latest auction. Just don’t expect him to invest it is art.
He has been around long enough to see art markets crash. For whatever reason (maybe art buyers don’t read the papers?) the crash usually lags the fall of shares and property by more than a year, but reality does eventually catch up with the surrealists, modernists and all the other schools.
Hirst may realise the game will soon be up and be desperately dumping stock while there are still Russian billionaires who haven’t noticed that their own stockmarket has collapsed. At the end of the day, art is just another asset class.
