Theory #500,000: For $500,000 I Could Have Done That

Visual Codec - August 1, 2006

A popular phrase among contemporary art skeptics is "I could have done that," and it applies especially in regard to art that seems easy to rip off, such as that of Jackson Pollock or Andy Warhol.

And though they are right, though they could splatter a bunch of paint against a canvas and mash cigarette butts into it, they didn't think to do it in the first place and, therefore, the product that they would construct as a sequel to Pollock's splattering wouldn't have the same degree of value because, in art, the visual product is not the only thing that matters.

With art in this epic age of mechanical reproduction, it's the idea that's most remarkable and valued; it's the concept that matters most.

Lately, however, even I've been left wondering — exactly what are the implications of this kind of structure?

Why, for instance, did Ronald S. Lauder, the cosmetics mogul, recently pay $135 million for a Gustav Klimt portrait, a price higher than any painting has ever been sold for at auction, when the poster of the same image costs only $30?

Sure the image looks that much better in real life, when all the colors pop from the physicality of the paint, but what exactly is Lauder paying for?

And why are people willing to pay approximately $500,000 for one of Damien Hirst's butterfly paintings? A friend — who incidentally is not an art skeptic but an artist — recently pointed out that the ingredients required to construct an exact replica of Hirst's painting would cost no more than $240.95 were you to order all the supplies online. So then, why pay $500,000 for it?

Having posed these questions, which are, at their core, closely related to the skeptical "I could have done that" comment, I also willingly admit that these questions are hardly new.

But living in a city where the art is, to put it mildly, cheap by Hirst standards, it's hard not to wonder the following horde of questions: What compels people to pay $500,000 for a painting? What makes a painting really worth $500,000? What will it take for Seattle's art market to reach these sorts of sums (and do we want them to)? After all, is there any value in having $500,000 art selling in Seattle?

With such disparate opinions about whether art is a good investment, economists don't really help to shed any light on these matters. While a study recently performed by Merrill Lynch & Co. reports that, "Art is one of the worst ways for investors to try to make money," Art Market Research just wrote, "Modern art prices have more than doubled since 1998, and some contemporary price indexes have trebled in 10 years."

So art's not a sure thing. It might or might not increase in value. We get that. And yet, here we are, with Lauder paying $135 million for a painting that someone, once, bought for a couple hundred. Does Lauder think the value of his Klimt will increase ever further? Or does he just love the image enough to pay so much money?

The questions, as I see them, aren't outright answerable. I fall in love with images, not investments, but I do find the investment/value aspect of art both extraordinary and relatively incomprehensible.

And yet, I'll be the first to admit that recently I've found myself in a distorted bargain-hunter trap (albeit on a much smaller scale than Lauder's), wanting to buy things now because I imagine that one day they will have greater value — not just monetarily but also in the history books.

Walking through Seattle galleries these days, especially with such top tier products as SuttonBeresCuller's Three Dragons on the scene, I often think to myself, "If only I could invest now."

Hence, theory #500,000 (or $500,000, whichever sits better for you): Art in Seattle is cheap, but it won't be forever, so start investing already. In 1993 some of Hirst's work went for £55,000, or approximately $101,920. It's now fetching four times as much, and that sounds like an incredibly good bet to me.

Before you know it a SuttonBeresCullers will also cost upwards of $500,000, and when you go to sell it at auction in 13 years, you will be laughing your way to owning a Klimt too. That is, if you can stand to part with it.