From my viewpoint, recent values or prices of art works and antiques,and also their supply system, are extremely abnormal. Furthermore, it seems that the economic turmoil since last year have been further confusing the situation. At some auctions including in New York, some works are sold at surprisingly high prices, and I am often asked by customers and acquaintances whether those works have values equal to the prices. It is certain that some sold prices (successful bid prices) are far beyond normal prices, but, in the first place, I want to make clear that such a question itself is a misunderstanding.
Sold prices at open auctions, where anyone can participate and those who offer the highest prices can buy, do not always reflect original prices and values of art works. If several collectors are eager to obtain some item at an auction, they compete to obtain it and as a result its sold price may be higher than its original value. The opposite case could also occur. Even though some work of art is highly praised and valuable, if no one is interested in it at an auction, it is not sold there. This does not mean, however, the work of art does not have a value.
In this way, sold prices at auctions are dependent on relative values, and some works of art are not appreciated and not even priced if no one understands their value, even though they are beautiful or precious. Conversely, some works are sold at stunningly high prices because of the creator's popularity or intention of speculation, even though they have little value as art. The momentary sold price at an auction is totally different from true evaluation of art works.
Of course, an auction's host expects bids and places the initial estimated prices in the catalog. However, such estimated prices are only expectations based on past performances, and never guarantee the value and price of goods. The responsibility of an auction host is only to manage the auction, and it is the successful bidders who are responsible for sold prices. Many people do not know this fact and this has for years been leading to confusion of values and prices of art works.
The following story is my fiction: I have two friends. Mr. A is an artist of contemporary art and professor of an art collage. Mr. B is an executive of an auction house. I commissioned Mr. A to make a work for 1 million dollars. At the same time, I requested Mr. B to auction the work by A and told him that I would buy it by myself for 10 million dollars, requesting him to discount the usual 20 percent fee to 10 percent. Actually, when I win the bid at 10 million dollars, 9 million dollars will come back to me after paying 1 million dollars (10 percent fee) to the auction house. The total cost to get the work is 2 million dollars, including 1 million to Mr. B's auction house and 1 million to Mr. A.
As a result, Mr. A's work has a record that it was sold for 10 million dollars at Mr. B's auction. Moreover, while I ask other friends, Mr. C who works at a publisher and Mr. D who is a critic, to promote Mr. A's work as one which has a 10 million value, I repeat this type of auction and bidding three times. When I auction Mr. A's work for the fourth time, if other collectors or investment funds buy it for 10 million dollars in accordance with information from the media and the past bidding results, I would gain 3 million dollars, subtracting a total of 7 million dollars in costs for the four auctions. This story is a fiction but it is possible to fabricate a value in this way.
I have written in articles of the fifth chapter of this series, "Power of Beauty," that values of beauty are different from evaluations and prices in the market. This is not only limited to art works. In general, evaluations and prices of goods are decided by market principles including supply and demand. However, such values are not always equal to true values. You must judge the true values by yourself. We are living in an information society, which has been established in the decades after WWII and has imprinted various values in our minds through information. For example, we naturally remember the name of a household detergent because its TV commercial is repeatedly aired. If an item is famous, or if critics and academic experts have highly praised it, we tend to assume it is valuable. In addition, we have come to judge values and prices of goods and things only through vague standards such as majority opinion or "collective consciousness."
After the collapse of the Berlin Wall, various types of information have been disclosed, and we have begun to understand that some aspects of ideology and even religion are a kind of economic activity and that the money economy is a system to amass wealth by some limited persons or limited groups. As a result, conventional values are collapsing. Under the unprecedented chaos of the global economy, many people are starting to seek the real substance of things, instead of pseudo truths or values. Away from the system of money worship, they are pursuing an authentic way of life as human beings. I ask myself why only human beings appreciate beauty, and what is the meaning of owning art? It is high time for us to reexamine such questions, and putting aside contemporary values foisted upon us by mass media, to rediscover authentic values in the world of art.
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