The art market likes a good apocalypse story, especially when impending doom comes in the form of a dark bubble on the horizon. Galleries and collectors seem to get a high off the fear that the "art market bubble" will soon explode, making works that cost astronomical prices this year become impossible to sell for a profit in the future. Today, Katya Kazakina wrote an essay for Bloomberg that once again has the art world shaking in their John Lobbs.
Kazakina's article asserts that with the rise of hot, young art stars like Oscar Murillo and Lucien Smith, whose prices have risen 3,000 percent in the last two years, more collectors are snapping up young artists for inflated amounts in hopes of flipping them. This new trend, she writes, "may be a sign that the contemporary art market is taking on characteristics of a financial bubble." (There's that word again!)
Many of these flip-able artists are males under 35. As Kazakina describes it, they are being ushered into the market like bleating lambs to the slaughterhouse. Parker Ito, one newbie in a group of artists making their debut on the auction block this year, including Eddie Peake, David Ostrowski, Israel Lund, and Fredrik Vaerslev, said, “I kind of wish my work wasn’t at auction. I am too young. It’s a sign of how ridiculous the art world is. It’s like market hype.”
Arts journalists agree that nothing good can come of putting the preemies up for sale before they're ready. Curator and writer Kenny Schachter wrote on his Facebook today after reading Kazakina's piece, "5,000% is the new 100% profit. The Mugrabis can always work at Burger King if the sky falls." Other journalists expressed similar scorn at this market trend on Twitter.
It's undeniable that the art market is becoming an untrained beast of unchecked skyrocketing prices, and what goes up must come down. At the same time, with the enthusiasm for "Flipping Babies," at least collectors and galleries are paying attention to people besides the Damien Hirsts and Jeff Koonses of the art world. Still, the gap between big-ticket people like Murillo and emerging or outsider artists without that star caliber is widening, making it even harder for smaller, independent galleries to compete.
As Bill Powers of Half Gallery (who has himself benefited from this trend by peddling Lucien Smith), “The real question is: Can your prices hold in the seventh or eighth season you’ve been at auction?” Answer: probably not, but that's not stopping people from dropping the dough.