Art as an investment - not so much

We read about paintings by the most renowned artists selling for multi-millions of dollars and we think, "Boy, that was a great investment!"

Now, Art + Auction Magazine has done an entire issue on art as an investment. The upshot of the articles is pretty much that monetary appreciation of art, especially the art that makes headlines at art auctions, about equals what would have be earned over the same time period with a reasonable money market or CD.

The market investments, however, would be far less risky and not require insurance, security and maintenance expenses.

Summary? Don't buy art solely as an investment, unless you consider ownership and the ability to enjoy the art on a day-in, day-out basis is sufficient reward to cover the possibility of a monetary loss.

Yes, "loss." A surprising amount of art is sold in the secondary market for less than the previous owner paid for it. The reason is simple. In auctions, the winner is the one willing to pay the highest price. Others who are interested in the art drop out when the cost exceeds their perception of value. By definition, the auction establishes the highest price any work of art is worth.

"Ah," you may say, "what if another buyer exists but he or she was not at the auction? Given a new opportunity to buy the art at the new owner's price minimum, that person may pay the higher price."

What would you estimate are the odds that someone interested in a style or genre of art would miss an auction, or news about its results, in this age of instant Internet connections? I would guess somewhere around one-in-a-million. Pretty long odds.

Of course, there also is the chance that age may add to an object's value. Perhaps, but the owner should be ready to live with the cost of ownership, including the opportunity to earn interest on the amount paid for the object.

Okay, why am I writing in a way that could easily undercut my ability to sell you or someone else a work of tribal art?

Simply because, as I have written here before, the only real rationale for purchasing a piece of art, including tribal art, is the pleasure that owning it will give you. Does it have an interesting story behind it? Is it beautiful or otherwise mesmerizing? Do you enjoy looking at it. Does it make you feel good? Smart? Special? Does it add to your appreciation of life and culture? Does it make you think?

A "yes" answer to any of these questions is reason enough to purchase art, add it to your collection, set it on your shelf or hang it on your wall. When you are ready to sell it, at what ever price, you will have received maximum value for your "investment".

Update: Another news item has turned up that adds another dimension to the idea of art as an investment. It relates to authenticity. Many objects of tribal and native art are not what they are purported to be.

A Cairns , Australia Aboriginal art gallery is being investigated for selling the work of two non-aboriginal artists as having been created by Aborigines.

Another work identified as a Rover Thomas painting was withdrawn from auction when information listed about it was questioned as incomplete.

The Australian government is looking at ways to regulate art sales so that there is no "deception" or "misrepresentation", as is often claimed by competitor galleries or auction houses,

Tribal authenticity is hotly argued by competing dealers in African tribal art.

Alleged Native American art can turn out to be something created in another country and imported to the US or Canada, without correct attribution.

All of this underscores that any art purchase, tribal or otherwise, ought to reflect your unvarnished love for the item. That way, if you purchase something that ends up without the value you were told it has an authentic piece, you will at least have enjoyed it for the item itself while you owned it.

Also, it reinforces the importance of doing business directly with the artist or with an intermediate who will guarantee that what you are buying is what it is said to be

Such precautions assure you that you're buying the real thing or your money will be returned.

Here comes the commercial:

If you purchase any art object from any Aboriginals:Art of the First Person website, such as ZuniLink, Native-JewelryLink, Native-PotteryLink and TribalWorks and you determine after the purchase that it is not what we represented it to be, we will buy it back for the price you paid for it, assuming it is in the same condition as when you purchased it.

That is our promise and our guarantee.