art break

The Color of Money

jeff coons
Will it burst or will the art market keep on growing? Jeff Koons.
  • Why it matters

    Why it matters

    As investors have fewer ways to place their money profitably, they increasingly turning to the risky world of art.

  • Facts

    Facts

    • Christie’s recently presided over a record art auction, which generated $853 million.
    • German art lovers were outraged on Thursday when two works by Andy Warhol were sold by Christie’s for $82 million and $69.6 million; they were originally bought by a casino for $185,000.
    • Artists in high demand among investors include Andy Warhol, Jeff Koons, Gerhard Richter and Jean-Michel Basquiat.
  • Audio

    Audio

  • Pdf

Some say art can save your soul, apparently it can save your body, too.

More and more people are turning to art as an investment as other possibilities fade away. Savings accounts barely provide any interest, Germany’s ten-year government bonds come with a 0.79 percent yield and Japanese government bonds only generate 0.49 percent.

Art is looking increasingly attractive – and it goes beyond the aesthetics. Paintings, sculptures and photography are becoming an alternative currency. In New York, Christie’s auctioned paintings for $853 million on Thursday – a new world record.

“Demand is increasing among our customers for art,” Peter Raskin, director of private banking at Berenberg told Handelsblatt. “They value the emotional connection in this form of investment.”

“There’s also barely any other way to earn money on the capital markets these days,” he said.

Investors hope that by buying valuable artworks, the value will increase significantly. In Germany, a casino sold “Triple Elvis” by Andy Warhol for $82 million and his “Four Marlons” for $69.6 million. Despite outrage in the art world at the loss of these works to the German public, the profits are a significant increase on an initial investment of $185,000 for two pictures at the end of the 1970s.

“The prices are high but I don’t see the market overheating for now,” Mr. Raskin said.

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