Kind of investment nobody talk about.

So lets say u accumulated reasonable capital over past years, you got your gold and silver diversification, multiple currencies diversification, you own some propherty or maybe even farm land...

 

So now it looks like u have done your homework and are as safe as it get right? WRONG. You forgot one last piece, one almost every clever rich man and woman fight for, one central bank cannot control nor will it be confiscated like precious metals could(although not likely) because it dont represent danger to fiat money, one whose value keep steady even as everything else collapse with correlation to dollar, one thats definitely not overcrowded yet(and not manipulated by central banks) - and finally one you actually dont need to be too rich to get some of it too!

 

What could such final piece of diversification be? Where those richest famous people actually put their money into? To know that, you would have to know some of them and visit their home to understand. Rich people dont talk at their homes dinner with their other rich friends about stocks, gold or bonds much, if at all. THEY TALK ABOUT ART!!! They talk about that Picasso painting they recently purchased in auction house, or sculpture from Giacometti, but what they certainly never speak about at the dinner are some silly stocks, currencies or gold! They are prepared to waste tenths if not hundreds millions for they "darling" art piece, even though they would still sell their mother for 100 bucks.

 

But the thing is, most of us here dont have such money but if u start to understand at least little bit about art, if you understand how to estimate *art as investment value*, there are always new contemporary artists that are worth maybe few hundred bucks or few tousands, but in 5-10 years and often even much less like 2y their price can skyrocket to multiples of 10+. Now, as I just returned from Switzerland and had opportunity to get basics from my very good friend who I believe is one of best specialists on contemporary art and impresionism era, here are some basics I will share with u:

 

Author is of course very important, but for new ones you cant know right away if he become legend, for that you need to look at his carrier, what he did and his *continuation*. Author that spit just few good pieces and then return into background will never become very big.

 

Author age is important. If you know your favorite author is good and have good periods, nothing is better that buy any of his pieces when he is too old(but still alive). Because when such author die, his art literally skyrocket. Great author but with age of 30 may take too long time for you to profit.

 

Author period. Even for many famous authors, not all of their pieces are considered of great value. For example Picasso in his latest periods like `70  is not as strong as say `50.

 

Method of painting. Painting on oil and canvas is generally considered most precious as compared to standard paper+chalk for example, or wood or lithography. There is more on this and it also depend on the author but in general this is important to know as same picture(or its variant) on different material may have price difference of 1-2 extra zeros!!

 

Signed piece by author personal signature will definitely have higher value than unsigned one.

 

Limited number. Art pieces usually exists in multiple numbers of same kind. So picture that have mark say 123/300 mean there are 300 pieces in the world and this current one is 123th. Even better would be say 21/30. Some collections have "unknown" or "unspecified" number, which of course make big impact on price. Sometimes each piece may have specific personal touches from the author to make them more unique.

 

Year. How old is art is important but much much less than some think. Also not all are investment-grade. You could have painting on oil and canvas, beautifull and big picture, it could cost say 10k or 100k, but when u sell it in 10 years, you still sell it at same price. There could be many reasons for that. Especially pictures that are decoration and not really art. Picture from 16 century may have lower value than one from 19 century for many reasons like mentioned above.

 

There are many other things and frankly, even I know nothing yet, but for those that may get interested in this investment I hope at least these basics help. With help of my friend for example, I just bought 2 pics from same author when I was in Switzerland first half of this month. One for 390chf and other for 550chf. He also bought for his nephews, all pieces were sold. Author is now still alive but ~80y old. According to my friends estimation these pics should with certainty cost in say 5 years tenths of thousands and more as time will pass.

 

This thing need another education and learning, there are pitfalls like everywhere else. But if u really want diversification independednt from THIEVES, its a great section to put your time into. I merely wanted for u to spark interest in it, here is some inspiration I took with my phone when I was there visiting friends(guess how much first pic. cost)::

 

 

 

 

Views: 156

Comment by Romano on December 21, 2012 at 7:04pm

Btw, guess what is on 100chf bills? Giacometti skulptures ;)

http://www.seniorweb.ch/it/type/media-image/2010-12-29-banconota-da...

Comment by Romano on December 21, 2012 at 7:56pm

One more before I finish today, since there are many people from India here, I wonder if some of u recognize this:

Comment by Romano on December 25, 2012 at 12:55pm

Some more stuff, imagine having your savings in these things. And then thiefs break to your apartment, take every TV, video, computer, even clothes... and leave these paintings on the wals... (happened many times before btw ;))) )

Comment by Romano on January 6, 2013 at 2:08pm

Hello pixta, nice to meet someone who see into this stuff a bit. Art in moment is actually experiencing boom but its still not a bubble. You see, it depend what u get and also how u estimate. This market in general however cannot really experience big problems because there is only so much of the FINE art that matter. Rule one is that no matter what crisis, there will always be a lot of rich people and they want this. You cant just count all stuff that exists, its what matter. As we speak, this market is only booming now, not slowing. 

If u read my text you could see that not only u can preserve capital, u can actually make lot of money if u buy right stuff. I have seen it in my own eyes, certain paintings or objects that costed say 500-2000$ 2-5 years ago now are in tenths of thousand value. This is because certain factors and authors that became "discovered". Many today popular ones were even rejected in the past, galleries didnt want them only to reach few years later incredible value. I know people that live from this, they buy today something and sell in 3 years for x10 - business as usual...

But, as I said u need to understand this and know what to get. I by no means consider myself experienced in this, only wanted to teach few basics. You can have 18 century beautiful painting and you sell it at the same price u bought - or lower in 10 years. I mentioned this. Anyway, from what I saw I can assure you that this business even though maybe in general may look like just correlated to $, many individual pieces under shell are waiting to explode in value. And dont forget as other countries becoming rich - like china etc., demand will still increase. If u understand this stuff well, I could even go as far as to say that it could be better diversification than into gold in many cases.

Btw that link is great, thanks!

Best regards. 

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