Thursday, January 12, 2017

Art as Investment?

Many people are interested in investing in art instead of the stock market. When someone wants to build an art collection as investment, it is important to stress the risks involved. Since the 1800s art dealers have been advising clients to buy the art they love. This is the single, most important element of collecting. If a piece loses its market value after purchase, the buyer still has a personal attachment to it. Buying what you love is the safest way to invest in art.

Building an art collection from a pure investment position creates an entirely different set of issues. Some economists suggest art investment can be more lucrative than the stock market, but the mercurial trends of the art market can make art a riskier asset than stocks.

In 1637 a Dutch event called tulip mania took place, where prices for rare flower bulbs of the recently discovered tulip reached extraordinary heights and then suddenly collapsed. In the spring of 1637, a single tulip bulb sold for approximately ten times the annual income of a working craftsman. It is generally considered the first recorded economic bubble.

The tulip was unique from other flowers known to Europe in the period, with a saturated petal color unknown to mostly flower collectors. The nonpareil tulip became a status symbol and coincided directly with the rise of new trade fortunes of Holland's elite.

By 1636 the tulip bulb became the fourth leading export product of the Netherlands, after gin, herrings and cheese. The price of tulips skyrocketed because of speculation in tulip futures among people who never saw the bulbs. Many men made and lost fortunes overnight. The collapse began in the town of Haarlem when buyers suddenly did not show up for the routine bulb auction.

In the art market, especially with contemporary art, hedge fund managers like Steven A. Cohen have stimulated a heightened interest in art as investment. As a collector, his interest in specific artists has built a confidence in the art market at large.¹ Some suggest that his interest in certain artists has validated the value of comparable artists and even for art for the art market itself. The high prices he has paid for his collection appears to have mostly turned into a profit. Purchases of recognizable works by famous artists for high prices is more of a traditional collector's tactic, but gambling on the long-term profit from a lesser known contemporary artist may provide larger gains.

Economists like William Goetzmann, David Kusin, and Michael Moses have conducted studies evaluating the monetary gain for a collector using art as a primary investment. They attempt to compare the gain from stocks versus that of art by analyzing artworks which sell multiple times at auction. Goetzmann says that indeed the rate of return for art exceeds the rate of inflation.² But the cost of selling art works is very high, which decreases profit. Also, the likelihood of a willing buyer willing is unpredictable, even with reliable auction records. Unlike stocks, art is not a liquid asset. 

Value is not determined by a large group of people, but instead by individual or group's changing taste. The selling price of a piece at auction is determined by the mood of one or two, single bidder, rather than multiple shareholders.

In her article "Art as an Investment," Wendy Cromwell discusses the difference between art investment funds and traditional collectors. She says, "Individual collectors are driven by passion, . . . informed about auction history, and they consider provenance and condition as important variables in determining what to pay for a work of art, whether privately or at auction." Collectors are typically educated about the artists whom they collect and which pieces are expected to hold value. They compile multiple factors into their buying approach.

Many art investment funds try to diversify their collection in a similar format as a stock portfolio. This model has worked for funds like the British Rail Pension Fund who make a 12% profit by controlling the slow sell off work from a variety of art styles.³ Other investment groups such as the Fine Art Fund are following the same model.

Investment funds often try to collect iconic works by famous artists, rather than pieces they love, to insure their financial gain. This is another risky move. As Cromwell suggests, the provenance of a thoughtful collector's vision often adds value to its marketability. A random selection of paintings that is sitting in a vault might be viewed negatively, as commodities, rather than unique pieces of art.

For a collector, Moses suggests buying lower-priced art, with room for growth. Contemporary art can be risky. When asked what he would invest in, Kusin would buy modernist drawings and sculpture maquettes in order to build a strong collection with a focus There was a decline in value in the 1990s, Goetzmann says pre-war and post-war art but it remains a good investment because the works are "high beta." The means the art genre swings consistently both upward and downward in value.  It is risky but has a strong profit potential.

Collectors are now using art as collateral loans from companies like Art Capital Group Inc. or Citigourp Private Bank, which is an interesting concept. But, this often means a collector would be putting a treasured piece of art into a warehouse for ten years rather than enjoying its beauty. This is considered a preposterous idea by many in the museum and art historical fields. 

Although one can research auction records through a database like the Mei/Moses Index, the auction market is difficult to gauge. Moses says, "The S&P 500 and the Dow 30 are broad measures of how those markets are doing. We need the same thing for art." But galleries do not report such data, making art investment much less trackable than the stock market. Also, in an auction, a piece that sold for a record-breaking price might not actually be worth that price. 

Value can be constructed by a set of collectors who falsely bid up the price in order to insure their own interests in the artist. The results can also be based on the mood of the bidders rather than concrete, reliable data. Thus, a collector cannot insure that their piece of art will sell for its predicted price.

In Finken's article, Goetzmann also sees a discrepancy between the stock market and the art market in terms of a public marketplace. Unlike the visible, transparent public realm of the stock exchange, art buying is conducted in private. The choice of pieces is often minimal and collectors must rely on dealers and specialists for access to. This narrows the market and controls supply and demand.=

These economists suggest that art investment can be lucrative but perhaps riskier than stocks. Art collecting has to be done in a strategic manner, as consistent data in the art market does not always exist. 

If advising a collector who wants to build an art collection, it seems best that art exist only as a portion of one's investment rather than the main investment. Art held for a long period of time seems to accrue the highest value, assuming the artwork is kept in proper condition. The traditional model of collecting art one loves still seems to function best. If it rises in value, that is only icing on the cake.

¹ Landon Thomas Jr. and Carol Vogel. "A New Prince of Wall Street Uses His Riches to Buy Up Art." The New York Times, March 3, 2005
² Jori Finkel. "Painting by Numbers." Art and Auction, April 2004. Pp. 77 - 83
³ Wendy Cromwell. "Art as an Investment." Art on Paper, March/April 2005

Thursday, October 13, 2016

Painting with Light: Belle Goldschlager Baranceanu

I recently discovered the artist Belle Goldschlager Baranceanu. Raised by her grandparents on a farm in North Dakota, the young artist attended the Minneapolis School of Art in Minneapolis. She studied under the artist Anthony Angarola, who would become her fiançe. Before the couple Were able to marry, Angarola died in 1929. In 1932 changed her name from her father's surname Goldschlager to her mother's maiden name, Baranceanu.

In 1924 Baranceanu relocated to Chicago, where she studied at the Art Institute of Chicago and began to develop a distinctive abstract realist style. She soon made her way West, where she was transfixed by the light of California. She settled in San Diego, where she did murals for the Public Works of Art Project at the La Jolla Post Office and Roosevelt Jr. High School. Her palette was imbued with bright colors and modernist broken planes of color reminiscent of the Fauvists.

Most interesting was her ability to paint portraits in a distinctive technique. Beautifully meticulous, yet with a modern sensibility, her figures represented mid-century California.

Belle Goldschlager Baranceanu's paintings range from $2,000-$5,000 at auction. Like many women artists she is undervalued in the art market, compared to male artist of the same caliber.


Wednesday, July 13, 2016

Erle Loran: Bringing Cezanne to California

"Farmhouses" oil on canvas c.1930s (courtesy:

With so much scholarship about East Coast American artists I'm always seeking the California and Western artists who changed the course of American art. Erle Loran (1905-1999) was a most interesting artist of the modern period. Loran published the book Cézanne's Composition, exploring the artist's approach to form and space during a period when Post-Impressionist art still perplexed the American public. The important publication explained Cézanne from a purely aesthetic point of view. Loran's book became a staple amongst California artists, teachers, and students. It was used by important universities who were beginning to teach modern art.

Loran was born with the name Erleloran Johnson. And as a young man attended University ofMinnesota from 1922-1923, transferring to the the Minneapolis School of Art where he graduated in 1926. Through the Chaloner Foundation, Loran earned a scholarship to study in Europe. He became fascinated by the artist Paul Cézanne. Erle Loran explored the French countryside around Aix-en-Provence, France, to document the scenes Cézanne used in his paintings. Loran even was said to have lived in Cézanne's studio there.

Loran returned to the United States in 1930, where he briefly worked in New York publishing art criticism and painting. He returned to Minneapolis where he became an artist of the Public Works of Art Project, a federal program that commissioned artists during the Great Depression. In the mid-1930s, Johnson changed his name to Erle Loran. In 1936, he was appointed to the faculty at the University of California, Berkeley. Loran became the leader of an artist group known as the "Berkeley School." He was influenced by Asian, pre-Columbian, American Indian and African tribal art.

In 1943 Loran wrote his important book on Cezanne. His pupils at Berkeley included Richard Diebenkorn and Sam Francis. In 1954 Loran studied with Hans Hofmann, the painter and theoretician of modern art in New York.

Loran retired from the University in 1972. He suffered a stroke in Berkeley and died at age 93. His art work was collected by the Smithsonian Institution, Washington, DC, the Los Angeles County Museum and the San Francisco Museum of Modern Art.

*The Hilbert Museum of California Art at Chapman University's exhibition has an exemplary work by Erle Loran currently on view.

Saturday, January 16, 2016

Anton Refregier: Controversial Mid-Century Modernist Challenges California History

Anton Refregier was one of the most interesting and controversial California modernists of the mid-century. Most of his paintings make a social commentary about the world around him. Utilizing broken planes of color and fractured lines, his modernist style often replicated the tone of the subjects he was painting.

Born in Moscow, Russia in 1905, Refregier emigrated to New York City in 1920. Soonafter he received a scholarship to the Rhode Island School of Design in 1921, afterwhich Refregier moved back to New York. Refregier was employed as an artist to  interior decorators, creating replicas of François Boucher and Jean-Honoré Fragonard paintings. Refregier returned to Europe in 1927 and visited to Munich where he studied under the modernist Hans Hofmann.
Anton Refregier "San Francisco 1934 Waterfront Riot", 1949 Color Screenprint (Collection of DeYoung Museum)

This print "San Francisco 1934 Waterfront Riot" by Refregier was recently appraised on Antiques Roadshow for $3,000-$5,000.

One of Refregier's most interesting commissions was the Rincon Annex Post Office in San Francisco. Commissioned in 1943, it was the last year of the Federal Art's project. In fact, the murals were not even painted until after World War II was over. Since it was an obselete notion to illustrate how hard work would end the economic depression --- Refregier choose to depict California's history, ugly bits an all, including the great Earthquake, the Goldrush, corrupt leaders, anti-Chinese riots, and the Bay Area's waterfront strike of 1934.

The mural was so controversial, that many people including former President Richard Nixon protested to have the work removed. They claimed it had a communistic tone and “defamed pioneers and reflected negatively on California's past.” Eventually the mural was saved, thanks to a group of artists and museum curators. 

Refregier's "Ploughed Under" an oil painting from 1935 serves as one of the artist's most important Depression era paintings. Depicting a Dust Bowl era farmer devastated by his bleak landscape, the painting represents the Depression-era experience. The shape of the broken and dilapidated house is mirrored by the shape of the farmer in his tired, worn overalls.

Wednesday, November 4, 2015

Anna Skeele: California Artist and Modernist of the Southwest

Rancho Church, New Mexico 1930 Oil on canvas

I recently discovered a most interesting California artist by the name of Anna Skeele (1896-1963 Monrovia, CA). Skeele was born in Wellington, Ohio and eventually made her way to New York City to study at the Art Students League of New York City under Charles Hawthorne and Frederic Bridgman.

Skeele, she also travelled to Europe where she became exposed to modernism at the Académie de la Grande Chaumière and with André Lhote in Paris. In a mostly male artist dominated feel, she travelled to the Royal Academy of Arts in Florence, Italy where she studied the history of painting.

Skeele eventually made her way west, moving to California in 1912. Here she took art classes at the California School of Fine Arts under the apprenticeship of Armin Hansen in Monterey, California. Skeele eventually began teaching at Pomona College. Also know as Katherine Skeele Dann, she married fellow artist Frode Dann.

The mid-century in Southern California produced a vibrant school of modern artists like Skeele. Because of the number of imporant art school in the area -- artists were able to innovate modern art techiniques and styles unlike anywhere else in America. Artists like Anna Katharine Skeele, Helen Lundeberg, Henrietta Shore, Henry Lee McFee, Richard Haines, among others developed a distinctive figurative modernist school of painting.

Skeele favored figurative art but painted in a modern style in which she utilized a vibrant Fauvist palette, cubist forms, flattened panes of color. Reminiscent of artist peers of her time period Diego Rivera, Thomas Hart Benton, and Georgia O'Keeffe -- Skeele developed a similar but signature style unique to her

Anna Skeele spent quite a bit of time in the Southwest -- and she became fascinated by the people and place. Some of her most striking paintings often depict Native Americans in and around New Mexico.
Image: Courtesy of Laguna Art Museum. Anna Skeele "Rancho Church, New Mexico" depicts San Francisco de Asis Mission Church in Rancho de Taos, built between 1772 and 1816 by Franciscan fathers. It was a favorite subject for artists who came to the area, among them Ansel Adams and Georgia O’Keeffe. Skeele emphasizes the massiveness of the structure, which fills the composition and dwarfs the figures nearby. The fluffy white clouds form a halo around the church.

Sunday, May 24, 2015

Henrietta Shore: California Modernist

Henrietta Shore Huntington Art Collection
As an art historian and appraiser with a specialization in California art -- I am always looking for paintings by interesting women artists during the modern period. One of my favorite modernists is Henrietta Shore.

Henrietta Mary Shore (1880-1963) was born in Toronto, Canada. When she decided to be an artist, she went to New York City to gain an art degree. She attended The Art Students League and learned American realist painting under the mentorship of the great artists Robert Henri and William Merritt Chase. Shore also travelled to London to attend Heatherly Art School as a student of John Singer Sargent. She learned her foundations of art from some of the very best 20th century American artists.

Shore was a founding member of the New York Society of Women Artists. But rather than continuing with realism she began exploring modernism. Often likened to Georgia O'Keeffe of the same period, she had a style that also used bold colors, sinuous lines and foreshortening. Henrietta Shore also happened to be interested botanical studies. Her work is now known as Abstract Realism.

In 1913, Shore was bewitched by Los Angeles and moved there. She was a founder of the Los Angeles Society of Modern Artists. West Coast modernists of the period included Mabel Alvarez, Belle Baranceanu, Elanor Colburn, and Helen Lundeberg, who explored technique, color, and composition-- but continued to paint realist subjects. Shore won a silver medal at the 1915 Pan-American Exposition in San Diego. She and her colleague, Helena Dunlap partook in a two-person exhibition at the Los Angeles County Museum (LACMA).

Shore’s had earned a strong reputation as an artist and a retrospective of her work was held at the Worcester Art Museum in Massachusetts. In 1924, she was chosen to be one of 25 American women represented women in Paris' exhibition. She also traveled to Mexico where she painted portraits of the famous artists Jose Orozco, Jean Charlot, and others. 

Upon returning to California, Henrietta Shore met photographer Edward Weston who made series of photographs based on Shore’s paintings. Shore eventually settled in Carmel, CA and continued to paint. During the Great Depression, Shore worked for the Treasury Relief Art Project and completed murals at the Monterey post office and another at the Santa Cruz post office.

Contact us with any artworks you think might be paintings by Henrietta Shore.

Wednesday, May 6, 2015

Robert Henri and his California Sojourn

The paintings of Robert Henri bewitched me into the world of art history as a young student. From his opulent portraits of wealthy industrialists to gritty depictions of New Yorkers like the sensuous Salome (below) his work beguiles viewers with truthful portrayals of turn-of-the-century America.

Copyright: Salome, 1909, John and Mable Ringling Museum of Art, Sarasota, Florida

Robert Henri was educated at the Pennsylvania Academy of the Fine Arts in Philadelphia and eventually became a teacher and trailblazer of American Realism painting. Henri became known as the father of the Ashcan School of painters, a group of artists who included John Sloan, William Glackens, George Luks, and Everett Shinn. Known as The Eight, they rejected the confines of the National Academy of Design began painting images of real life in New York and Pennsylvania.

Copyright: Gertrude Vanderbilt Whitney Whitney Museum of American Art:

In 1888 Henri travelled to Europe where he was exposed to the subject, colors, and minimalism of the modernists. After have establishing himself as an esteemed portraitist, Henri travelled to California in 1914 with his wife, the artist Marjorie Henri. 

The recent exhibition at the Laguna Art Museum focuses on this period of work and is one of the most interesting exhibition I have seen in a long time. Robert Henri's California Realism, Race, and Region 1914-1925 explores Henri's painting done in La Jolla, Los Angeles, and San Francisco. 

Henri was tantalized by the region. This is most glaringly seen in his inspired palette of bright yellows, vibrant greens, and sparkling blues -- instead of his trademark oil paint done in browns and black used in his East Coast works. 

What is most interesting about Henri's West Coast work is his pursuit of real-life characters for his portraits. Instead of painting wealthy patrons he was intrigued by everyday people -- like the local Mexicans, Native Americans, African Americans, and Chinese of Southern California.

Copyright: Sylvester Private Collection 
Other artists in the Los Angeles area were also seeking Social Realist subject matter. Artists like Francis De Erdely, Richard Haines, and Mabel Alvarez were interested in depicting intriguing people of the area -- including dancers, workers, immigrants, and minorities. Artists like these as well as Henri wanted to capture the character and personality of this people -- which he does masterfully with paintings like Sylvester Smiling and Po Tse (Water Eagle).

Copyright: Tom Po Qui Denver Art Museum 
A most interesting part of the exhibition were the missing paintings by Henri. Mounted on the wall of the Laguna Art Museum were black and white photographs of paintings stated as "location unknown." As an art appraiser and historian it is interesting to think about where these paintings might be . Perhaps they are burned, lost, or hidden in the clutter of someone's basement. These might be unsigned works so a collector would not know whether it was a Henri painting. The lost painting have titles including Sylvester, Mexican Man, Mexican Woman, Ramon, Yen Tsidi, Ground Sparrow, and Machu.*

Robert Henri's California Realism, Race, and Region 1914-1925 is a must see. The Laguna Art Museum (which also has a wonderful permanent collection to note) has the Henri exhibition up until May 21, 2015. As stated in the worthwhile exhibition catalog by Grand Central Press, "Henri’s eagerness was rooted in his quest for new settings and fresh subjects. “I am now quite convinced that San Diego is one of the most interesting and beautiful places in the world and we shall head that way and will not be convinced otherwise until we have seen the place and have been turned away.”"

NOTE: Readers, if you have seen these paintings or think you have a painting by Robert Henri, please contact us.