As Enron was well versed in the smoke and mirrors of accounting practices, so too has Sotheby’s and of course Christie’s been encouraged with the buyer collusion offered by the irrevocable bid sham.  This is now the duopoly’s new form of giving guarantees, and still collecting generous fees.  With their intractable buyer’s premium, they will always be able to manipulate the market. As bad as the gross conflict of interest on getting a seller’s commission and fixed buyer’s premium on an item, the irrevocable bid casts the greatest form of deceit on the buyer.  The seller basically is made oblivious to this shenanigan, in the hope of the auctioneer’s ability…

I start 2010 with the anticipation that it will be better than the previous year. After reading Niall Ferguson’s book, The Ascent of Money, the road to riches over time has evolved quite dramatically in form and format.  So as I look ahead, where have antiques and art come from and fit into the future of money. Perhaps the greatest hope (and tidbit from the book) for an aspiring member of the art and antiques trade is the fact that the great Rothschild family dynasty started in Austria as an antiques dealer. Why didn’t the antiques market evolve like Dutch tulips, real estate, oil, or government bond?  Simple, the Rothschild’s…

The news in the trade has certainly been anything but robust for the image and financial prospects of the industry.  However, there seems to be an evolutionary movement of who is willing to try to challenge the current form of that process with a new imaginative approach.  Leigh Keno, who is known as a dealer in high end Americana has initiated an auction firm that “will have no estimates, no reserves”.   Sounds compelling! The press release as reported in trade magazines states that he is aiming for inventory between $100 and $5,000 of value, however I have no idea what kind of seller’s commission or buyer’s premium will be in…

Mid 20th Century decorative and fine arts has been the dominant period of collecting and decorating, certainly for the last decade.  The classical English, French, and Italian designs have been relegated to the dust bin of the out of fashion styles, or have they just been dormant and unnoticed by the public.  Taste has always been an evolving phenomenon and the present affinity with 20th Century and modern design will invariably change, but how and when? My glimpse into where trends are heading comes from my contact with interior designers and what they are looking for to satisfy their clients’ needs and comforts.  Residential interiors have always been about matching…

The first question concerning how the antiques business will operate down the road is will it survive at all or be forced to evolve, like the banks and auto industry, but without government assistance.   It also creates the perfect storm for change and innovation.  Just as the Sotheby’s/ Christie’s duopoly operates on deception, fraud, and conflicts of interest, dealers as a group are too distant and fragmented to collude so successfully.  If 50 dealers in any one antiques market operated with their own rules, like the duopoly operates, then dealers would probably make more money.   But dealers need to know that any form of standardizing the sale of antiques…

Supply and demand are the measures we use to gauge a price.  The influences which have a cause and effect on those functions are fluid and every changing course.  Sounds like a classic definition of how antiques are priced.  Whether it is negotiating with a dealer or paying the highest price (including the staggering buyer’s premium) at auction, a price is agreed.   With all the news and reality that prices for “antiques” has dropped, there are always exceptions that buck the trend.  20th Century decorative arts have certainly not lost ground.  The key to demand in the antiques business has now more than ever been subject to style preference.…

Bid rigging in the art and antiques world has always been blamed on buyer collusion.  It seems that dealers are fair game for such accusations, whether it’s a ring format or having two or more competitors agreeing to restrict their bidding activity.  There is however, always the possibility that there could be another bidder to upset the plan.  But that opportunity is routinely blunted by the power of a reserve, and a secret one at that.   While I don’t like the idea of a reserve price (without it you get real market valuation), it does help set a floor price.  But a secret reserve is a whole different ball…

I just had a letter to the editor of The Maine Antiques Digest published in the July 2008 issue.  I took exception to the position of the author of a monthly column on Auction Law as it related to bid rigging. It’s a topic I hope to discuss in future blogs.   Letter to the Editor:   In your monthly feature on Auction Law and Ethics, Steve Proffitt discussed the legal processes of the Sherman Antitrust Act to protect consigners from bid rigging.  As he clearly states “bid rigging, price fixing, and market allocation have each been determined to be per se violations of the Act”.  His perspective and focus…

Antiques and art are not really so similar.  While they both fall under the same industry category, selling these items seems to require very different approaches.  As I strolled down the side streets of Chelsea’s West 24/25/26th Streets, I saw techniques and environments for selling art that just doesn’t happen for antiques and made for some interesting observations.   The places we see antiques for sale are not very dynamic or energizing.  I can’t image how the Winter Antiques Show in New York City has radically morphed into a Miami Art Basel.  To take it one step further, if you went to any antiques dealer’s showroom/warehouses, would they be places…

What’s an antique or piece of real estate worth? It’s not a simple answer but requires thought, knowledge, and evaluating the timing of the opportunity to attain a valuation, for both buyer and seller.   Whether it is giving one more bid at an auction or asking for concessions from the owner of the property, the valuation process should have an unencumbered flow on reaching a price conclusion. Antiques and the decorative arts are very similar to real estate in the valuation process, perhaps more so than fine arts. The look and location of piece of real estate go hand in hand with the amenities and best use function of…