The Wonders of Advertising Technology

October 21, 2008

This story is from WCBSTV in New York:

New York’s transit agency is testing digital advertising screens on the sides of buses.  The screens can target ads for specific neighborhoods. The ads, which resemble TV commercials, could even advertise coffee in the morning, and beer after work.  Titan Worldwide has a 10-year, $800 million contract to sell ads throughout the city’s bus and commuter-train systems. The company says GPS technology allows it to change the ads based on the buses’ locations.   The Metropolitan Transportation Authority is testing the system on a Manhattan route, with an eye toward 200 buses in the first quarter of next year.

Is The Murakami Failure A Sign?

October 21, 2008

While I’ve been watching this week’s auctions at Christies and Sothebys, I completely missed the action at the Phillips de Pury & Co sale last Saturday.   It was, say the reports, a complete bust with 45% of the 70 lots failing to sell.  The sale’s minimum total estimate was $36 million, but the actual return was only $10 million.

The biggest shock would have been the utter failure of the Murakami to gather any interest.

The most dramatic moment came when Murakami’s 21-foot-high Fiberglass sculpture “Tongari-kun” (2003-2004) failed to attract a single bid. It was expected to fetch at least 3.5 million pounds. The Japanese artist, clad in a black puffy jacket, attended the auction and laughed after the lot was passed in a hushed room.

My opinion of Takashi Murakami is not high, and I’m glad to see a check on the extraordinary values his works have attracted lately.  But it seems to have been a more widespread withdrawal of prices rather than a considered jab at artistic taste:

Seated on rows of Philippe Starck chairs, bidders ignored works by leading American contemporary artists priced between 250,000 pounds and 500,000 pounds. Among the casualties were Lisa Yuskavage’s 2003 oil-on-canvas work “Dark Garden II,” a 2001 joke painting by Prince and a pink acrylic work of blank advertising signs from 2004 by Ed Ruscha.   Not a single lot sold for 1 million pounds or more. None of the 10 top-selling works managed to achieve a hammer price above the higher estimate. The top lot, Warhol’s “Flowers” (1964), fetched a mid-estimate 735,650 pounds, going to a telephone bidder. “Cleaning the Pole,” a sensual nude by Marlene Dumas, soon to be featured in a solo show at the Museum of Modern Art in New York, fetched 553,250 pounds, below its high estimate of 600,000 pounds …

A brightly hued, 9-foot-high abstract expressionist painting by Joan Mitchell was another significant flop, with a presale- estimate range of between 2 million pounds and 3 million pounds.  The speculative demand that has recently boosted prices for Chinese contemporary art evaporated. A painting of a vacant-eyed boy by Zhang Xiaogang, titled “Bloodlines Series: A Boy,” (2002) failed to sell. So did a group of bronze smiling figures comprising “Contemporary Terracotta Warriors No. 7” (2005) by another Chinese-art star, Yue Minjun. They were estimated at 200,000 pounds to 300,000 pounds and 350,000 pounds to 450,000 pounds respectively.

The Bloomberg article suggests that this is a tipping point.

“The timing could not have been worse for an auction,” said Michael McGinnis, worldwide director of contemporary art at Phillips.  “The economy is in a somber mood. There was a lot of interest but interest didn’t turn into bids.” London dealer John Austin said it was the worst-performing auction he’d seen since 1991.  “There’s been an awful lot of speculation,” he said.  “We’ve got to get back to the real market where people buy things because they really like them.”

And it is true that the Christie’s and Sotheby’s auctions were also considered sub-par.  Art does seem an obvious choice for pullback in the discretionary spending of the wealthy.  The real sign of a market crash will come, though, only if we start to see the emergency sale of certain major works that have been purchased at inflated prices, by Russians for example, over the last half-dozen years.

Another Day, Another Auction

October 19, 2008

Just a heads up that tomorrow morning at Sothebys in London is another Contemporary Art auction, with some interesting pieces.  It will be a useful check against today’s prices at Christies.  I’ll update this post with some results as they happen.

Update:  Nothing out of the ordinary so far as I could tell.  Reasonable prices on the whole.  I did notice that Yoko Ono’s picture of her mother’s breast was either withdrawn or found no buyer (the upper estimate was only $8,000).  It is annoying, however, that Sotheby’s web site seems to remove most of the lots’ images when giving the results.

What’s Happening In Aisle Three?

October 19, 2008

As a timely complement to my What’s Happening post, the New York Times has an interesting piece about research into what consumption habits change during economic downturns.  These are extensions of what I remember as a boy was called the “hemline index”:  hemlines went up and down in lockstep with economic prosperity.

According to those who study these things, in a recession or depression people tend to prefer songs that are longer, slower, with more meaningful themes. It’s “Bridge Over Troubled Water” rather than “At the Hop.” Playboy’s Playmates of the Year tend to have a more mature appearance — “older, heavier, taller and less curvy”, and American actresses with mature features — small eyes, large chins, and thin faces — are more popular.

In rough times people also buy more laxatives (because they are stressed) and less deodorant (because they are not dancing around with glee).  In addition, they

buy more of the things that have less water in them, things that are not so perishable. Instead of lettuce and steak and fruit, it’s rice and beans and grain and pasta.

A recent survey by Nielsen reported that tobacco, carbonated drinks and eggs were vulnerable to an economic downturn, while candy, beer and pasta sauce are “recession-proof”.  The recession will also, inevitably, bring with it an increase in property crime and mental depression.  Employee-assistance programs have already seen a strong increase in the number of those seeking help.

However, against all this, some experts suggest that a new recession could actually improve the nation’s physical and mental health in some ways.

“People are physically healthier in times of recession,” said Christopher Ruhm, an economist at the University of North Carolina at Greensboro. “Death rates fall, people smoke less, drink less and exercise more. Traffic fatalities go way down, which is not a surprise when people drive less. Heart attacks go down. Back problems go down. People have more time to prepare healthier meals at home. When the economy weakens, pollution falls” …

In a study of coffee growers in Colombia, Grant Miller, who teaches health policy at Stanford’s medical school, found that infant and child mortality rates fell as coffee prices slumped, and concluded that it was because parents had more time to take care of their children.

These positives are not measured in the official figures.  As one the experts said:

“[N]othing in the G.D.P. captures what you gain if you cook and eat in a leisurely way with your kids.”

Fascinating stuff.  Especially fascinating to both live and study the phenomenon at the same time as we are doing today.

Auction Update

October 19, 2008

Christie’s Post-War and Contemporary Sale is going on as I blog.

Lucian Freud’s small painting of “Girl Reading” just about reached its estimates, selling for $3.8million.  And his iconic portrait of “Francis Bacon” barely crept over the lower estimates to fetch $9.4 million.  A third work, “Susie” didn’t sell.  Francis Bacon’s own “Portrait of Henrietta Moraes“, with pre-sales estimates between $9.5 million and $13 million, also appears not to have sold.

A number of Warhols are  being left on the shelf; presumably they didn’t meet their required minimums, and two Gerhard Richter’s also failed to sell.

The three new Chinese artists who were on display had mixed fortunes.  Yang Pei Ming failed to sell his “Autoportrait“, and a work by Yue Minjun sold for a few points less than the anticipated minimum.  However, Zeng Fanzhi almost doubled his estimate, selling an untitled work for $500,000.

To set my teeth on edge, it seems that Lucio Fontana is going to be the star of this show.   One of his la fine de Dio series just sold for an astonishing $15.6 million!   I really must be missing something.  The Inflated Phrases for this one include:

“Lucio Fontana’s Fine di Dio are a series of thirty-eight oval-shaped oil paintings made between March 1963 and February 1964 for three different exhibitions of his work held in Zurich, Milan and Paris. The supreme encapsulation of the ‘Spatialist’ art that he pioneered in the 1950s and ’60s, these works now stand as mystical icons that since their creation have proved themselves to be strangely prophetic of much about the way that modern physicists now view the cosmos.  Strange, mysterious and imposing, these punctured monochrome canvases in the shape of an egg are more than mere paintings. They are ‘Spatial concepts’ that invoke the fundamental mystery of the cosmos…”

On the other hand, I love Richard Prince’s “Dude Ranch Nurse #2” and I’m glad to see it reach $5.5 million.  I wonder if that is a record for him?

Almost at the end, a Damien Hirst medicine chest called “Untitled AAAAAAA” was left unsold after pre-sale estimates of around $400,000.

In all, the show had a value of around $50million.  But 19 of the 45 lots were left unsold, and I am sure that must be a disappointment.  Was it just the quality of the auction? Or is this a sign that money is tighter than it has been?  Hard to say yet.

What’s Happening?

October 18, 2008

This blog deliberately eschews politics.  I’ve been there, done that, and now I feel a whole lot better.  However, there are some mega-political issues that touch on what we do here: the current economic crisis, for example.  This opinion piece by “future thinker” David Houle suggests that the next stage of the crisis is a collapse of consumer spending; and this blog is definitely interested in consumerism as both culture and economics.

Consumer spending makes up two thirds of the GNP of the country. The past three decades has been a time of unparalleled consumption in the U.S. The size of houses grew, the number of cars per household grew.Tthere was an explosion of electronic goodies that filled every room, pocket and briefcase. Extravagance increased in household purchases, dining out and travel. This arc has fueled the American economy since the recession of the early 1980s. That arc is now going to lose its trajectory and a fundamental shift is about to occur.

He then analyzes this coming shift as a function of each of the currently-consuming generations:

Those that are retired now fear that the golden retirement will be a silver or bronze one at best and there is nothing to be done but to spend less.

The largest generation, the Baby Boom generation, now feels as though they may never be able to retire. The greatest amount of personal wealth in America is controlled by those 50 and older and these people all feel suddenly poor and no longer have the secure faith in their financial future that the ever rising value of housing and stock provided. The reaction is to stop buying stuff …

To compound matters, the X and Y generations now see that if the baby boomers postpone retirement indefinitely, they may not move up the promotion ladder as fast as they had thought. This means they realize they can no longer spend on the assumption of increasing family incomes.

The Millennials that are now entering the workplace see this mess and realize that they can not trust the social institutions that the older generations did. They feel that they are being handed a bad deal, that the economy is not the booming one their parents showed them. This means they realize that they will need to be self sufficient economically, which is why a higher number of college graduates than ever before are desiring to be entrepreneurs so they can at least attempt to control their own destiny. Lavish spending is not in this picture.

He concludes that

A new social trend will begin. Thrift will replace extravagance. As small is the new big, thrift will be the new behavior, the smart and cool thing to do.

An interesting analysis with enough obvious truth to be worth reading.

Not Built For Comfort

October 18, 2008

In London this morning, there was an auction of Modern & Contemporary Design — furniture, sculpture and other doodads.

The 45 lots took about $2 million, almost half of which went for a single item:  ‘Orgone Stretch Lounge‘ by Marc Newsom.   This is a 6 foot long aluminium and enamel creation.  And, to be honest, I’d prefer the Alien Sofa and save myself almost a million bucks.