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Mon Dec 10th 22:02 PM | Rating: 0 0
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Sotheby's (Falling) Stock as a Market Indicator

Thanks for the reply - maybe I was a bit harsh. While I'm certainly not bullish on the art market, and some (Eli Broad) say the peak was months ago - I do think that the recent stock activity wasn't necessarily reflective of "fair market value". Perhaps overvalued before, and undervalued now (and volatility is often a sign of regime change), and do think that the recent dip was unduly influenced by unreasonable psychological factors, not true valuation. I do certainly agree, though - a year, two years from now, will be wondering how BID/the art market had so much growth.
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Tue Dec 4th 20:21 PM | Rating: 0 0
Commented on:
Sotheby's (Falling) Stock as a Market Indicator

Would be nice to use BID as a leading market indicator, but this recent dip was because Sotheby's made risky financial deals and got burned in their Imp/Mod sale. The art market seems fine for now (though few would say these flush times can go on forever), but Sotheby's screwed up, and the share price took the brunt of it - though because people who don't work in the art market glean too much from sale results, it's all sell, sell, sell - the sky is falling. (The sale was disasterous, but they had a great one the next week, but from this can clearly see that the stock price was held aloft by extremely unrealistic assumptions "Perfect sales always and forever!!")

S's, being the only publicly traded art business, is taken as a proxy for the whole art market (which is susceptible to wide emotional swings as to concerns about its "health"). This makes for a volatile stock.

Let me tell you about the very rich. They are different from you and me. You need a LOT of money to buy a $20M picture (i.e. a couple hundred...), and chances are the noise that is financial news won't affect the resources of those who command that sort of wealth. The picture might go for only $15M, but the funds are still there.
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