Amna: The global art market
totals nearly $70 billion, with
returns in recent decades that
outpace bonds, by some
estimates.
That growth has spawned new
investors looking to make some
money in what is a booming
sector.
Economics correspondent Paul
Solman takes a look at the
prudence of investing in art for
our arts and culture series
, canvas.
>> The grand opening of artex, a
European art stock market which
plans to start trading soon,
selling shares in art, like this
Francis bacon, one work at a
time.
Yassir benjelloun-touimi: We are
the equivalent of NASDAQ, the
New York stock exchange or the
London stock exchange.
Reporter: Co-founder and CEO
yassir benjelloun-touimi.
>> And instead of buying a
corporate share in a company,
you buy a share into a
masterpiece.
Reporter: One of 550,000 shares
in a triptych by the late
English painter Francis bacon,
of his lover George dyer as an
ipo, a public offering shares
, priced at $100 each.
And what do I get for that?
>> You get the appreciation in
the exact way you get the
appreciation if you're buying an
ounce of gold.
Reporter: What if Francis bacon
paintings are no longer popular?
>> When you buy shares in apple
at any time, are you sure
they're not going to lose value?
No.
Reporter: Now artex is the
latest firm to sell shares in
individual works of art, but not
the first.
>> In the past, collectors and
dealers have often bought things
in small consortiums.
Reporter: Wall Street journal
art market correspondent Kelly
crow.
>> The British railway pension
did sort of pioneer this idea
that you could pool your money
and buy better things and hold
it for a time and resell it.
Reporter: So somebody can buy a
share -- this is a Warhol or a
reproduction of a Warhol that
you own, right?
>> Yeah.
Reporter: But nowadays, new
York's masterworks already sells
art shares to the public as you
would stocks.
Chief investment officer Allen
sukholitsky.
>> Masterworks is a firm that
makes art an investable asset
class, the first firm that's
ever done it.
We started in 2017, so we've
been doing it now for several
years.
Reporter: During which the
firm's value has climbed to more
than a billion dollars, it says,
employees beating the bushes for
marketable high value artwork
and customers, to whom to hawk
shares in a "Masterwork" like an
Andy Warhol or a yayoi kusama.
>> She's actually about 100
years old, which is always
interesting.
It tells you that artists have
definitely cracked the code on
living forever.
Reporter: The usual minimum
investment $15,000, for a share
, of an artwork whose price is
derived from an auction
data-base tracking 7000 artists,
post-world war II.
Masterworks says it only buys
"Blue chips," artists like
Warhol and kusama whose values
have outperformed the stock and
bond markets for the past 20
years, Ed rucha, kaws --
supposedly "Masterwork-backed"
securities.
So does this pose a threat to
traditional sellers, like
auction house Christie's, whose
giacometti transmogrifying into
a degas had me flummoxed, till
learning they were holograms
digitally shipped to potential
buyers.
>> We really see it as an
expansion of the market.
It's an innovative way to
broaden our market.
Reporter: President for American
art Bonnie Brennan.
>> If this is a way to meet new
clients, all the better for us.
Reporter: But better for
everyone?
Well, as always, warns reporter
Kelly crow, investor beware.
>> The art market, it is just
super unregulated.
It's kind of like a wild west
sphere.
If you want to buy a $100 share
just for kicks in the same way
that you would go to a baseball
game just to have fun and see
how something does roll the
, dice, have some fun.
I just would be a little
nervous, you know, taking out a
second mortgage.
Reporter: Even for a painting as
highly valued in the current
market as the Francis bacon
triptych?
>> These George dyer triptychs
that sold in 2017 for mid $50
million are important because
that lover eventually committed
suicide on the eve of a major
show of bacon's.
We really love the soap opera of
an artist's life and how that
feeds into the work.
>> It's called hot pie, which
simulates, you know, a hot pie
sitting on the kitchen window,
cooling.
Reporter: Yeah, I see.
That's the steam from the hot
pie.
>> Exactly.
Reporter: Contemporary art
consultant Alex glauber, who
helped his client buy this work
by Alex da Corte.
Glauber has sold to masterworks.
So an art stock market is a good
thing?
>> It certainly brings more
money and attention to the art
market.
But I don't know if it's
necessarily healthy for art and
the appreciation of art long
term.
Reporter: Why not?
>> Why?
Because if the conversation is
more about the money than the
art, that really devalues, it
undermines the very purpose of
art.
Reporter: But the argument is
hmm, I'll start out with it as
, an investment.
Then I'll get interested in it
and I'll learn more about it.
I'll become an art appreciator.
>> But if what you're trying to
learn about is why this is a
savvy investment, why this
artist is poised for an uptick
in their value?
That's very much at odds with
what perhaps put that artist in
that position in the first
place.
Reporter: In other words, we're
talking speculation, as in some
1000 picassos, and innumerable
other brand-name works stored in
warehouses around the world.
Or more recently, in digital
and fts, non-fungible tokens,
that boomed and then swooned
since I interviewed investor Lin
Dai barely a year ago.
So what's happened to the nft
market since last we talked?
>> You know, there's a lot that
has changed.
We saw the speculative bubble
pop.
Reporter: Which had seen Lin
Dai's "Bored ape" nft double in
value to $400,000, before
falling back down to around
$100,000 today by his stomach.
Do you have second thoughts
misgivings about having bought
, your bored ape?
>> No, absolutely not.
I think certainly the bored ape
probably will hold its value
over time.
Reporter: Unlike, say, jozef
Israel's' pancake day which
fetched more than one million
pounds in 1895, $1 billion or
more today depending on how you
convert prices.
Israel's largest painting at
auction in recent years
brought $35,000.
Just one of countless examples
that illustrate what philosopher
Barbara herrnstein Smith calls
the "Contingencies of value,"
--
>> Value is not fixed, inherent,
object, and part of objects, but
the product of numerous
interactions between people and
things in their universe.
And it's contingent in the sense
what effects those interactions
changes.
The question is always going to
be, will it continue to be
valued over time?
Not will it continue to have
value over time.
Reporter: And thus, for the
investment value of art we've
learned to prize, from Leonardo
and rembrandt to Israels, van
gogh and Picasso, bacon, Warhol,
kusama, a board ape, time will