A $180 Million Picasso: What’s Making the Art Market Sizzle
The art market is hotter than a hoisted Rembrandt.
Last night at Christie’s in New York, Picasso’s “Les Femmes d’Alger (Version O)” sold for almost $180 million – the highest price ever paid at auction for a piece of art. There were said to be five bidders, and the winner remains anonymous.
At the same sale, a Giacometti sculpture, “L’homme au doigt,” went for a total of more than $141 million.
On May 5, at the first major auction of the spring selling season, Sotheby’s pulled in $368 million. It was the second-highest sale of Impressionist and modern art in the history of the auction house, according to The New York Times. The top seller was van Gogh’s “L’allée Des Alyscamps,” which fetched $66.3 million.
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The haul represented a 67 percent increase over Sotheby’s spring sale a year earlier, according to Bloomberg, which noted that many of the buyers were Asian.
The May 5 auction was only the second-highest because Sotheby’s held a sale last November that took in $422 million.
And tonight at a Sotheby’s auction of contemporary art, a painting entitled “The Ring (Engagement)” by the Pop artist Roy Lichtenstein could sell for as much as $50 million, the Times said.
What’s behind all those staggering numbers?
About a year and a half ago, the columnist Felix Salmon (then at Reuters, now at Fusion) ruminated about whether there was a bubble, which he defined as often driven by FOMO (fear of missing out), or a speculative bubble, one fueled by flippers, in the art market. His conclusion: the art market bubble was definitely not speculative.
“The people spending millions of dollars on trophy art aren’t buying to flip…,” he wrote.
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Still, Salmon said he was seeing signs that the market could be turning speculative. But they may have been false signals.
Recently, The Wall Street Journal wrote: “Spurred by the momentum of several successful sale seasons and an influx of newly wealthy global bidders, the major auction houses…say demand for status art is at historic levels and shows no signs of tapering off.”
But why?
In an April 17 article, the global news website Worldcrunch asked Financial Times journalist Georgina Adam, who wrote the 2014 book Big Bucks—The Explosion of the Art Market in the 21st Century, why so much money is rolling around the art market and driving up prices.
“Rich people used to be rich in terms of estate or assets, but not so much in terms of cash, like they are today,” she said.
“This growing billionaire population from developed or developing economies has money to spend and invest,” said the Worldcrunch article by Catherine Cochard. “For many of them, art — in the same way as luxury cars or prêt-à-porter — is an entry pass to a globalized way of life accessible through their wealth.”
That is a development that the keen eyes at the auction houses haven’t missed.
DOJ Indicts Democratic Lawmaker for Corruption
Martin Matishak, The Fiscal Times
The Justice Department has indicted Rep. Chaka Fattah (D-PA) on almost 30 federal counts of political corruption.
The 11-term congressman and four associates were indicted on 29 federal charges, including bribery, money laundering, falsification of records, and multiple counts of bank and mail fraud, the department announced Wednesday.
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The charges against Fattah and his associates stem from his failed run for Philadelphia mayor in 2007.
Fattah and the others "embarked on a wide-ranging conspiracy involving bribery, concealment of unlawful campaign contributions and theft of charitable and federal funds to advance their own personal interests,” according to Assistant Attorney General Leslie R. Caldwell.
Justice alleges that Fattah borrowed $1 million from a wealthy donor during his mayoral bid and that he returned $400,000 in unused funds and developed a scheme to repay the remaining $600,000 by tapping charitable and federal grants through a local non-profit the Pennsylvania lawmaker created.
Federal officials also allege that the Fattah sough to repay supporters by offering federal grants and used funds from both his mayoral and congressional campaigns to pay down his son's student loan debts of around $23,000.
"Public corruption takes a particularly heavy toll on our democracy because it undermines people’s basic belief that our elected leaders are committed to serving the public interest, not to lining their own pockets,” she said in a statement.
House Minority Leader Nancy Pelosi (D-CA) said that Fattah has stepped down as the top Democrat on the House Appropriations Commerce, Justice, Science and Related Agencies subcommittee.
Here’s Why Americans Are Keeping Their Cars Longer than Ever
As cars get more reliable Americans are holding onto their vehicles for longer than ever before. The average age of cars and light trucks is now 11.5 years old, according to a new report from IHS Automotive.
In addition to better reliability, cars are getting older because Americans bought far fewer new cars in the years following the Great Recession, as concerns lingered about unemployment and the strength of the economy.
Even as consumers have started purchasing new vehicles again, they’re still holding onto their older ones. The average length of ownership of a new vehicle reached 6.5 years in the first quarter of 2015, more than two years longer than in 2006. The number of cars more than 12 years old continues to grow and is expected to increase 15 percent by 2020.
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IHS predicts that the average age of vehicles will inch up slightly over the next few years, hitting 11.7 years in 2018.
The number of cars on the road hit a record 258 million, posting a 2.1 percent increase over last year, driven by the purchase of new cars. IHS expects that volume of cars less than 5 years old will increase by 24 percent over the next five years.
Consumer sales of autos were on pace to rise 4.2 percent this month, according to TrueCar, compared to July of 2014, thanks to increased demand, summer sales events and the growing popularity of premium brands.
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The Most Expensive Cities for Singles -- and the Cheapest
Looking for love in all the pricey places? Check out these lists of the most and least expensive cities for singles before you go on that next date or plan your next move. Looking good doesn’t come cheap, and the price of a decent wardrobe and a gym membership add ups before you even step out the door.
To determine which cities were the least and most affordable for singles, GoBankingRates examined 89 cities and rated them according to four expense categories -- clothing, dates, gym memberships and rent -- using data from Numbeo.com. “Singles are more likely to exercise, and to have a gym membership,” says Elyssa Kirkham, a finance writer for GoBankingRates. “They’re more likely to rent than own a home, and spend more money on dates and clothing.”
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San Francisco is the most expensive city for singles, especially when it comes to rent. Rent is 30 percent more expensive in San Francisco than it is in Honolulu. The cost of a date here is $147, compared with the median cost of $109. California just might be the most expensive state to date in, claiming seven of the top 15 spots: San Francisco, Fremont, Glendale, Irvine, Los Angeles, San Diego and Oakland.
The second most expensive city? New York City, which boasts the most expensive gym membership at $90 per month. Clothing costs here are the second-highest in the nation -- bad news for all the Carrie Bradshaws out there. And date night will set you back $145.
The most expensive date night in the country is in Washington, D.C., which came in third overall. Date night in our nation’s capital costs $166 for dinner, a bottle of wine, two movie tickets and a 10-mile taxi ride. Compare that to Chattanooga, Tennessee, which had the cheapest date night at $78.
Looking for more bang for your buck? Move to Reno, Nevada. Rent here is just 86 cents per square foot, and a night out averages $97.30. Keep in mind, though, that “the Biggest Little City in the World” was once known as the divorce capital of the world, so dating there may offer less promise than other locales.
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Most Expensive Cities for Singles
- San Francisco
- New York
- Washington, D.C.
- Honolulu
- Boston
- Fremont, California
- Glendale, California
- Anchorage, Alaska
- Miami
- Seattle
- Irvine, California
- Los Angeles
- San Diego
- Oakland, California
- Madison, Wisconsin
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15 Cheapest Cities for Singles
- Reno, Nevada
- Tucson, Arizona
- Grand Rapids, Michigan
- Tacoma, Washington
- Indianapolis
- Mesa, Arizona
- Little Rock, Arkansas
- Albuquerque, New Mexico
- Huntsville, Alabama
- Memphis, Tennessee
- St. Louis, Missouri
- Jackson, Mississippi
- Stockton, California
- Omaha, Nebraska
- Chattanooga, Tennessee
Donald Trump Isn’t as Rich as He Says…but He’s Still Pretty Rich
“I’m really rich,” Donald Trump boasted last month when he announced he was running for president. A new analysis by Bloomberg confirms that claim, but finds that the real estate mogul and presidential candidate is worth about $7 billion less than he claims.
When he announced his presidential bid, Trump touted a net worth of about $8.7 billion, a figure that soon ballooned to $10 billion. But Bloomberg calculates his wealth closer to around $2.9 billion. The Bloomberg Billionaires Index, a daily ranking of the world’s biggest fortunes, arrived at the value using both prior-known information and a 92-page personal disclosure form that Trump filed with the Federal Election Commission.
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The federal form that all presidential candidates are required to submit asks only for broad ranges in asset values, not specific sums. Anything above $50 million in value is lumped together in one category, which in Trump’s case left plenty of room for questions about just how valuable some of his assets are. The federal report also doesn’t require candidates to list personal property like art, clothing or real estate that’s for his own use.
The Bloomberg analysis went into much more depth, using figures such as purchase dates, square footage, rental rates and more.
The disclosure form revealed that most of Trump’s fortune comes from real estate holdings, such as the Trump Doral resorts in Florida and Trump Tower on Fifth Avenue in New York City. Other lucrative properties include premier golf courses in the U.S., Ireland and Scotland.
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Trump had valued his golf and resort properties at $2 billion. Bloomberg, using price-to-sales ratios for similar properties, put the value at a combined $570 million.
The Bloomberg methodology also doesn’t put much value in the Trump brand, counting only the cash being held as part of licensing or other business deals. “Trump’s own estimations,” Bloomberg noted, “include much higher values for his brand.”
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In a Black Eye for Wearable Tech, Nike Giving Refunds for FuelBand
If you thought that the calorie count and steps tracked by your Nike FuelBand were inaccurate, you may have been right.
Nike and Apple have agreed to settle a class action lawsuit claiming that the companies made misleading statements regarding the product’s ability to accurately track calories and steps, according to a website maintained by settlement administrator Gilardi & Co.
The companies have denied the allegations and claim they broke no laws, but they have agreed to a settlement in which Nike will give consumers who join the class action suit by January $15 or a $25 Nike gift card. The total cost of the refunds could reach more than $2 million.
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Anyone who purchased a FuelBand from January 19, 2012 through June 17, 2015 is eligible for the refund.
Last year, Nike began shifting its focus away from producing FuelBands, choosing instead to focus on apps, including one for the Apple watch, that support fitness tracking. The company has said it has more than 60 million digital fitness software users.
The FuelBand was an early entrant into what has become a crowded field or wearable fitness trackers, despite questions about their accuracy. However smart watches, which offer built-in fitness trackers along with other apps, may soon eclipse the demand for that standalone products.
A report released last year by tech analysts Juniper Research projected that revenue from wearable tech, would increase from $4.5 billion in 2014 to more than $53 billion in 2019.