Financial crisis looms over London art extravaganza

Wed Oct 15, 2008 9:49am EDT
 
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By Mike Collett-White

LONDON (Reuters) - The art world descends on London this week for a packed calendar of fairs and sales, and the talk over cocktails and canapes will center on whether financial turmoil is about to end the art market's gravity-defying boom.

Values for contemporary art have set new records over the last year, shaking off U.S. subprime mortgage woes and the subsequent slide in values of property, stocks and oil.

But the severity of more recent events on money and equity exchanges around the world, and the crisis hitting the banking sector, mean experts are more cautious about the outlook for high-end art than they have been for several years.

"I think it is probably a reason to be more pessimistic -- because the gravity of events has been of such a magnitude," said Anders Petterson, founder of ArtTactic which tracks confidence in the art market.

"The crisis up until recently was hurting but was not really painful. In the last couple of weeks it has become painful."

Auction houses Sotheby's and Christie's are still confident that their October sales, which are held to coincide with the giant Frieze contemporary art fair in London every autumn, will survive the financial crisis.

"We have some incredible works coming to auction, some of which have been in private collections for 40 years," said Pilar Ordovas, head of post war and contemporary art at Christie's London. "The feedback is very strong and we remain confident."

She believes more investors are looking at the art market as a possible safe-haven for their millions at a time when money is at risk elsewhere.   Continued...

 
<p>A visitor walks behind "Anatomy of an Angel" by Damien Hirst during a preview of an upcoming auction of his work "Beautiful Inside My Head Forever" at Sotheby's in London, September 8, 2008. REUTERS/Suzanne Plunkett</p>