I was reading a WSJ article in the last week about a recent art auction that broke the record for the highest price paid for piece of art at an auction (about $140M).
My question is what is the value of the Mona Lisa and provide the rationale for how you came up with this valuation? Priceless is not an answer…everything or person has a price.
Purely hypothetical questions with no real-life bais deserve purely hypothetical answers with no real-life basis.
Therefore, my answer is: priceless.
In less than three minutes, Vincent van Gogh’s Portrait of Dr. Gachet became the world’s most visible work of art, only to vanish from view–its whereabouts still a mystery.
The roller coaster ride to infamy started on a mild May evening back in 1990. At around 7:45, the rich, poignant likeness of Paul-Ferdinand Gachet–the Dutch Postimpressionist’s mediocre physician during the last months of his life–debuted in front of a packed salesroom at Christie’s auction house in New York. The bidding started at a respectable $20 million and rose swiftly in increments of $1 million, as if would-be buyers were proffering Monopoly money. 48 million, 49 million, 50 million . . . . The room erupted in shouts and applause; bidding was furious. 73 million, 74 million, 75 million . . . . The gavel finally came down, making art-world history. An unassuming Tokyo art dealer acquired Portrait of Dr. Gachet on behalf of an unknown client, for a total of $82.5 million ($75 million, plus a 10 percent buyer’s commission). The record auction price topped the previous champion, van Gogh’s Irises, by some $30 million.
The masterpiece went straight from the limelight into a foam-padded packing crate and was shipped to a top-secret storeroom somewhere in the Tokyo area. Gachet’s new owner, Japanese industrialist Ryoei Saito, spent a few hours with his purchase, then locked it in a climate-controlled vault. And there it stayed, untouched and unseen, for seven years–a symbol of the once highflying art market and the commodification of such works.
While the painting rested in its hiding place, Saito struggled, financially and otherwise. In 1993, he was charged with trying to bribe officials to allow the development of a golf course, which, ironically, was to be named Vincent. Wheelchairbound and broke, Saito pleaded guilty and received a three-year suspended sentence. During this time, he scandalized the art world by stating that he wanted van Gogh’s masterpiece cremated and buried with him upon his death–though he later said he was joking.
No one was laughing, however, after his death in 1996. It wasn’t clear who owned Gachet–Saito’s heirs, his company, or his creditors–or even where it was. Museum curators and auction houses tried to locate it. But while representatives of Saito’s company assured the world that it was still around, a veil of secrecy shrouded all future transactions. Gachet simply seemed to vanish into the murky waters of the international art market.
Sayonara, Japan. The sad, swirling Gachet, who wears what van Gogh called “the heartbroken expression of our time,” has almost certainly left Japan for a private collection. The person who owns it is just not interested in advertising the fact, most likely because of all the notoriety. But where is it? Some say New York, some France, some Switzerland. “People are just speculating on where the money is to buy it,” contends New York art dealer Richard Feigen, who nevertheless has his own theories about where it’s not. “If the painting came [to the United States], there would have to be people who knew–shippers, customs people. It couldn’t come in an unopened crate and go right into storage, like in Switzerland.”
Rumors still fly, says Cynthia Saltzman, author of the definitive book on the mystery, Portrait of Dr. Gachet: The Story of a van Gogh Masterpiece, Money, Politics, Collectors, Greed, and Loss. Still, all she’s tracked are dead ends. "[People] would say, ‘Oh, I heard it from this person in Japan who heard it from this person,’ " she explains. “It was often cyclical, and always just a rumor.”
Lost in all the gossip is why it’s important to return the painting to the public domain. Gachet is not merely the world’s most expensive painting; it is the culmination of the artist’s portraiture, says Sjraar van Heugten, head of collections at Amsterdam’s Van Gogh Museum. “He was trying to make a new kind of portrait, which would give a feeling of eternity to the person portrayed. These thoughts come together in Gachet.”
This is not the first time the masterpiece has disappeared. Van Gogh’s sister-in-law originally sold the work in 1897 for 300 francs (around $58). After several changes of hand, it found its way to Germany, acquired in 1911 by Frankfurt’s Städtische Galerie. The painting hung there until the spring of 1933–and the rise of Hitler–when the prescient museum director removed Gachet and several German Expressionist paintings and locked them in a hidden room. Not long after, the Nazis condemned such modern works as “degenerate art” and set about confiscating them; they finally tracked down Gachet in 1937. Within a year, party higher-up Hermann Goering–whom writer Saltzman calls “one of history’s most rapacious art thieves”–sold the work for some $53,000 to buy politically acceptable hunting tapestries. The painting soon changed hands again, ending up with the Kramarsky family in Amsterdam, who brought it along when they fled the Nazis and came to New York. They often lent the work to the Metropolitan Museum, and in 1990 put it up for auction.
Art-world insiders hope Gachet will resurface this time around, too. “Anybody would love to have it in their museum because it’s a great work,” says George Shackelford, chair of Art of Europe at the Museum of Fine Arts in Boston. He tried to locate the canvas for the current “Van Gogh: Face to Face” exhibit–and failed. “Let’s not be silly about it, either. The public fascination for the subject is so great that any museum would love to have the chance to use that fascination to get people to look hard at the painting as a work of art.” For now, however, all there is to contemplate is the money and the mystery.
Capitalize the incremental net income gained from visitors to the Louvre - security/insurance costs?
^ The price it would fetch at auction would be a massive multiple of the DCF to the Louve.
It’s actually uninsured currently because there is no value at which the Louve would be happy to see it replaced. It’s value is nearing infinity, as with most priceless things.
Seems to me that art is basically a commodity in the sense that it does not generate income and therefore prices resemble commodities like gold more than stocks, bonds, or real estate.
It is not like a commodity in the sense that one piece of art is not fully substitutable for any other. In that sense, art is more like real estate, minus the possibility of extracting rents. Actually, I suppose you could rent/lease it to a museum, so perhaps it does have some real-estate like qualities.
Art is likely to do well when the top end of society is doing well and competing with each other. For example, Jamie Diamond playing tennis in his living room with some original Jackson Pollock paintings is a good sign for art, because if it gets damaged, he’ll just buy a replacement, pushing demand higher.
He said value, not price.
There is status associated with it that I don’t think could be quantified any other way than selling it first.
Reminds me of a question in school… Professor asked methods of valuing a private business. Genius in the class responded, “Well, you could IPO it.” Sure, that would work…but then it wouldn’t be private anymore.
I wonder what the % difference in total price would be whole vs cut up, say in 4 pieces.
and would it make a difference if I cut it vs a famous artist to make a statement?
And the value is what price you can obtain plus personal enjoyment. Value cannot be < price.
I’d start the bidding at $25. I assume it comes with the frame?
$25 seems fair. It is a really small painting, after all.
And it’s only of 1 person.
Darn it! AF needs a LIKE button!
I say it has an intrinsic value of 50p…she’s butterz!
ha ha, that guy sounds hillarious.
Sucker! You can Google it for free…
nice post though