Friday, November 17, 2017
Intrinsic Value
What is a painting worth? The materials that go into one cost a few dollars. The labor cost of the painter is gauged by demand for his work. Most do poorly or barely make a living. But in the secondary market, long after they are gone, hype can increase a canvas' value many thousands of times.. Thus the Leonardo Da Vinci Salvator Mundi sold for $450 million. The art world has been shaken by the extraordinary amount. It was achieved through clever marketing by Christie, the auction house. Will the buyer ever recover his money if he goes to resell the painting someday? There is no way of knowing, but one should not be surprised if he doesn't. Values rise and fall with market sentiment. There are times not to put a work up for bid and other moments when the fever is at a new high. There is no way to program a machine to forecast accurately what a painting might bring. The same is true for other markets like real estate. Value is what one is willing to pay. Time will tell whether the buyer of the Leonardo paid too much.
Comments:
Post a Comment