This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

The Digital Skeptic: What If the Art Market Was the Model for All Markets?

Unlike financial markets, art markets work.
Here comes the digital-age investor big think: In spite of this wanton violation of every supposed bedrock notion of modern narrative-based digital asset pricing and exchange -- where more disclosure, more information and, geez, more trading is seen as a positive -- the process of selling art, as out of date as it appears, is as good as it gets when it comes to trading in this collapsing digital age.

"Everyone makes money," Lelong-Mainaud told me with a wink. "I will always be doing this."

A quick look around shows the source of her optimism. Yes, parts of the art market are soft. Sotheby's, for example, saw total revenues drop by 8% for 2012, year over year. But plenty of art trading is stout. So-called private trading in art, which essentially happens away from public auction, grew by about 10%. And the blockbuster deals just keep coming. Sotheby's recently sold a medium-level 18th century Italian masterwork, Susanna and the Elders, for $11.4 million, exceeding the pre-sale estimate by roughly 20%.

Good luck trying to match this sense of prosperity in the art market with the larger modern financial markets.

The hallowed New York Stock Exchange is suffering the indignity of being sold to a discount trading outfit called ICE, based in Atlanta for heaven's sake. Whispers swirl that the equally storied Chicago Board Options Exchange is on the block. And the mold of bearishness is even wafting out of high-tech markets like the Nasdaq OMX Group.

"Since decimalization and new market regulations effectively squeezed the margins -- and the potential for graft -- out of the system during the last decade," wrote David Weidner over at MarketWatch, "the business of running a stock-trading marketplace became a sideline."
2 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
BID $44.45 0.54%
AAPL $125.69 -0.25%
FB $87.22 -0.38%
GOOG $525.02 0.41%
TSLA $267.88 -4.23%

Markets

DOW 17,776.91 +93.33 0.53%
S&P 500 2,081.34 +12.58 0.61%
NASDAQ 4,997.4590 +5.5190 0.11%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs