Vanity capital, or “my Giacometti is bigger than your Giacometti”

Posted: 4 May 2015 in Uncategorized
Tags: , , , ,

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Apparently, Bank of America Merrill Lynch has dubbed a new asset class Vanity Capital, which relates to lifestyle and identity-related purchases. It’s equivalent to the world’s fourth largest economy.

Here is how that spending is distributed globally:

vanity_spending_by_region_market_size_chartbuilder-2

As Harry Wallop explains,

Lot 25 in the Christie’s auction, Looking Forward to the Past, in New York next month is likely to excite a lot of interest for one simple reason, and it’s not its historical significance nor even the universal fame of its creator. It’s all about the price tag.

Picasso’s Les Femmes d’Alger (Version “O”), painted in 1955 in homage to Matisse, is expected to break the $142 million (£95.3 million) record for a painting sold at auction when it goes under the hammer. If so, it will confirm that the top end of the art market has gone completely crazy.

The week before, Sotheby’s will sell Van Gogh’s L’allée des Alyscamps with an estimate of $40 million, and Roy Lichtenstein’s The Ring (Engagement) with an estimate of $50 million.

“The prices of so many of these artworks are disproportionate to their art historical importance,” says Josh Spero, the editor of Spear’s, a magazine that caters to the yachtowning, Picasso-aspiring classes. “It’s all about ‘my Giacometti is bigger than your Giacometti’ now. Will you really get $140 million worth of pleasure from it? I doubt it. But you know you had to outbid three US hedge fund managers and a Russian oligarch to secure it.”

Bank of America Merrill Lynch may be trying to capitalize on the spectacular growth of the market in vanity goods in the Second Gilded Age. But, if remember our Thorstein Veblen, there’s certainly nothing new about the conspicuous consumption of the leisure class.

Comments
  1. BRF says:

    really quite disgusting when you think about how crass and anti social this is.

  2. […] Clearly, the ever-expanding bubble in high-end art is predicated on the extraordinary amount of surplus that is being captured by a tiny number of individuals at the very top of the world’s distribution of income and their willingness to spend a portion of it on “vanity capital.” […]

  3. […] Clearly, the ever-expanding bubble in high-end art is predicated on the extraordinary amount of surplus that is being captured by a tiny number of individuals at the very top of the world’s distribution of income and their willingness to spend a portion of it on “vanity capital.” […]

  4. […] opine on art (the Chinese vanity capital market is booming this […]

  5. It’s actually a great and useful piece of info.

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