The 2008 fall season for Canadian art could well be the most successful on record – if the global downturn in the economy doesn’t get in the way. Or, put another way, the country’s major salesrooms have put together a very strong fall offering which, even as recently as six months ago, would have challenged the record for the best season ever. But with the massive uncertainty circulating world investment markets at this time, and the already waning interest in international auction markets, who knows what’s going to happen in Canada this fall.
Internationally we’re getting mixed reports with some sales exceeding expectations, and others, particularly in the contemporary markets, falling well below par. However, the deeper we get into the economic abyss the more disconcerting the news becomes. Sotheby’s saw their November modern and contemporary art sale in New York sputter with 35% of the works unsold in a session that produced US $224 million against expectations of US $338/475 million. Weak sales in Hong Kong and London have also sent shivers through the art community as the major rooms scramble to adjust estimates and reduce exposure through guarantees.
Will the Canadian market follow suit or can it remain immune from the international economic turmoil? In the past, significant economic downturns have affected the art market quite dramatically here in Canada, with, once again the more modern, abstract markets taking the first and steepest tumble and taking the longest to recover. Is history about to repeat itself?
Perhaps not. Traditionally the art market has often been as much as six months behind other investment markets when it comes to reacting to economic pressures, so, if form stays true, we might expect this fall season in Canada to be strong, and perhaps even set a new season record. And if the season is positive it is more than likely that most of the strength will come from the top end of the market. The lower end of the market, which was the most active in the 2007/2008 year, will likely stall somewhat and could even slip back a little, while the extreme low end – under $1000 – might really be facing an uphill battle.
But history doesn’t always run true. If it did the Canadian art market would not have posted its 12th consecutive annual total sales gain this past year. Indeed, it wouldn’t have posted a 7th gain, let alone 12, so we cannot put too much faith in historical precedent, particularly in light of the severity of current market conditions.
All we can do is wait and see what transpires. The auction houses have done their part and provided the market with an excellent selection of works. Now it’s up to the buyers. Will they turn to the art market for some protection for their investment funds, as they have done in the past, or will they favour the old adage that “cash is king” and sit on their hands when the items go on the block? We’ll know soon enough as the first sale of the season gets underway in a week’s time.