The passing of the Sotheby's whirlwind whipped up quite a wave of enthusiasm in the art market. Wide-eyed at by just how much the expected guide-line prices were surpassed, people were left with mixed feelings about the ever increasing price of paintings. What was good about it was that the auction stoked up what had previously been a sluggish art market; what was not so good was that with paintings becoming a short cut to making a quick buck for investors, the question was raised as to whether such speculative madness could eventually result in a collapse of prices.

Husband paints--wife holds up the price: Some people think that the first auction to be held by Sotheby's in Taiwan has produced a host of problems for the art market, among which the most obvious is that the activities of a so-called "second market" are coming out from under the table.

In other words, the "companies in the market"--artists, galleries, collectors--are "standing up" to secure their own prices and ensure their own profits. All they need to do is drive up the value of a painting by a particular artist at auction, and that artist's other works will be pulled up with it. Because of this, auctions are seeing clandestine price fixers at work, as well as people who are doing it quite brazenly. Pai Sheng-san of the Three Men gallery points out that with his own eyes he has seen the wives of artists holding up their placards to bid. Willington Lee of Galerie Elegance also frankly admits: "You prepare before you go into the auction. If the price of our artists is below the market level then we will bid to protect them."

The result of such fraudulent bidding is that a lot of paintings are sold at prices way above their true market value. This is especially true of paintings by older artists.

Ou San Jeng of the Impressions gallery uses his own estimate to indicate the big difference between prices at auction and market levels: the work of Li Shih-chiao gets about 80 percent more than its market level, and that of Chang Wan-chuan about 60 percent more. Art critic Ho Cheng-kuang says that in Taiwan many paintings have already surpassed world prices, and takes the selling price of NT$6.4 million for Liao Chi-chun's Turtle Mountain Island as an example. Even the modern masters of Paris and New York cannot surpass such prices!

And the works of some very highly-rated artists abroad, such as Chao Wu-chi or Chu Yuan-chih, fail to attract bids. Willington Lee thinks this is because they are still relatively unfamiliar in the Taiwan market, their paintings are few, and therefore their pulling power is comparatively low.

A bullish market in art?: The prices achieved by the Sotheby's auction have already become the new indicators of market values. One collector points out that before the auction the price of a small painting by Yang San-lang was NT$100,000; after the auction this was immediately adjusted to NT$150,000. What is strange is that this rise in prices has not been limited to this one-off frenzied shopping spree. At present it is difficult to buy even one painting by an older artist, while the young and middle-aged are also seeing a surge in prices. It seems that the galleries have reached a stage where there is no painting they cannot sell. Recently Chen A-fa sold all the paintings he exhibited in the East Gallery gallery; Wu Yung-chin's exhibition sold 39 out of 40 works before it had even opened.

"In the past you had to beg people to buy paintings and almost kowtow to them; today you are afraid in case anyone comes and poaches them," says East Gallery president, Liu Huan-hsien. "If collectors know that you have got paintings you cannot sell then they will turn away from you."

The art market is still bullish after the auction, but will it stay so profitable forever?

The supervisor of the Chuan Cheng Art Center, Chang I-chun, worries about the result of speculating in paintings just like stocks and shares. "The prices could collapse like the stock market. The final result of inflation must be a mad fall. When the whistle is blown and the fun is over, whoever is left holding the paintings will be the one who carries the loss."

There are also entrepreneurs who talk about the art market and optimistically stoke it up, seeming more like analysts talking about a bullish stock market. Some say that the people who are presently buying paintings are mostly middle class and that the really rich entrepreneurs have not yet begun investing, "so there is a possibility that the market will get even bigger." There are also people who think that the Taiwan art market is only just beginning and that the conditions for a collapse are not yet there: "Before the Japanese art market collapsed a small painting had risen to more than NT$4 million. Taiwan is still a great distance from that stage."

It is all only just beginning!: In fact Sotheby's has certainly not been the instigator of the inflation of the art market here, but can at most be said to have added fuel to the fire. Pai Sheng-san thinks that Taiwan's experience of auctions has just begun and it would be hard to avoid some unreasonable phenomena. All that is needed is longer and more intensive auctions, then the market will increasingly get onto the right track and human factors will become less and less.

"One or two paintings and people can speculate. When you get to tens or hundreds of works, then who can bid?" says art critic Ho Cheng-kuang. He also thinks that you cannot make a judgement after just one auction and that when more have been held then things that cannot stand up to scrutiny will naturally be eliminated. Just as Ou San Jeng says: "It is all only just beginning!"

Is that not so? It is all only just beginning. A society that values "art" can never be expected to be attained on the wealth of a generation. With all the fun of the stock market craze having faded away, art auctions have become the new darling of the investor. It seems that society's nouveau riche speculators, no matter whether studying how to live with money or how to live with art, are all just beginning.

[Picture Caption]

To satisfy the demands of their clients galleries are becoming more and more like sundry stores where if you want something then they will have it.(photo by Huang Lili)