OCT 2014: HOW FULL THE GLASS

What is going on? Just about everything. A complex situation in the Middle East, a potential pandemic in Africa making its way to our shores, a property bubble emerging in China which is potentially a house of cards, a deflating property bubble in London, Eastern European tensions, North African tensions, social media depriving governments of control measures, traditional news channels becoming irrelevant, the political structure of the United Kingdom in flux…..etc.

With this background which is a kind of Armageddon it has been business as usual here in Blighty. Whoops, are we allowed to say Blighty any longer after the Scots nearly cut themselves adrift. I had predicted in an earlier missive that the Scots would jump ship and it was closer than most expected and the panic was manifest resulting in many long grass promises. Now the phoney war has broken out between the parties as they limber up for the election next year, all wondering how to deal with borrowings which continue to rise by £100bn+ p.a..

Markets were taking little notice, drifting within their recent ranges. The growth rate in the UK is trumpeted as the best of the developed economies at 2.7% expected for this year. The pound against the Euro and the US $ is at high rates. Is this the calm before the storm or is the trend our friend? Well, markets seemed to wake up overnight and suddenly there is a run for the hills. In a world where concentration spans are down to 3 minutes and Radio 4’s Today Programme has become a chat show, where can you get good analysis. No hope really, as no-one can accurately predict where we are headed in this maelstrom. I can only recommend you discover Radio 4 Extra where you will be able to bury your head in the finest repeats of a simpler pre-pc world---- Tony Hancock, Spike Milligan, Round the Horne etc.. Brilliant!!

In the art and antiques world things are buzzing; possibly a consequence of the devaluation of money and the lack of trust in the old norms. Things are in. Why else would Stanley Gibbons pay £8.6m for the dealer Mallet which two years ago was deeply in the red. Stanley Gibbons now owns Dreweatts, Bloomsbury, Baldwin’s and Apex. Someone thinks the market just beneath the top two auctioneers has a good future or at least that auctioneering in all its forms is a money spinner. Bonhams has invested millions in its Bond Street venue. And what do you make of the latest development from Christie’s? Having increased “buyer’s” premiums to record levels, a misnomer as there must be a consequential depression of the hammer price effectively borne by the seller, Christie’s have announced what amounts to a success fee to the seller. Seller’s commission is between 10-15% on lots up to £60k, and somewhere between 2-8% above that and once the lot price goes stratospheric there is no commission. Of course it is an illusion as the hammer price takes the buyer’s commission into account. However, now sellers will pay an extra 2% fee if the lot achieves its upper estimate, a success fee based upon the auctioneers’ view of the estimate. Could this lead to estimates dropping? Interesting. That is not all, in the cyberworld, Paypal is splitting from Ebay and online only auctions proliferate even amongst the top houses. Buying things unseen has become normal. The bricks and mortar auction houses’ days must be numbered just like supermarkets. Change change change everywhere.

A pretty dull year for tavern clocks as there has been only one special clock auctioned and another which would have provided some excitement was withdrawn after a public uproar at its removal from the hotel in which it had hung for as long as drinkers could remember. In this lull, Tavernicus is busy updating the book “The Tavern Clock” as change is in the air.

Meanwhile more news for Spitfire lovers, (reported here from time to time). These machines are now over 70 years old, but for the man who has everything including a PPL and a huge wodge you can pick one up that needs work for about £2-3m or indeed have a completely new airframe made at Duxford. A 27 litre Rolls Royce Merlin engine will set you back £170,000 and every 200 hours another £120,000. Oh and there is fuel at up to 90 gallons per hour. Bless!

JULY 14: MASTERPIECES

The June Masterpiece Fair was a blockbuster for antique clocks. With the uncoupling of two major dealers there were five important displays of the best of the best; Carter Marsh, Raffety, Howard Walwyn, Anthony Woodburn, and Ben Wright. There cannot be a finer assembly of important horology for sale anywhere in the world than at this fair. There were five tavern clocks on offer with prices ranging from £20-48k. In no particular order; an early shield dial by Gabril Holland, the smallest white round dial on record by Ralph Glover, the only recorded chain driven 8 day white round dial with bezel by Abraham Bernard now in the UK from the USA, a white round dial by Thomas Green and a smallish white round dial by Chas. Penny. All of these clocks were already known to Tavernicus.

The fair is clearly the market leader and although there was no major gimmickry this year i.e. no Spitfire at £8m, no classic cars, no scrap metal aircraft tables etc there was lots of bling for the overseas punters. Jewellery everywhere. For the serious art collector there were paintings priced in the millions; a Rene Magritte green apple with a table on it, a mere £3.5m, the same for a Lowry stick men painting. Restaurants galore, all from the same stable, Le Caprice, the Ivy, Scotts and so on. All aimed at the very top of the market and beautifully executed. It is worth reflecting on the fact that this fair was only born because the Grosvenor House Fair gave up its pre-eminent status. I wonder if they rue the day as its replacement is in a totally new class and there is no way back.

Other musings; the internet continues its inexorable rise. The saleroom-com the leading source of online antiques information and the bidding service reports that visits to its site are up by 80% and that each month they are getting 0.5 million visits. How long will it be before the Antiques Trade Gazette, a sister enterprise will go all electronic? Live bidding accounts for 27% of lots sold with 650 auction firms now uploading their catalogues for live bidding. The digital camera has made this possible. If you visit an auction room you will find them relatively empty and this will continue as a trend. There are now online only antique auction sites springing up. Where will we be in 5 years’ time; well the trend is your friend.

Meanwhile the major houses go from strength to strength but they are keeping all their options open. Bonham’s which has spent millions on its London operation is rumoured to be for sale or on someone’s radar at least. Christies and Sotheby’s strengthen their Asia operations, take on the trade with direct sales as well as auctions and are dipping their toes into online only auctions. They are ready whichever way the trend goes. The contemporary art market still fuels the engine of growth. In one week in May in New York $1.57bn of sales went under the hammer compared with the previous high of $1.34bn, with Christies setting an auction record of $745m in one session with bidders coming from 35 countries. Notwithstanding the trouble that guarantees have caused auctioneers in the past, Christies gave sellers 33 guarantees as to the price to be achieved. Sotheby’s sales were not in the same league by value perhaps because of board room diversion whilst they deal with shareholder activism, but still in excess of $330m in one sale.

In my next blog I shall write about the art detective on the net. A good summer to you all, time for a glass of rosé methinks.

FEB 14: FORM OR SUBSTANCE: THE PARADOX

Davos, Jay Rayner, Russell Brand, hybrid vehicles, wind farms, curling, anyone claiming   to be an expert, sous vide, special advisors, chuggers, businesses masquerading as charities etc.. What are they for; no idea. Glad we got that out of the way. They all have form but what about substance?

The Antique Furniture Index, AFI, has both form and substance as it has been measuring the value of antique furniture since 1968 and is the best guide to what is happening in the trade; or is it?

Just published in the Antique Collectors’ Club magazine, the AFI reveals another awful year for the furniture categories it measures. The indicators in 2012 suggested the worst may be over but in 2013 all seven categories declined in value with the average fall being 6%. The result is that the index is now at the same level as the late 1980’s.

What is going on? 2013 was a record year for Christies with turnover up by 16% at £4.5bn. Sothebys are having a positive year with turnover up by 5% in 9 months. Both houses are seeing major growth in private sales which were $1bn for Sothebys in the 9 months. Poachers and game keepers under the same roof! Contemporary and modern art continue to drive sales as does Asia and new money generally. The big boys are immune to what used to drive the antique business. In fact the big two are more or less out of the traditional business as they close departments and restrict their minimum lot values, together with ever rising buyers’ premiums. 

It might be expected that the regional auction trade would be dying based on the AFI; not a bit of it. The main players including Woolley & Wallis,  Dreweatts, Tennants, Fellows and Sworders to name a few all report healthy rises in sales. These companies benefit to some extent by the withdrawal of the big boys from their turf in favour of mega ticket items. Internet live bidding must be a saviour.

The lower end of the trade must be in terminal decline as the best lots evade them and ebay diverts lots to private sales.

So who is really affected by the implications of the AFI. The answer must be nearly all of us as the prized possessions handed down over the generations reach negligible value. Collections may no longer justify restoration other than for sentimental reasons.

The substance of the AFI is not what it tells us but what it does not. As to the others in my list …………