HN Reader

I'm amazed that the article doesn't discuss the end of ZIRP. The bursting of the art market bubble in mid 2022 coincides exactly with when interest rates started rising following the 'transitory' inflation caused by pandemic relief measures. This was also the same time that we started seeing hiring freezes in tech, the bursting of the luxury watch bubble, etc. It's all tied together, and has the same root cause: It stopped being cheap to borrow money, and it started being lucrative to lend it out for guaranteed returns (e.g. by buying Treasuries) rather than speculating on artworks, or NFTs, or whatever.

The art world is just fine. Pretentious art speculation maybe not so much.

In a way, we are actually in a golden age. I lurk on social media accounts of amateur art enthusiasts around the globe with (IMHO) good taste who seek out interesting little known artists and post it on their feeds. I am introduced to so much great art that I probably would have never known about otherwise. If I see something I like, I search for the artist online and see if they have something available in their portfolio for sale that I love.

I’ve bought amazing art from talented artists around the globe that speak no common language with me. We get it done (Google Translate to the rescue). I don’t filter on price but virtually everything I’ve bought is always in a couple hundred dollars to a couple thousand dollars range. The fact that you can talk to the artist just adds to the story.

Forget the “tastemakers” in art. I can give my money to excellent artists directly, including many that never attracted the attention of tastemakers or who weren’t deemed worthy by said people. I received a huge piece from Denmark today. The whole experience is lovely and the artists really appreciate that someone loves their work. This is the future.

This is really the art as speculation fad coming home to roost. The people actually interested in art as art are now on things like Instagram buying direct from the artists with very little gatekeeping either by art schools or galleries.

It would be tempting to see if there is a correlation in when the “legit” art world price going off a cliff and the NFT bubble, because that suckered in a lot of the idiot end of the speculator crowd.

The best evidence that art was going to crash is when Masterworks ads were everywhere. You know the bubble is stretched to its limit when they start hawking it to retail.

"I've got an exciting bag-holding opportunity that you don't want to miss."

How much of this is due to anti-money laundering regulations enacted in the early 2020s [0], which much better vet the identities of the buyers/sellers?

[0] https://www.lseg.com/en/risk-intelligence/financial-crime-ri...

I make an unusual kind of art, but I haven't tried selling it, as you need a stable of interested people, and I can only post it in one place at the moment (a Facebook interest group on tiling, Instagram is overrun with AI, you can't start a new profile without lots of existing supporters). I've considered opening a gallery in my local area just to sell my art (5 million people in the metro, and barely a real commercial art gallery). My overhead would be just me and a location. The idea of selling art for tens or hundreds of thousands seems nuts.

I do see that there are too many galleries in places, selling too many artists, to too many people, with massive overhead (in the story, the gallery had $100k+ a month in expenses). Also, it's hard to make something new that is still saleable, almost every kind of art is basically something people did 50 or even 100 years ago; I look at art people are selling all the time, and most is not anything different. The best stuff is from people that hardly anyone knows, who like me just make something different because they want to.

I'd love to sell it online, but without an audience, no one will visit. I could sell it at https://www.saatchiart.com, but they don't really market most of what they have. You have to drag people there. Plus they take 30% or 40% (50% is normal for galleries). Locally, in the right location, people see your art, and stop by. It's just the pain of setting it up, and then sitting there while you wait!

Mentioned it here before, https://andrewwulf.com if interested.

As mentioned by others, I think the art world has reached a major schism where there are two types of artists: those who target rich collectors and those who are more grassroots. I've been to a lot of the larger art shows in the US and it's always amazing to me how expensive so many of the pieces are. I couldn't even justify buying a cheaper piece I want on a software engineer's salary. Instead, I've found that local art fairs have been where so much of the growth is at. Things like Cherry Creek Art festival or the myriad of smaller markets around, you can find amazing artists selling interesting and beautiful works. Between markets and social media, there's a path to being a sustainable, working artist. And personally, I think being a collector of smaller artist's prints and works is more fun than the expensive ones!

The vanity of owning rare things is all too much... NFTs are really the culmination of the phenomenon. I'm all for owning beautiful things and paying if it's something handmade. But once it becomes such an extreme out of wack status symbol kept alive by a global elite it's just feeding the monster. The worst is when it's an expensive status symbol and still mass produced I suppose

As I understand it, much of the art market is based around the ability to purchase a "valuable" piece of art on the private markets let it appreciate then "donate" it to a museum or non-profit for a lucrative tax write off. At least thats the hustle as I understand it. I could totally see that in jeopardy based on liquidity and the markets.

> My former Artnet colleague Tim Schneider’s analysis at the time of the deal revealed that the gallery was on the hook for $704,000 in monthly rent, or $8.5 million a year—$220 million over the course of the lease

Seems like it’s not an art problem but an art dealer problem. If you rent a $100k/month restaurant space that seats 20 people, is the food industry dying if you can’t turn a profit and close?

My sister started an independent artist career from 2022, and overall trends were fairly brutal to her (unemployment due to Russian-Ukrainian war, raise of AIs, tariff war), however the only solution in this circumstances is to climb up, raise the quality of one's art and aim for the higher price range.

I’ve been trying to break into the art market as a complete outsider for the last year and a half (doing mathy lenticular holograms). What I have seen has stunned me - the level of groupthink and copying whatever the popular trends are and making up pretentious language to sound sophisticated is wild. And often the actual art is just ugly.

I have found that the higher priced galleries seem to sell worse art. The emperor has no clothes. And just like the Impressionists revolted against the Academy, us artist shall revolt at the Art market system that says “your work only matters if you have an MFA from a top school”.

> Major collectors have stopped buying art or significantly reduced their spending. The next generation isn’t there to take over from the old guard.

Just one example, one of the biggest Canadian collectors of contemporary art is condo marketer Bob Rennie, who during the foreign wealth lead boom in Canadian real estate, was making so much money that he opened up an entire personal downtown museum to show off his art works.

After layers of regulation against foreign buying amongst many other shifts in the economy (hi interest rates), condo sales are now in retreat with developers on the ropes and Rennie Marketing laying off staff.

Things change.

(I have no idea if Rennie has stopped buying, but given the sorts of big shifts in his industry, I wouldn't be surprised if he'd eased off!)

I've purchased plenty of art over the past couple years, mostly original paintings with a few prints. Very few of those came from galleries and when I walked in the galleries, I already knew what I wanted to buy.

Etsy and reddit are easy ways to find rather good art for what I can tell is a consistent price based on the size of the piece.

The only time I 'browse' art offline is during special events, which have all been wander from house to house or small art studio to studio. I love the experience, it's much more personal as you know the artist will be there and you can discuss the piece with them.

My brother is an up and coming artist in his field and has had many pieces bought by a billionaire that collects art extensively and has an amazing world-renowned collection. The billionaire has stopped buying art this year. Not just from my brother but stopped buying art completely. And there are many others like that that have stopped buying. That’s one canary in the coal mine to add to my collection that something bad is likely coming. The rich always know first. I’m just hoping we can make it until 2026.

There are people who think the art world isn't 10% fools and 90% money laundering?

Just go to the smaller/community art shows and you can usually find a couple or five really excellent artists who put their life into their work and will talk to you one on one vs these high priced pompous ego exhibitions like Art Basel.

> Each case is different, but many voice the same laments: Overheads are killing businesses. Sales are down. It’s no longer fun. Primary pricing is untenable. Major collectors have stopped buying art or significantly reduced their spending. The next generation isn’t there to take over from the old guard. The art world has become bloated, and there isn’t an easy way to cure the malaise.

> “I don’t believe for one second that it’s cyclical,” Belgian collector and art market commentator Alain Servais told me. “It’s structural. The infrastructure is too big. There are too many advisors, too many galleries, too many artists, too many fairs. Everything will need to downsize. In my blunt opinion, blood will flow in the streets before the art market finds a new balance.”

Super exciting to imagine what new structures and ways of making and sharing art might arise in the aftermath of this system. It seems like in a lot of ways the gallery / collector relationship is still running essentially the same way that was established in the 1870s.

Seems like a low interest rate phenomenon

> Now that the bubble has burst, the speculators are out of the picture, off flipping meme coins, where no one makes them feel inadequate or insists that they buy three things they don’t want to get the one thing they do.

> “The juice has got to be worth the squeeze,” one collector-trader said. “And there’s no juice in the art market. It’s just squeeze, squeeze, squeeze. Rude, rude, rude.”

From what little I know of the NY art scene, by osmosis (by having an SO who previously was accomplished in it, and could mingle well at gallery openings and cocktail parties, infinitely better than I could ever learn to)...

I wonder whether the "rude, rude, rude" means that the market had come to depend on nouveau riche speculators (who'd typically have neither the intellectual and artistic background, nor old-money social graces/conventions).

If you didn't respect your customers, and didn't make them feel valued, then the ones who only cared about money or status games have other options.

Isn’t the money being invested in crypto instead? Rich people might prefer others better ways to protect their assets than the current art market

> The question is how to “get people to understand that art isn’t an asset class,” Schwartzmann added. “That’s not how you should be collecting,”

> Valentine said ... "Asking $20,000 for a work in an artist’s first show is unsustainable"

none of the separate participants in this article are willing to acknowledge that these are related problems.

there is no price discovery in the art world, and it was only just beginning to happen in the pandemic era flush with cash

when you question the price or try to find any rational trend, the gallery director gaslights you into the prior quote "you should just love the piece!" okay but why should I love it at this price "because it will be another price in the future!" but why will it be another price who sets that price "we the gallery do! it moves up over time!" how does that work "you should just love the piece!"

The market for High Horology (vs. mass market watches like Rolex) hit high water marks the past couple of years. F.P. Journe, for example, released a (Quartz!) watch, the Elegante that retails for $12k and sells on the secondary market for $100k. Maybe rich buyers moved on to celebrating a different type of artist.

This article is part of a broader market report with more figures: https://news.artnet.com/market/mid-year-review-2025-2684554

How much is crypto currency to blame? Art has traditionally been a means to launder cash and evade taxes. The scarcity is what allows for this. Crypto is manufactured scarcity. Why go through the bother of buying and storing art when you can just buy crypto?

Yeah if an artists needs to pay 50k rent + 50k staffing to show of their works something is wrong

> The gallery had made international stars of artists like Harold Ancart, Korakrit Arunanondchai, and, more recently, Marguerite Humeau

I'll be blunt. I've looked at their works, and those in the article itself.

I won't be losing any sleep over this.

when covid happened gold prices, crypto and art prices went through the roof; now that the covid situation appears under control and markets have returned back to normal, everything is predictable again - it makes sense that art markets are taking a steep decline back to normal levels. Being able to hide assets during a time of //war/plague/market crash/comet strike etc// is a skill which will make a man great wealth if he offers the service to whoever is rich and still alive. It therefore seems logical that art markets and shows can mothball themselves for the time being.

That Kristina Reischl image looks a lot like stone toss comics for some reason

Self inflicted. Both artists and the galleries representing them became too greedy. I have acquaintances who rather starve than accept their work is not worth 10K a piece.

My city has a medium size art gallery. Every couple of years, the curators will hold their nose and run an exhibit by "dead white males": figurative painters like Rembrandt. The gallery becomes packed with people. Afterward the curators go back to their usual fare of "Iranian-American textile artists" or whatever; the gallery sees no visitors for months.

Bleeding money, the gallery recently laid off half their staff.

It's almost as if the curators would rather lose their jobs than exhibit art that the public enjoys.

The digital revolution is disrupting the art world, both for better and worse. It's fascinating to see how artists adapt.

The art world at large? Or the traditional business environment of pretentious art hucksters?

I just want to know the bottom line: is this good, bad or indifferent for the actual struggling artists. Or upside for some, downside for others? And, which struggling arists; how many out of the multitude associated with what outcome?

    while its costs (for operating two spaces, in New York and Los Angeles) remained unchanged, about $150,000 a month.

I mean... That's pretty insane. It's not hard to imagine why this business model might not work...

Good riddance. Collecting art is yet another way for the ultra rich to avoid taxation. It's a complete and utter farce.

From the outside, so much of the art world looks like grifting and fraud. (Much like the NFT scene)

Good riddance.

Anything worthy of the concept of art isn't likely to be found in these places.

If you like making shit that looks cool and you want to sell it, have at it. Just please drop the intellectual pretence that anything other than "it looks cool" is going on.

> The question is how to “get people to understand that art isn’t an asset class,” he added.

Got to love 'late stage capitalism'

One need to look at it from view point of the buyers. Who are these buyers? Someone who has lots of floating money, not concerned about future of his people or country or economy, having completely predictable life routine and not too busy at work. And most importantly someone who is nostalgic about old times and old things and who can sense and admire the human effort that goes into art.

That species of humans is getting extinct or do not have control of their investment decisions anymore. Someone who was born in the 70's and later is likely to be less interested in collectible than someone who was born in the 50's.

Another big problem is, the buyer now has hard time in sensing the raw human talent that went into the art vs the machine output. If it is a sculpture, we can't know whether it is 3d-printed. In old-times this trust issue wasn't there. It was raw human skill at display.

I keep telling this story from pancha-tantra the folk-lore tales from India. Friends walking in a forest, come across a dead tiger. Having great skills in different branches of science, they decided to test their skills to bring the tiger back to life. Sure, it worked, but before they could celebrate, they were attacked by the tiger.

> Another revealing indicator: Soho Art Materials, a popular art-supplies company in New York that works with artists and galleries, traces the sector’s decline to the summer of 2022. The firm’s sales began falling gradually and then in June 2023 dropped 20 percent from the previous month, according to Jonathan Siegel, a co-owner. The company was stretching 700 to 1,000 canvases annually for three years, starting in 2020; it now does about 200 a year, he said.

It might be a stretch, but Dall-E 2 came out in April 2022.