Heard it a few times and it certainly seems like something that would happen but is there any proof or real world examples?
Can an Appraiser just make something worth $20m based purely on their say so?
EDIT: Thanks some great replies! and yeah i was asking more about the tax evasion part than the 'modern art is bad lol' angle.
Made a new account because I work in the industry. Aspects of this meme are true but generally it's not this blatant. The blue-chip art market is pretty financialized, and scams between dealers and buyers definitely exist that auction houses are all too happy to facilitate, but it's a bit more complex than this. I also take exception to the punchline that abstract or non-figurative art is a result of grift, because that's just hugely incorrect, but maybe I'll save that for another post.
High level collectors will donate works to museums and institutions and they will usually get a tax write off for that, but generally you have to have had the work in your possession for a few years before it counts, so guys buy things and store them for a few years. Museums and institutions actually generally don't want donations, since they already have their own problems with inventory and generally can't afford the riders that a lot of these donations come with ("I'll give you my collection of 10 paintings if you agree to have them on permanent display with my name on it") so quite often they'll tell you to fuck off. If you buy a work with the aim of a tax write off, generally you've already worked out a deal with the institution and it's probably something of existing historical import that they'll want.
A bigger issue with the contemporary art market is the relationship between dealers, their artists, collectors and auction houses. If you buy the hot new artist from one of the huge galleries - Zwirner, Gagosian - or the next tier or two down, you'll likely sign an agreement to not offer any work at auction for X years, or that you'll buy one and buy another to donate, mostly with the aim of inflated desirability and limiting supply. Often those agreements are informal by design, so new works enter the market come with maximum hype. "Wet" paintings entering at auction is a term you'll hear for any new painting that was recently finished, bought, and reoffered. There's a huge issue with middling new painting ("zombie formalism" and now "zombie figuration") flooding the market and getting outrageous prices on the back of speculation and flipping, but part of this at least can be explained with dumb new money - tech bros, oligarchs, etc. - and bad art advisors.
The most inaccurate thing about the above is an inflated valuation by an appraiser. Appraisal values are based on sales records, and since those are basically public so most of the grift comes from trying to juice the sales market directly.
Anyways. As I was typing this @solaranus also covered some of it, so I'll leave it there. The important thing is that artists usually get the short end of this stick and won't see anything after the initial sale. We're seeing a shift in the secondary market with artists' resale rights being built into contracts or buyers premiums, so that for each resale the artist will get a small percentage cut - but at the moment it's just huge artists like Richter who can get away with adding that, or smaller auction houses, so there's still a ways to go.
Some real formal talents that just got immediately turned into commodities. Like you're never going to really develop your practice when you're painting 16 colourway of Mickey Mouse or whatever because that's what your dealer decided your next show is going to be. Just brutal.
Oh one more thing that might be interesting to know is the "irrevocable bid," which came into existence at auction houses after 2008. Basically a lot will come to market with a little star next to it saying a third party has already put down a particular bid for the work which would guarantee the sale, with an agreement that they'll get a cut of whatever the final hammer price is if someone else ends up winning. In practice, this means that the third party has already bought the work for their price, and the auction is just for show. It's a way for auction houses to secure better inventory from consignors ("we already have a buyer"), and allows buyers to avoid the hassle of bidding, all while putting on the theatre that this is a legit auction. Basically everyone hates it because it obfuscates everything, artificially inflates the market in a super obvious way, and is kinda dumb.
I've seen enough students bullshit their way through getting their work graded by the prof that I know most of them aren't being totally honest when they produce work for others. Some of the most amazing artists I'd ever met didn't actually sell the things they liked making, despite being very skilled, and the ones who only made stuff that they liked tended to not get very far financially unless it just happened to catch someone's interest in the same way a new meme takes off. I'm not super into mainstream art because of that. I think the symbolism is more likely to be dishonest or performative and designed to keep the person from having to have a second job (which is fair in itself but capitalism sucks the soul out of everything).
And it's silly because I love online places like deviantart (with content filters on, mind) or mastoart. You get to see a huge breadth of people who aren't upper-echelons-of-society-skilled, or are fairly skilled but not plugged in to the high art world. I think this gives their work a 'proletarian' character, and it's kind of neat that we live in a time where your average prole can just make and distribute art without necessarily having to be commissioned. Sure, a lot of it is derivative in theme and content, but I like seeing people drawing what they want to draw, and it makes me wish I had a little more money to give to some small time artists or students.
And it’s silly because I love online places like deviantart (with content filters on, mind)
Is DeviantArt really DeviantArt without the inflation and /d/orses? Honestly, I love seeing that kind of niche stuff. Not my bag, but it's interesting seeing such a wide range of human interest and expression.
EDIT: a word
Someone I know was hired to do art sales at Sotheby's. They were extremely overworked, asked to do questionably legal things, and when they finally gave two weeks notice, were offered a promotion to dissuade them from leaving.
Hearing this situation, and they stories they would tell me made me think hard about how fishy the whole thing.
What I've heard is, after you get rich, you very rapidly run out of things to buy. You got the vacation houses, you got the cars you always wanted, the boat, the vacations, etc. What's left? Art, that's what. It's a tremendous money sink and you get to show off in front of other rich people.
I feel like artists bear a lot of the blame. They got a divorce from us a long time ago and never regretted it. They ascended into an ivory tower and love their lives far away from the great unwashed. One can only expect a negative reaction from one spurned so harshly.
what are you on about anybody can be an artist and the great majority of them are poor.
"Putting a bunch of random shit next to a soy wojak and seeing who gets mad"
Is Jacob a comrade? Only seen a couple random recommended videos of his but I just get a vibe
Yea, he’s come out a few times and said some explicitly leftist stuff. Idk what flavor of leftist he is but he seems to at least be some type of socialist
A lot of people don't realize that the d-word has equal if not more genocidal backing than the n-word does. Probably because the word has become more normalized within fascist (read: meme) circles.
Almost every meme circle has direct ties to neo-nazis. It's all a big grooming scheme.
Get people to laugh, make them want to fit in, then hit them with the Jewish Question.
My take is that comedy has deep ties to the far right but it doesn't inherently have to.
Maybe, lefty memes have been doing a number on their stranglehold. Sadly as long as liberals remain in majority control (they're propping them up) those communities are here to stay.
There's a reason why looking up your favorite meme on google gets you literal Nazi shit, and it isn't because the Nazi memes are more popular.
So… 5-10 more years tops, or forever if Gen X starts uploading their brains to the internet or some slag like that.
I mean its more like theres a money laundering scheme around modern art, someone is always gonna be sitting around doing weird textural paintings either way or doing wacky conceptual shit.
Tax avoidance is the big one.
Example: Rich guy buys art pieces every year which he never sells. He has them appraised every tax season until he finds one that is now 50-100x the price he bought it for. He then donates a few art pieces to various charities (maybe even one linked to his family). He has now maxed his federal/state/city/metro tax breaks without actually ever selling anything. Neat trick huh?
https://web.archive.org/web/20170225073516/https://www.nytimes.com/2017/02/19/arts/design/has-the-art-market-become-an-unwitting-partner-in-crime.html
Yes, art is often overpaid for as long as you're friends with a rich person. Yes, that art being owned by a rich person makes it more valuable, which lets them write off more tax, so yay.
But also no, a streak on a canvas can very much be real art, (but, for sure, may also be rubbish), this aspect is way overblown in mainstream culture.
As much as the IRS does indeed take it easy on the wealthy, I think they do consider write-offs in proportion to overall assets. Otherwise anyone could get out of paying taxes, including the poors. You could charge $100 to appraise a $10 vintage tshirt for $1M and then just have them donate it to goodwill and say they donated $1M in vintage collectables. Then someone making $30k a year could write off $1M in donations.
Modern art was invented by capitalists in order to compete with the amazing soviet artists at the time. It only took like 3 minutes before it devolved into hot trash designed for money laundering.
I have no confirmation if this is actually true or not, but every time I post the story on reddit the mods are extremely quick to remove it, so that's pretty much confirmation that it is.
It's a known fact that AbEx was partially funded by the feds to combat Social Realism and the Muralists while creating a "homegrown" American art movement that foregrounded the import of individual expression.
E: but to clarify, the statement "modern art is an op" is dumb and wrong and ignores literal centuries of art history
Murals of the 60s were incredibly based and community driven. Wall of Respect in Chicago was a national mecca for African Americans for a while.
Art is a good way for rich people can to launder money or invest money into. I'm really sure if art ever goes down in value, I'm sure it does if the artist gets caught doing something. One of Donald Trumps charities commissioned a painting of himself, and auctioned it off, he won the bid and paid for it will charity money, basically giving himself a painting of himself for free that's probably worth more than both you and me. You can also buy a painting with illicit money, have it sit in an auction house or bank for a couple of years and then anonymously sell it for legitimate money.
Appraisal value is subjective and compared with comparable works on the market. Ultimate it's for insurance and it auction price could radically sell for more. I don't know if people are cheaply paying artists to resale for millions, that usually not what they use art for.
So I have no sources but Ive heard that the rise of NFTs are due to a crack down by the government in money laundering in the art world. Rich people need something to launder their blood money though, and it it's not art or digital art it will be through some other high value asset.
One thing I'll note about this is that art absolutely goes down in value and suffers from the same changes in taste as anything else. Markets get spiked, works get burned, artists aren't as trendy anymore. The really big names will usually pull in big money, but strip away the Sotheby's/Christie's hype machine and works are worth only what someone will pay for, and sometimes that's zero.
the notion that if you don't like a thing it's because you have personal failings keeping you from liking it is dangerous as a potential enabler of bulshit
that's precisely what someone too dumb to understand the thing would say
I mean theres a difference between disliking something personally and denigrating the actual thing itself as "oh its just a line on canvas my kid could do this".
I guess it depends on the art. I think the market has lifted some frankly crappy art to be worth millions for bulshit reasons that being said the reverse is also likely true and there might be another Picasso out there who can't sell a painting
Well, some artists are precisely that. I remember meeting this cool cat from Austria. Then I saw his art. It was stuff like you'd make in fifth grade art class with construction paper, with little windows you could open, like a pop-up book. And all of it monochrome, in fifty shades of gray. It was literally something a kid could make. Yet he was a real artist, I looked up his website. Works for sale at museums and such.
I generally like his videos, but I feel like he's extremely Lib brained.
The trick is to artificially increase the value of that $40 before you donate it, so that it's like spending $2 (real value) instead of $40 (market value)
Reducing your taxable income also bumps you down to a lower tax bracket and your charitable foundation can do things with your money that you can't. So say at $100 you owe 20%, but at $60 you owe 10%. You donate $40 your foundation, which then uses it to buy plane tickets to fly you to TED talks and fundraisers. Say the plane ticket was $30. Before you donated, you wouldn't be able to deduct that from your income. So go from $100 - $20 in taxes - $30 in airfare = $50 on net to $100 - $40 in donations - $6 in taxes = $54 on net and your foundation still has $10 left to boot.
Tax brackets are progressive so money over 60 would be taxed at 20% while under would be 10%.
For simplicity's sake I was using the 20% and 10% as effective tax rates, not brackets. The principle still applies regardless, since you're reducing the income that's most heavily taxed first.
