Money Tip: asset-hedge the cultural value of your gallery's immaterial production!

[imomus]

My annual subscription to Artforum expires soon, and I'm getting letters from the New York art magazine's subscription department begging me to renew it. I probably will; the bumper Best of 2007 issue is an excellent read, with its exhaustive scene reports from each major art city and its Top 10 run-downs of the year's art highlights by star critics, curators and commentators. Sometimes, though, you could be forgiven for thinking that money is as crucial to Artforum's editorial department as it is to their subscriptions department.

For instance, I really have very little idea what hedge funds are and what the verb "to hedge" means. It's the kind of thing I'd expect to learn about reading The Economist, sure. But, actually, if you read The Economist and the art press, it turns out to be the other way around. From The Economist you learn cultural stuff. From the art press you learn about money. It figures; when money people get together they talk about art, when art people get together they talk about money.



Let's look at this example of hedging. Reading through the current Artforum I find the term in three different articles.

1. Page 355. A review of The Opening, a new Merlin Carpenter installation at Reena Spaulings Fine Art. Carpenter's schtick is to make the opening the piece, and to spend it daubing rude slogans about his gallerists on the walls while a crowd of art insiders networks and revels in loving/hating themselves for being art world insiders. So, in his show at Cosima von Bonin, Carpenter scrawled "Relax, it's only a crap Cosima von Bonin show" on the wall. For his show at Reena Spaulings (whose incrowdiness I mocked in my Outreach and ingroups piece last year) this became "Relax, it's only a crap Reena Spaulings show". Artforum, while not essentially disagreeing with my scene-that-celebrates-itself take on this, thinks something more interesting is going on -- something to do with economics, in fact, and specifically hedge funds. "Though gathering together a bunch of insiders to celebrate such an event reads as classist irony, to leave it at this misses the point," says reviewer Carolina Busta. "Carpenter's structures are circular, implicating all who play the game. With "The Opening" he hedges the cultural value of his gallery -- an asset underscored by his 2005 show at RSFA -- to enlist its preexisting social body as a ready-made labor force for immaterial production."

Jeez, whatever happened to the good old days when art criticism just required you to have read Lacan? Now it requires you to have read Lacan and Milton Friedman! Let me -- with my very basic understanding of economics -- try and parse that horrible sentence. As I understand it, to hedge is to gamble against the thing you're mainly gambling for, in order to spread your risk a bit. It's a kind of financial expression of treachery, ambivalence, irony, caution and pragmatism all rolled up in one gesture. So you might invest in property, but also invest in something that would benefit from the collapse of the property market, just in case everything went horribly wrong. If we were being a bit more Lacan than Wall Street Journal about it, we might just say that insulting your audience and yourself might be an appeal to the art crowd's insecurity as well as their self-love. But I frankly don't know enough about money to know how hedging relates to assets, and how this artist's show could use another show of his as an asset, let alone do all that "to enlist [his gallery's] preexisting social body as a ready-made labor force for immaterial production". Stumped me there, Carolina. Sorry, I flunked Economic Metaphysics 101.

2. Page 294. A more straighforward use of the hedge concept. T.J. Demos reports on London's current art-money bubble: "All of this owes in large part to the capital's booming financial market and its relaxed regulatory system, so attractive to the financial sector and to its private investors, including the nouveaux riches of Russia and Asia. This laissez-faire environment is also salubrious for newly formed art-focused hedge funds, now growing in the UK at a rate far higher than in the States."

So hedging isn't just happening as something metaphorical that artists do. It's also happening in the art market itself. People are investing in art because, in a world where property looks increasingly shaky, art holds its value better and can be a hedge against losing your wad in a property bust.

3. Page 284. Debra Singer's report on the New York scene paints the same basic picture: "The New York story may seem to be one of money, but even so, it's a tale encompassing many turns. Certainly, the celestial auction prices of an overheated art market dominated headlines in 2007, to say nothing of griping kaffeeklatsches of collectors, curators and gallerists. Yet underdiscussed, perhaps, is how the long-bullish economy has affected sectors of the New York art scene that ostensibly linger on its fringes, enabling small galleries and alternative, temporary art -- underwritten by the city's many investment bankers, hedge-fund managers, real estate developers, and entrepreneurs, whose pockets have for years been overflowing -- has meant that even those galleries cultivating a more renegade, anticommercial stance have sold enough to keep the doors open and, on top of that, turn a tidy profit."

Debra's point seems to be that while the art world talks about money as a negative, even the marginal galleries that are supposed to be anti-money bulwarks are underwritten by the financial fizz of the big world. To return to my theme last week of offshore accounting, this article seems to agree with the basic idea that social outreach may be coming from the heart of the beast itself rather than notionally "pure" spaces somewhere off the map.

I have mixed -- or should I say hedged? -- feelings about all this. On the one hand, I'm rather fond of the idea that some good things -- even things we call "alternative" -- might have a secret origin right in the heart of the capitalist machine. Artforum's On The Ground reports seem largely to be about money, but my own Berlin column for Viennese art magazine Spike basically hyped Wedding, Berlin's latest emerging art district, in a way that would gladden the hearts of estate agents with empty properties in the area (my Wired Neukolln article probably did the same for the district I'm living in now -- the rents haven't been hiked yet). As I said in the Offshore Accounting piece, it's silly to play the game of damning things that pop up in a commercial system because they pop up in a commercial system. It's more interesting, I think, to talk about what's good despite having that basic origin. And by that I mean aesthetically and ethically good. If there's no offshore, we make use of what we have onshore. We fix stuff at the centre rather than wasting our time tinkering at the margins.

John Kelsey is an art insider's art insider -- he's one of the Bernadette Corporation, runs the Reena Spaulings gallery and is one of Artforum's contributing editors. One of his picks for 2007 says it all, really. As his number 6 event of the year he nominates the projection of a video of a band featuring his girlfriend Emily Sundblad, Stefan Tcherepnin (once of The Gongs) and Cory Arcangel, a "semifictional New York dance pop group". They're called The Economist. Maybe I should ask them about hedging my art assets.

Comments

[imomus.livejournal.com]

I'm actually reading the new issue of Art World magazine (http://artworldmagazine.com/) just now (a new British art mag that I'm -- in theory, anyway -- supposed to be writing for) and it's kind of refreshing how little about money it is. Frieze and Artforum have become the money titles (they're the ones with all the ads and the big top art fairs), taking their place alongside more obviously money-oriented mags like Art + Auction (http://www.artandauction.com/html/) and ArtReview (http://www.uploadlibrary.com/artreviewdigital/index.html) with its focus on power-brokers and collectors.

But Art World is actually about artists in their studios -- it's about making, and about biography and how that relates to creative process. It seems to be aimed at people who just enjoy (relatively) contemporary art for its own sake, and don't either collect it or keep up with it because it's where money and power do some of their networking and, ahem, hedging these days. An art magazine for the rest of us, you could say.

[cap-scaleman.livejournal.com]

I read the Swedish Wiki entry for hedging and it says that hedge's among funds are meant to be low risk but can be, no matter what happens at the stock market, be high risks too.

A hedge(-fund) should be, according to most people, avoided at all costs.

These days there are both low risk and high risk hedge(-funds).

So, in a way, they might mean that this art is supposed to be "low risk" but could be, eh, "high risk"?

[imomus.livejournal.com]

If it were a music review things would be clearer: a reference to money ("hedging" or "hedge-fund managers") might be a way to give someone a bad review, as we saw the other day with D. Strauss' review of the Japancakes album in Exberliner. To say that they were making "music for bank commercials", then add that "in New York there's a bank on every corner now" was clearly to cast aspersions on the record's commerciality, and suggest it was somehow a betrayal of the indie ethic represented by its ancestor, MBV's "Loveless". (A bit rich, I'd say, considering that Japancakes probably spent a good deal less than the £250,000 MBV spent on the recording of Loveless, straining the indie label I was on at the time almost to liquidation).

But with the art press, you really never know. Money doesn't seem to bring automatic obloquy. Rather, there's a strategic ambivalence. The writer will say "Yes, on the one hand money plays too big a part, on the other hand money makes a lot of things possible, even really cool ones". (And actually, that seems to fit the My Bloody Valentine scenario quite well.)

I wonder, though, what today's music press would be like if the writers in, say, NME or Q wrote mostly about the financial structure of the music industry, and how that enabled some things and disabled others? I must say, I find it interesting / not interesting. I like when it's present, that talk, and I like when it's absent too.

[akabe.livejournal.com]

love the green hedge pix.

well, here's your true rockist/post-modernist challenge.

(i'm -finally- reading through all these recent antonio negri books and totally love the way they talk about post-modernism as basically something yet to happen.)

[cap-scaleman.livejournal.com]

And by the way, why do you blend economy and art? Artonomy? Euh, well, I don't know much about the fields of philosophy and math, but if you can blend philosophy and math then you maybe can blend economy and art. But then you either have to think of art through economy, or vice versa. Or would there be a field in the middle of the two?

[cap-scaleman.livejournal.com]

Oh, wait, isn't it so that japanese artists spend more on the visual art work for their albums than western artists?

It would be interesting to make some kind of chart over how much money was put, and specifically where, in the production of an album. Was it the single's video? The cd sleeve artowork? Production and guest artists? Promotion? Quantity of cd's being printed? Etc, etc.

Maybe Steven Levitt (http://en.wikipedia.org/wiki/Steven_Levitt) could do something like that?

[(Anonymous)]

As far as My Bloody Valentine's Loveless is concerned, I think Alan McGee got carried away: he really seemed to believe that album was going to go platinum, that MBV were on the verge of being massive, the next stateside phenomenon: The Cure, Nirvana and MBV... So I guess that wasn't hedging, that was his main project, he expected Loveless to generate a huge return on investment...
McGee finally fulfilled his dreams of world pop domination with a bunch of cheap and cheerful Man City hooligans three years later, but by then Creation was only a subsidiary of Sony, wasn't it...

[(Anonymous)]

I don't think having a lot of money has made anything better for artists ... the best art I see is made by penniless loser nobodies who are fun and passionate and weird and make their own way in the world (which is becoming increasingly rare, so they often trudge in "dirtying" unromantic day jobs in unfashionable cities or neighborhoods). It's just hard to find it because publicity is often a method used to increase value in a particular artist whom someone/an institution has invested in. Attention is explicitly denied someone who isn't seen as capable of high yield.

[desant012.livejournal.com]

Art people are money people, though. They produce investment vehicles much like any bank these days... so, established artists are a lot like bankers and they have the money to show it.

[desant012.livejournal.com]

and if anyone's feared it, I've met many a young up-and-coming artist whose sole intention is to completely cash out - so they create art they feel would get chosen as investments. More power to them since it's usually the people who grew up poor ... but you know, to assume money hasn't changed anything is off things a little.

[imomus.livejournal.com]

I don't think having a lot of money has made anything better for artists ... the best art I see is made by penniless loser nobodies

Isn't it funny that that can sometimes be the same work, though? For instance, the Turner Prize just went to Mark Wallinger for his reconstruction of "penniless loser nobody" Brian Haw's protest banners. They cost Wallinger almost £100,000 to reconstruct in the Tate, so the £25,000 Turner Prize still leaves him considerably out of pocket.

[imomus.livejournal.com]

But I don't think anybody is saying money hasn't changed anything. I think there's consensus in art criticism that money is a force both for good and evil. It's both productive and destructive. So the focus becomes adverbial: how is money being used? And that's an interesting question.

penniless loser nobodies

[pay-option07.livejournal.com]

I'm kind off out on all this wall street economic mental constructions applied to the art world. Art isn't that cold and material. I would compare it to more the unpredictable agricultural economy that can bloom or not in different climates and influences. The little nobody organic grower can self consume or share with neighbours. The inspiration to share the goodness may send it to the local farmers market. The ancient satisfactions for barter and trade are greatly satisfied and agrarian processes are streamlined. Greater venues to display the fruits of labour
are chosen and the produce is branded and reborn in an ARTFORUM supermarket if it hasn't yet met competition or taste tested. I'm extemporaneously projecting the marketing process of all this some how ending up in corner shops and vending machines. Oh how terrible this all sounds, like some Dickens tale to unravel with woe.

Re: penniless loser nobodies

[imomus.livejournal.com]

I think what I find fishy is example one -- the use of hedging as a metaphor -- rather than examples two and three, which are simply talking about the actual conditions of the art market. Because, as I said in the piece, there you're getting into economics-as-metaphysics, especially when you mix it up with theories of "immaterial production". It then begins to seem like money talk is just the latest form of ridiculous abstraction, just as Marxism, post-structuralist theory and other abstract jargons have been in the past in bad art crit.

Also, I think money plus metaphysics, or money-as-metaphysics, is a particularly unattractive combination. The passage at the end of my Superflat essay (http://imomus.com/thought280600.html) shows the kind of awfulness that results (in 4th century Constantinople, in this instance) when you mix them up. Could we be going the same way? Is money not just our material base but also our metaphysics?

[kumakouji.livejournal.com]

At the risk of sounding like an Art puritan weeping at the sight of creative sacrilege (and believe me I'm not); All this talk about money where Art is concerned makes my heart sink a little.

I don't think there's anything wrong with Art as a fiscal endeavour, this is not a point of principle. it's just when money starts to partner up with Art it brings out all the qualities in Art I personally hate the most.

For example, speaking as a former graphic design student, I think the first thing the head of the art department should have done during induction was sat us all down and said:

"I know why you're all here. In your heart of hearts you all really wanted to enroll on a fine arts course but you decided to take a more vocational avenue, and I applaud your realistic practicality. However, the financial stability you hope to find in a career in graphic design comes at large cost a lot of you will slowly grow to resent..."

At which point the nagging uncertainty at the back of my mind would have been revealed as the giant crux it ultimately was for me and I would have got up and left. Of course, I'm talking about the compromising of creative freedom for financial gain.

Almost everyone with art at the centre of their career at some stage has to compromise this aspect of themselves to bring in the money. that is unless you become famous where you can shit on a piece of paper and people will buy it, like a self-perpetuating hype machine, or you're willing to take the romantic root taken by many members of the creative class for hundreds of years: become the starving artist.

I'm slowing moving out of graphic design while I'm still young. My "art assets" will doubtless always be worthless, but they'll be mine uncompromised and that's all that matters to me.

[imomus.livejournal.com]

the compromising of creative freedom for financial gain

While I don't deny this does happen sometimes, I don't think there's any fixed connection between compromising creative freedom and earning money. In other words:

1. People who get rich from creative activities have often not compromised their creative freedom at all.

2. People who have compromised their creative freedom haven't automatically got rich doing it.

3. I'm rather suspicious of the notion of there being this offshore sort of "creative freedom". I think a more realistic picture is that creativity is produced by the opportunities to exercise it, and that we have to include money as one of the things that structures those opportunities.

To put that more concretely, it's not that I "have songs in me" and compromise with the music industry to get them heard. It's more that the music industry exists, and I notice that and therefore make records. If the music industry disappears, I go off and do something else.

[kumakouji.livejournal.com]

Something I've noticed about you is you seem to be very fixated on the idea of art as an "industry", which is especially true of your view of music. I'm not sure whether this is because you're a minor celebrity who mingles a lot of with other minor celebrities or it's just a facet of your personality.

1) Very few people "get rich" from art. The people who do "get rich" become rich because thier art has become celebrated to some degree.

"Artists" arent just people with Wikipedia entries who've had some degree of notable success -- they're normal, everyday people where being creative is part of their personality. These people either pursue art as an interest, or they work in the industry and do projects they're commissioned to. For example, I've had to design long distance call banners in my past as a graphic designer. My mum's friend who I mentioned a few posts back has to do backing vocals on other people's albums. We're not rich or notable, and we're in the majority, there are millions of people like us. The people "who get rich from art but dont have to compromise their creative freedom" are more part of your world than mine, but they're in the minority.

2. Most people dont compromise their creativity to become rich, they compromise it to pay the rent.

3) Money as a consequence of artistic freedom is perfectly dandy as far as im concerned. Money motivating art is a game I'd rather not play because then you start getting into the "well, this idea is good, but this idea would sell better" mentality, which saps me of the one reason why I love art: creative expression.

" it's not that I "have songs in me" and compromise with the music industry to get them heard. It's more that the music industry exists, and I notice that and therefore make records."

Like I said, I'm not an art puritan (and that comment right there would make any art puritan sob...) but I don't empathise with that at all. My art comes from a sheer desire to express my personality, yours seems to come from a "supply and demand" mentality. I think that's why you have such a dissatisfaction with the music industry right now. If you had a passion for creating art purely as a creative vessel, this whole business of the music industry colapsing wouldnt be an issue. I think people like you almost always end up dissatisfied because you rely hugely on outside influences for validation, where as most of the artists I know get their satisfaction from within their very canvases.

[lord-whimsy.livejournal.com]

Been hopping the art/design fence for years. I fail to see why we can't apply our skills to multiple spheres; the only barrier is professional parochialism. Why can't I design a typeface and do an installation or performance piece? Why can't I design and write a book and inspire a band to write songs about plants? Why can't the tools of design be a means of making art as well as a way to create things that have a direct role in people's everyday lives?

This month I've designed an identity for the museum that houses Joyce's manuscript for Ulysses, talked with curators about an installation in a NY gallery, and now I'm going on a field trip with the staff of America's first botanical garden to research carnivorous plants to help them set up their own bog garden in the spring. Then I'm coming home to do an editorial illustration.

There's no reason you can't do this, too. All that matters is that you do it well.

[cap-scaleman.livejournal.com]

While we're still talking economy there are something called Islamic Economics (http://en.wikipedia.org/wiki/Islamic_economics)! Wow, I wonder if it is actually recognized among western economists in general.

[kumakouji.livejournal.com]

Islam doesnt believe in interest, which drastically contrasts thier economic system with our western system. It's not that surprising really...

[imomus.livejournal.com]

My art comes from a sheer desire to express my personality, yours seems to come from a "supply and demand" mentality.

I think I'm just a lot more suspicious of the romantic notion of creativity and individual genius than you seem to be. I think it's fairly silly to imagine someone being "born a graphic designer", for instance, independent of any sort of publishing industry. Think of how those "born graphic designers" must have suffered through the millenia before Caxton and Gutenberg! They must have itched to open Illustrator and get cracking "expressing" their "vocation" -- but computers hadn't been invented yet! Nor publishing! Nor paper! I suppose they just went off and kerned a couple of rocks.

[cap-scaleman.livejournal.com]

Yes, but it is quite a new branch of economy, right? Unless if you look at the history whereas that wiki-article says that capitalism and the idea of free market originates from early Islamic economy (which later was adopted in Europe and further developed).

Well, I am not the one to talk about economy since I am bad at math in general, but the origins of economic systems like capitalism and socialism interest me. Plus, this is a bit obscure so it is of value to me. Hehehe.

[lord-whimsy.livejournal.com]

There are muslim mortgage companies here in the States. From what I've heard, the arrangement sounds more like leasing than a traditional mortgage, but it's interesting.

[cap-scaleman.livejournal.com]

Interesting. I should say it was very close that my class would visit the mosque of Stockholm once for our religion class but they charged money for the visit. So it never happend...

[kumakouji.livejournal.com]

"This month I've designed an identity for the museum that houses Joyce's manuscript for Ulysses, talked with curators about an installation in a NY gallery, and now I'm going on a field trip with the staff of America's first botanical garden to research carnivorous plants to help them set up their own bog garden in the spring. Then I'm coming home to do an editorial illustration."

This month I've designed take-out menus, Flyers for a gay club night and buttons and backgrounds for a website. Welcome to the world of being a young graphic designer; wet behind the ears with only a few years experience.

"You get out of graphic design everything that you put in! Make every project your own!" my lecturers used to say, the over-optimistic sell outs, who evidently took on teaching to supliment their own incomes...

"I'm not sure this is what we're looking for; can we change this and possibly make this a little more crisp please? I'm not keen on this colour scheme, I also think those photos need repositioning." my clients will say, because after all, you're commissioned to create their visions not your own. As your work gets prodded and poked and remanaged it changes into something you're not familiar with anymore -- "Im not sure this is suitable for our target audience". It stops being art and becomes a "craft", devoid of the freedoms that spurred me on to pursue an artistic profession.

Before you know it you're making leaflets for the NHS about flu shots and advertisements for long distance calls to appear on websites. I am the "penniless loser nobody" (as someone above put it above) who designs your organic potato chip bags and "How to" washing machine illustrations.

"you have to stick it out, this is all part of building a career. Climb the ladder, boy." I can hear my grandfather says as we talk about my life. The truth is, you're not guaranteed artistic freedom as you get older and more experienced, and from what I've seen the older you get the less interested people become in you. They want fresh, up-ad-coming talent. I was talking to a guy in his mid 50s the other day just by chance; he was the creative director of a very large PR firm here in the UK. He'd recently been made redundant. He was convinced its because hes too old.

I'm very happy for you that you're involved in such fantastic projects that you love, I wish you all the success in the world. In my experience the graphic design industry is rarely like this. Without total artistic freedom art means nothing to me. I had to learn that the hard way.