Art can be a tangible commodity, but what happens when that art exists only as a concept? Italian artist Salvatore Garau created a statue entitled, Io Sono (“I Am”) that sold for $18,300. The sculpture itself is invisible.
“You don’t see it, but it exists,” Garau stated. The artist focuses on “immaterial sculptures” that exist by thought alone. Still, he believes that Io Sono must be displayed in a private home with climate control and provided with 5 x 5 ft of space. This piece of art could rise in value if consumers believe it to be worth more and are willing to pay more. The coverage this concept has received in the news has certainly caused it to become a conversation piece, and therefore, someone out there may be willing to spend more to have an invisible statue that exists as a concept.
The fine art market has become one of the most effective, sophisticated tools for laundering money. Unlike real estate, stocks, or precious metals, the art market is unregulated, unstandardized, and cloaked in confidentiality. It is considered upscale and a tool utilized by those who already have wealth and need a place to park it. Unlike financial instruments, which must pass through reporting requirements, art often changes hands privately, across borders, and without disclosure of the buyer or seller. In this case, the art does not even need to exist, and yet it still was sold through an official fine art auction house.
Art is not valued like stocks. There are no earnings, dividends, or tangible utility. There is only perception. A Picasso, a Basquiat, or a Warhol are not just artworks; they are safe havens for capital, especially for oligarchs, cartel bosses, and political elites looking to move funds discreetly. A $15 million painting hung in a Zurich vault is more secure and less traceable than a Swiss bank account, which is no longer secure.
Mar-A-Lago was once valued beneath Hunter Biden’s “art.” Hunter Biden’s artwork is estimated to be worth up to $500,000. His personal friend, Kevin Morris, purchased a few pieces and also gave him a loan of $2 million to cover Hunter’s late tax payments. Most of his buyers remain anonymous, but the known art collectors are all associated with the DNC. Hirsh Naftali, for example, was appointed by Joe Biden to be the Commission for the Preservation of America’s Heritage Abroad after he expressed interest in his son’s artwork.
Art as an asset is entirely subjective and based on confidence. It holds no inherent value but the public perceives its value and prices it accordingly. Art does not generate income nor does it create economic output. Art is purely speculative and becomes a bubble when confidence peaks.
We saw this in the late 1980s Japanese bubble when Japanese investors were buying Van Goghs and Monets at astronomical prices. That bubble burst along with their real estate and the Nikkei index. We saw it again leading up to 2007–2008, and now, as the sovereign debt crisis looms globally, we’re beginning to see the same flight again. Art can act as a temporary store of value unless you have some extremely rare piece from a renowned artist.
Governments are keen to tax everything, and one day, that could include art. The secrecy and mystery that once caused art to be a store of wealth could collapse if governments act. Since art is primarily used as a temporary asset by those who are already at the top, governments are not yet looking in that direction. Once capital gains taxes are implemented, it will be game over for much of the art world.
