Thursday, October 26, 2006

Art as Economic Indicator

Economic growth continues

Yes there are some disagreements as to whether or not the sustained (5 years now) economic boom has been good for everyone not just the "rich". Eg some say that wages havent kept up with economic growth and labor productivity eg that labor productivity growth - eg technological advancement - has been captured in profits not wages.

The rejoinder to this might be that non-wage income (eg employee health insurance packages and other non-wage benefits) have increased along with the economy and that profits are good for all as more than 55% of people (Americans anyway) own stock in the same companies showing the profit. It is also a good sign that many of the necessities of life - food and clothes - have gotten cheaper relatively - so that the wage buys more. Thank you Target and Walmart and the Chinese and the Indians - and they in turn thank us for our contributions - it is a two way street !!!

Anyway the point of this blog entry is that the Fine Art market is now heading through the roof. (Just as an aside it is Workers take that the housing market was overvalued and sucking in too much of our national wealth - with the correction in this sector - eg the flattening of housing sales prices - funds are now moving to other assets eg art and stocks). Sotheby's is reaching its first $1 billion year and alot of artists are getting record amounts for their works.

But why should this not be? After five years of economic growth - and the advantages to all through global trade and global specialization of labor - why should there not be trickle up as well as trickle down? At least the Japanese arent over-paying for US movie houses and golf courses! They paid big for that over-indulgence!