Art collectors are not simply connoisseurs of art, and in some cases, some may not be interested in art at all beyond a profit motive. This may seem petty to outsiders and those that have not been tempered by the reality of being an artist or in the business of art, but it is a beneficial relationship. Even further, without all forms of collectors, the art business would not be a business at all. It would be a personal endeavor that would bring few artists the ability to profit from their talent and skill. Collectors also play the role of valuing art. Anything is worth what someone will pay for it, but because these people are basically professional art assayers also, they provide an accurate picture of what that rate will actually be. It is much like the stock market, many other factors beyond being a stable profitable business goes into valuating a company’s stock or true worth.
Whether this is fair or not is to be debated, but just like stocks, eventually a real value will be assessed that is really near the actual value. In art, like stocks, a soft market means that most stocks will have a naturally lower price. These are called bear markets, and if you simply own stocks, these markets are a problem. However, astute investors see this as a prime time to acquire stocks at a low rate from strong company’s whose values are only lower because of the state of the markets in general and not from any systemic issues. These are great times to purchase not only because the prices are low, but because when the markets rise again, these strong companies will recover greatly and bring the smart investors the types of returns that make them titans of the industry. Additionally, it makes the companies that provided these returns legends also.
Noted investor Adam Sender utilized this dynamic in his art collecting. By doing this, he has become one of the most famed art collectors in many generations. His contribution has vaulted contemporary art into a position that it has never maintained on its own even in its mid-century heyday. Before an exceedingly genius collector like Sender was able to exploit the soft market in which contemporary art languished for almost three decades now. The soft market was due in large part to the frivolity of the abstract genre. Abstract art was bubble that when the burst, it lowered the value of the entire art market in general and not just the abstract art as a genre. Art being sold for outrageous prices due to hype versus the talent involved or the artistic integrity of the artists will always be a dangerous, easily exploitable bubble that damages art markets severely.