Over-paying for an easily transportable item (in the case of unfortunate events unfolding at or near your own domicile) such as art is not such a bad idea. We have seen a panic for art many times in history, and as I said, there is a certain convenience with the ability to fit 100 million dollars into a suitcase. However, it is also clear that this activity is another lens into Chins's future.
full article here.
Once again, China has surpassed the United States in a key economic number. No, it's not GDP. It's art. In four years, China has zoomed past us from the world's fourth-biggest fine art scene to the world's largest auction market for art. Just last week, Chinese buyers helped Sotheby's and Christie's set (yet another) record by bidding up the price of a Chinese vase estimated to fetch $800 all the way to $18 million -- a 22,000% mark up!
That's the kind of fever pitch the Economist captured when it reported "astonishing bidding" by wealthy Chinese across the globe as "record after record has fallen away as newly wealthy collectors from mainland China have piled into salerooms in London, New York and Hong Kong."
China's meteoric rise in the global auction world might be a sign of well-earned wealth. But periods of record bidding are scarily accurate bubble predictors, according to Vikram Mansharamani, author of the Boombustology. They're a "symptom of overconfidence and hubris" as a newly rich society spends its easy money with exponential flamboyance.
It's not hard to see signs of froth and fake wealth in China. Housing investment hit the inauspicious mark of 6% of GDP, the same level the U.S. touched in 2006 before our bubble burst. Meanwhile, the Chinese government has spent lavishly on ghost towns like Qungbashi (a city built for 1.5 million residents and occupied by only 20,000) and ghost malls like New South China Mall -- built to handle 1,500 tenants but home to only a few dozen.
China's appetite for fine art isn't a stray indicator, Mansharamani says. It's a telltale clue from a disaster movie we've seen play out at least three times before.