First real investment on the Rocks???
When I decided to go into the antiques and art road of business i had literally no money and no experience in anything antique or art. I was a newly arrived man in the country, I was basically penniless. When i asked the local bank for a loan of two thousand pounds in October 1983, my application was rejected with one promise from the manager of the branch. Go and do your business for a couple of years with your own money, however much it is, and come back in two years time. I will monitor your account carefullyand if you prove to me that what you are saying to me now, i will give you six thousand pounds immediately you are back, not two thousand you are asking for now.
True to his work, he agreed to lend me six thousand pounds in early 1985. With the 2000 pounds from the sale of Lawrence in San Francisco i was on my way to make the business work or fail.
Turning the clock back to 1985
Art dealing is very satisfying, but it is also full of banana skins that nearly all dealers and investors step on sooner or later. This is more so in the initial stages of investing in art, which can put an end to the dream before it even starts.
April 1985, Cologne, Germany
‘Zugeschrieben’ – you beat me! What did this word mean? What does it mean? I had never heard of it, never seen it before and I speak and read German to some degree. Art’s specialist vocabulary or jargon is very important and one has to know the difference between art described as: ‘follower of’ ‘studio of’ ‘after’ an artist ‘attributed to’ an artist or indeed by the artist. The auction catalogue from Karola Van Ham in Cologne arrived two weeks before their auction. Requesting catalogues from auction houses was part of my business as early as 1985. They kept me informed, taught me about artists and prices and were literally my textbooks. I had plenty of time to go through the catalogue and the images and study the contents. It was a mixed sale of all kinds of art, china, pottery, furniture and lord knows what else. That was a good omen. A mixed sale might hide sleepers in it! Experts, who normally knew more than an amateur like myself, usually catalogued specialist fine art sales!
What was my chance of a bargain in Germany? Very slim, judging from the illustrated catalogue. However, there was an impressive painting that attracted me immediately, but it was not a sleeper! The estimate of £3000 was just right, if I bought at that price. I felt comfortable enough to buy the most expensive item I had ever bought at auction up to that moment. Actually, I had never bought anything above one hundred pounds until that April, never having had the money before! Now with a sale of £1800 and also an overdraft of £6000, it became possible to buy a painting of £3000 and possibly another one or two. Was I going to leave the money in the account to be wasted? No chance! Not me! Always in a rush and always impatient! My thinking was “money makes money” and I had already proven to myself that with nearly no money I had accumulated a significant sum of money. If I was any good in this art business there was a lot more to be made!
Johan Barthold Jongkind (Dutch, [1819-1891] Jongkind painted in a classical/romantic style and then became the forefather of Impressionism in the early 1860s. Auction price range £2000 – 80,000)
The Johan Barthold Jongkind painting in the Van Ham catalogue looked magnificent in colour; it was signed twice and dated 1843. Depicting a beautiful Dutch canal scene with a windmill, boats and figures at work it oozed quality and immediately attracted me. Was I good enough to judge the quality? Was I experienced enough to make the huge jump from one hundred pounds to a £3000 plus painting? On the face of it, NO, but I was in a rush! I had to make up for lost ground!
Another painting by Jongkind
Looking back, it was a huge leap that might have proven to be my undoing and the end of my plans and dreams to be an art investor. Yes, by early 1985, I felt it was a good second job and para-occupation to get my teeth into. I had made a penny or two and that went to my head. This can be done time and again, I kept repeating to myself. It had worked from Brighton to Birmingham, from London to San Francisco. Why not again and again everywhere? I was capable, I had proven that already, but not with a £3000 purchase! The Cologne catalogue was very impressive and more impressive for 1985 were the colour illustrations of their best paintings among which was the Jongkind. It was the best I had ever seen in any catalogue I had gone through; it was a masterpiece and I was infatuated. Described with the whole name of the artist, a fact indicating it was a work by the artist, and with that in mind and as a guarantee, I left a bid of £3000 (roughly £3700 when commissions were added) without asking for any further information.
Details such as authenticity, provenance, exhibitions and literature (‘APEL’), essential when making any art purchase, did not enter my mind. How naïve and ignorant was that! In a nutshell I had decided to invest so much money in a painting even though:
• I knew very little about the artist and had only two results written down in my booklets. All I knew was that the artist’s work was selling in London at double the estimate of the Cologne auction house, but I had no idea of the images and style of the paintings that had been sold in London.
• I had not inquired about the authenticity, condition or provenance of the piece. The signatures persuaded me that the painting was by the artist and I felt the quality of the painting was considerably better than many paintings I had seen selling at auction in London for a lot more than three thousand pounds.
Could I say it was a masterpiece after just eighteen months in the art business? Was I qualified enough to have such a view? No! I do not think so. But there you are! I felt very confident. The attractive Jongkind won me over! I threw caution to the wind and jumped head first into the unknown world of expensive art. Trusting the auction and their cataloguing and without asking such basic words as authenticity, condition, provenance, I left a £3000 bid for the work of the Dutch master. I was buying in Germany from a catalogue written in German and I was staking about 40% of my cash and assets. It was a gamble, which could have serious consequences! I was reckless, but was I also wrong? Yes! The catalogue was written in German and one word in the description of the painting stuck in my throat a couple of months after I had bought the painting. “Zugeschreiben!” I had not seen the word in the catalogue, had never heard of it and even if I had spotted it and read it, it would have meant nothing to me. Specialist vocabulary in fine art plays a major role in the value of a work of art and that was something I learnt soon enough. A day after the auction I found out that I was the buyer of the Jongkind. I was very excited but also a little worried because I had left bids on three paintings and had ended up buying all three. (The two others were of no consequence, in the £500 bracket by insignificant artists.) On checking other prices and results in the paintings section of the auction, the story was similar, depressed sales and prices. No worries then, I reassured myself. Anxious to get the paintings to London and see them in person, I flew to Cologne a few days later with cheque in hand, collected the paintings and returned to London the same day with the paintings as cargo. Easily done, experience necessary for future similar situations.
Learning the hard way to import art Easily done up to the customs area of Heathrow. Can you imagine yourself in the customs area of Heathrow Airport, London with items of a few thousand pounds and no idea how the importation of art works? How about with three paintings worth just under £5000? The customs officers were impressed by the paintings but also angry with me. I should have arranged for an agent to prepare the necessary import paper work. Did I know anything about that? No! Nothing! I felt ignorant and inadequate, but I was prepared to go through the hoops and humiliations of ignorance in order to learn the business first hand. Although angry with me, the chief customs officer was also kind enough to arrange for an agent to come and clear the paintings. Nobody gives away secrets and information in any business, and learning first hand and the hard way was the only way! I can assure you in all honesty that, with a couple of exceptions, which I talk about later in the diary, no investor or dealer in art offered me a piece of advice, unless it was part of their job.
In any case, after two hours in the customs area at Heathrow Airport, I was free to go with my proud load of paintings. What an ordeal and test of nerves! Nevertheless such an experience was necessary if I was to become a serious investor who imported and exported art. The experience taught me that:
• I needed an agent to import art and a different kind of documentation to export art.
• I did not have to pay any importation tax on paintings over one hundred years old and created before 1925. Today any work of art imported from the EU attracts no importation duty.
• Importation of art from any other part of the world attracts a duty, 5% these days, and VAT might apply in certain cases.
• Operate legally and know the rules of the trade
In a short space of time I had made quite a jump from North Finchley London and a ten-pound candalebra, to Cologne Germany and five thousand pounds’ worth of paintings. Quite an acrobat! But was I also a clown?
The first heartbreak at Sotheby’s
July 1985, Sotheby’s London I deliberated, I procrastinated and agonised over whether to sell or keep the Jongkind – the first major painting I had invested in. Day after day, week after week, I questioned myself. I asked other people’s opinion. The only reason to sell was my burning desire to learn the business of trading art at the highest level, if it was possible. Keeping the painting would have meant an end to that dream.
Reality can be destroyed, hope can be buried but never allow a dream to die away.
Thus off to Sotheby’s I directed myself to consign the Jongkind and keep the dream alive. It was early July 1985 and the time to consign art for the autumn sales. Which sale and which department was the question, the impressionist or the 19th century department? There was no significant headache in making a decision. Impressionist art was the most popular section of the art market, which also achieved the strongest sales. Furthermore, Jongkind’s best prices were achieved in impressionist sales. The timing of consignment was important. I had already bought a pretty Henri Lebasque painting in San Francisco, also marked out for the same Sotheby’s sale. I knew already that if I consigned two or three paintings at the same time and with the same auction and experts in charge, they would look upon my business more favourably. More business offered through them, meant more money for them in commissions both from seller and buyer! Such knowledge and policy I employed on many occasions and that won me the experts’ favour and respect! Experts do give favours, and these we all need at times! This fact will become more evident in the stories to follow, but it is not a rule, I might add!
I was in the art world of elation, deflation and remunaration, if i was good enough and lucky enough!!
The finish of the story next Sunday!!