(Read More: Will Artspace become the next Amazon?)
Fine art is an $80 billion global market and the co-founders of Artspace.com think an online marketplace can grab $10 billion to $15 billion of that total.
“We’re building a marketplace for fine art that we source from the world’s leading galleries, cultural institutions and museums worldwide and make those accessible to a broader global audience,” co-founder Christopher Vroom told CNBC’s “Squawk on the Street” this week.
The art e-commerce website went live 16 months ago and now boasts 100,000 members worldwide.
But Artspace doesn’t only cater to the wealthy.
(Read More: Billion Dollar Art Auctions: Fall 2012.)
“We’re trying to make works really accessibly priced for people,” co-founder Catherine Levene said, “and if they want to move up the ladder, we’re offering those pieces as well.”
Prices start as low as $200 and can climb all the way to $100,000. But mostly, prices are under $5,000.
Artspace sells art from well-known, established artists like Sol Lewitt and Robert Rauschenberg, but it is also a place to find emerging artists that Levene said are going to be the next emerging stars.
“We’re still in the early stages of the Internet transformation, so today, we’re partnering with galleries, cultural institutions, museums all around the world,” Vroom, a former Internet analyst at CSFB, said. “They have fantastic works they need to expose, so we are partners with the galleries and across the entire ecosystem we’re bringing them all together in one platform.”
As an investment, Vroom said the contemporary art market and the fine art market more broadly have been an extraordinary place to put money over the past decade. The $1 billion in contemporary art sold at auction last week at Sotheby’s (BID) and Christies lifts the value of other works, Vroom noted, “and that creates an opportunity for everyone to come to Artspace to find works that are accessibly priced.”
Artspace is continuing to invest to build its business for the future.
“We think this is a $10 billion business so we’ve generated terrific traction for really an early stage business model,” Vroom said. “It’s clear that there’s huge value that we convey to the galleries, museums, cultural institutions. And for the 25 million households in America that buy art every year, we offer them the choice that really doesn’t exist anywhere else.”
The SPY (S&P 500) closed above its 40-week moving average Monday. If the SPY can hold above its 40-week moving average; it might trigger long-term technical buying into to the market. The 30-week and 40-week moving averages (M.A.), act as a ceiling if the price is just below, and a floor if we can close above them.
We are above the 30-week M.A. though, by just a bit.
Friday we had an opportunity to close above the 40-week M.A. but could not. The trend in the last week was strongly up but we also appear to be tired. To LOTM’s eye, it looks like we will need a pause or pull back first before the SPY can close and stay above its 30 and 40-week moving averages. A decisive close above the 40-week (or 200-day) could create a panic buying spree into year-end. Headline news plays a big role, but in general the market has been moving higher since early October. If we have more positive headline news we could really blow out to the upside going into year-end!
Do not ask for logic in this. Technical traders have their disciplines and a decisive breakout above the 40-week (200-day) moving average will force them to buy. Look back in time (chart below) to other price crossing of the 30 & 40 week moving averages for a historical perspective.
It is hard to know what to do these days, one soothsayer says 1000 point down is coming, another say’s 1000 point up before the end of the year! Both have good track records. The truth is, no one knows what would happen with a default of debt from Europe. One thing is for sure, governments around the world are trying hard not let a default happen. The big question is, will they succeed? More importantly, what is the cost if they succeed or don’t?
The printing presses are at work so it would appear that an increase in the inflation rate is on the horizon. In my mind, that is what will happen. The result if they do not succeed is deflation or depression. I have seen the U.S. come close to financial collapse before, but it was within the US or limited to a specific country or region. This is new, and it is a direct result of globalization. We are living in interesting times.
I have attached some links to very good articles discussing both the good and bad coming out of the current situation. I suspect we will muddle through this with higher inflation being the outcome. Run-away inflation? That I do not know. Only time will tell.
World Power Swings Back to America – By Ambrose Evans-Pritchard, International Business Editor, The Telegraph – 23 Oct 2011
The Western World Is ‘Finished Financially’: CIO – 30 Nov 2011 – By: Antonya Allen Assistant Editor, CNBC
By Cordell Eddings and Tom Keene – Nov 30, 2011
In summary, as I said above, I think we will muddle through. That is what we do. Buy companies you like long-term even if you are trading short-term. Lock in some dividends while the rates are high. The biggest sleeper risk? US Treasuries. Why? Because interest rates are artificially low, and sooner or later, Treasury prices will go down as interest rates go up. This is the time to be moving into more risk, because prices are cheap, and the price for safety in treasuries is high.