Trump: How do the rich feel about the new US president?

This week, the art world is abuzz with major auctions that could change the course of the market, headlined by the work of Maurizio Cattelan, “Comedian”, a banana taped to a wall, which is expected to sold for up to $1.5 million. Along with Cattelan’s work, other iconic works such as “New York Skyscrapers” by Andy Warhol and “Empire of Light» by René Magritte are expected to fetch over $1 billion at auctions conducted by major auction houses, Sotheby’s, Christie’s and Phillips.

These ones auctions come after a difficult year for the art market, with in 2023 to register a decrease of 27% in sales of high-value works, the first such decline since 2020. Despite this decline, industry experts are hopeful that the upcoming auctions will signal a recovery in the market, particularly after the recent election victory of President-elect Donald Trump. Many believe his victory could revive the market, thanks to pro-rich policies such as tax cuts, which could boost demand for art.

THE Alex Glauber, art consultant, argues that the tax cuts implemented during Trump’s first term helped the wealthy grow their fortunes, and these same people will likely be the drivers of the upcoming art markets. This is true for both emerging and established artists, as economic policies that favor the super-rich should boost consumption in the art market. But other experts, such as Todd Levin of the Levin Art Group, are less sanguine, arguing that the tax cuts alone will not dramatically affect art markets.

Raised interest rates “kill” art

Another major factor affecting the market is high interest rates. OR Federal Reserve Bank raised interest rates to fight pandemic inflation, which has slowed art sales in recent years. However, as interest rates have begun to fall, art advisers are optimistic that this will make it easier for the wealthy to invest in “hard” assets such as art. As Glauber notes, cheaper capital could revive demand in the art market, but there are concerns that this will be short-term if inflation returns.

“The purpose of ‘Comedian’ is to draw attention to the larger context in which it is exposed”

Despite these uncertainties, optimism remains strong in the week’s auctions, especially as New York’s art scene sees renewed interest. Auction houses report an intense atmosphere of anticipation for the end of the year, with the upcoming art fairs in Miamiand be ready to close the artistic calendar of the year.

While many experts agree that the market will continue to be affected by factors such as interest rates and inflation, some, like Amy Whittaker, professor of art and economics at NYU, argue that the true value of these auctions lies not only in their price, but in the opportunity to reflect on the artists and their works. As Whitaker said, “The purpose of “Comedian” is to draw attention to the larger context in which it is exposedj’, emphasizing that art auctions offer an opportunity to appreciate the creative and historical significance of the works being sold.

As the art world navigates these economic dynamics, upcoming auctions will be an important indicator of market direction and the preferences of the world’s wealthiest collectors.