Why billionaires like Jeff Bezos are investing millions in contemporary art

In the 1987 film Wall Street, Michael Douglas played the role of Gordon Gekko, a powerful and ruthless corporate robber. Charlie Sheen portrayed Bud Fox, an aspiring Wall Street stockbroker who eventually became one of Gordon Gekko’s stock traders. There is a scene in the film where Gekko was talking about his painting by Spanish painter Joan Miro (1893-1983). The painting is Paysage, an oil on canvas from 1974. Regarding the Miro, Gekko told Fox:

“This picture here. I bought it ten years ago for $60,000. I could sell it for $600,000 today. The illusion has become real and the more real it becomes, the more desperately they want it. Capitalism at its finest.”

Image Credit: Source: 20th Century Fox

Art can be seen on the walls of the rich throughout the film. Some notable artists who featured on “Wall Street” were:

  • Jean Dubuffet

  • Luke Samaras

  • Jim Dine

  • Robert Mirmelin

  • Keith Haring

  • Julian Schnabel

  • Jacob Rosenquist

But it’s not just the fictional super-rich of the 1980s investing in visual arts. Two notable real-life standouts are today Robert Soros and Amazon.com Inc. (NASDAQ:AMZN) Founder jeff bezos. Soros is the founder of Soros Capital Management and the eldest son of a billionaire investor George Sorosmade famous in 1992 by short selling the British pound. Jeff Bezos made his fortune with the company he founded, Amazon.

ARTnews.com reported that Bezos became the first person worth more than $200 billion to also be revealed as an art collector that same year. A painting by Ed Ruscha entitled Hurting the Word Radio #2 (1964) sold to an anonymous telephone bidder at a Christie’s auction in November 2019 for $52.5 million, setting a record for the artist. The anonymous buyer turned out to be Bezos, according to the Baer Faxt newsletter, which reported that the billionaire also bought Kerry James Marshall’s “Vignette 19” (2014) at a Sotheby’s auction for $18.5 million.

So why is there so much interest in the visual arts among the super-rich like George Soros and Jeff Bezos, to name a few?

Contemporary art prices actually surpassed that S&P500 almost tripled from 1995 to 2020. Contemporary art has also risen faster than stocks, REITs, and even gold during periods of high inflation. So it makes perfect sense that those with the means to invest in multi-million dollar artworks would do just that.

However, the average investor can find it difficult – if not impossible – to invest in multi-million dollar works of art. To meet this challenge, there are new startups that allow investors to buy “shares” in fine art for a minimal investment. These works are kept safe while they increase in value, later sold and the proceeds distributed to the shareholders.

Normal, everyday people can now invest in visual arts alongside billionaires like George Soros and Jeff Bezos.

More about alternative investments:

Photo by Hayk_Shalunts on Shutterstock

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