What a first-time art investor needs to know
Fiona Zerbst | Johannesburg, South Africa - Mar 31 2011 14:05
Investing in art may seem like an arcane or dubious investment practice to the uninitiated, but we do know it can bear fruit. Art does have investment potential -- it's considered an alternative investment that offers investors the chance to diversify out of equities and bonds. It can enrich a portfolio and, of course, it rarely shows vulnerability when it comes to the vagaries of financial or property markets.
Stefan Hundt, a specialist at Sanlam Private Investments' (SPI) art advisory service, and the curator of the Sanlam Art Collection, is well-placed to advise a first-time art investor of what to look for. For one thing, the art market isn't liquid, so you need to think long-term about this kind of investment.
"Selling a piece on the open market isn't easy, particularly if you want to realise full value," Hundt says. It's a slow process and you really do need to understand this before jumping in: "For part-time art aficionados and buyers, it's vital to understand that, like any investment, timing is crucial; as is good advice," he says.
Research your potential investment
It's vital to build up knowledge about the sort of art you'd like to collect. Research the artist and the market in general and speak to experts in the field, and artists themselves. You'd research a company before investing; the same applies here.
"Take your time, think beyond aesthetics and if you are only interested in the 'marketability' of a piece be careful not to become too emotionally attached to it," says Hundt. "Know that the value is not in the signature on the artwork, but the individual work itself. Consider the longevity of a painting, how prolific an artist is currently and what is unique about the art, the artist or the context for the art."
The tricky thing about buying on the basis of reputation alone is that this might not be the best kind of investment -- past performance doesn't indicate future performance. "Look beyond past performance and delve into the fundamentals of an artist's success before you invest," says Hundt. Basic advice is free and you can find information on the internet, in galleries and by speaking to artists themselves.
Get independent quality advice
Perhaps you're not familiar with the art world, but don't make assumptions about it. Don't purchase art without getting quality, independent advice. Hundt suggests you speak to dealers, agents and auctioneers with a long-term stake in the market, who also want to develop a long-term relationship with clients. They can provide good advice even when it isn't going to directly promote the stock they sell because they realise a healthy, growing art market is worth more than a quick sale. Ask around -- find out who can provide this kind of advice.
Avoid dodgy dealers
"Beware dealers, auctioneers and galleries without a fixed premises to trade from, and/or who promise unusually good returns, or describe each painting they offer as an 'investment'," says Hundt. "They have a stake primarily in their current stock only and this is what they will promote aggressively."
The art market is an unregulated industry (valued at about R2-billion a year in a recent survey), which simply means that anyone can participate, irrespective of knowledge or experience. Unfortunately, this means you may well come across unethical, unprofessional sellers, producers -- even buyers. "
Importantly, don't be put off by arrogance or haughtiness, because it could be
masking incompetence," says Hundt. Don't be afraid to ask "stupid" questions -- it's your money, after all. Discussions need to be transparent and information comprehensible.
What should I pay?
It's difficult to say what a beginner investor should pay, because it depends on your financial position and your capabilities. Investing in art shouldn't be done in isolation from other investments. You're best placed to know if an investment is feasible and affordable.
"You could acquire a good representative etching or lithograph by an artist with a growing reputation, or a smaller painting from an emerging artist with a good fundamental background and history, for as little as R5 000," says Hundt. Should you have more to spend, you need to refine the strategy, prioritise and differentiate between long-term, medium-term and speculative purchases.
With about R65 000 upwards, you'd be able to buy a good representative work by a recognised young contemporary artist well on their way in the market. If you have more substantial resources available you would be able to acquire a good artwork from a well-established artist from R100 000, Hundt says. "When purchasing art for investment, stick to your strategy and realise that sometimes you could be wrong. However, over the long term, the art market does prove to have some 'logic', and quality prevails."
Two other pros to investing in art: no capital gains tax is payable on art if it's owned by you as an individual, for your personal use; and you get to enjoy the ownership of the work and marvel at it hanging in your living room. Note that it's different when it is owned by a company or a trust, in which case the capital gain could be deemed as income.
Returns on investment
Although Hundt is confident about the art market's expecting, on average, returns of between 10% and 15% for good works, he says this isn't set in stone as expected returns are hard to predict. He says leaving an art investment to your children is an ideal way to transfer wealth without impairing investment -- inherited artwork often becomes a substantial store of wealth. But inheritors naturally need to care for the work in question: it could conceivably lose its colour, or mould could grow on the paper. Work that's inappropriately mounted means that the acid mounting has all but destroyed the integrity of the paper, making the work valueless.
Hundt's final advice is to have the work valued from time to time, like any other asset, as it forms part of a personal estate.
* Hundt has been the curator of the Sanlam Art Collection since 1997. The collection boasts a representative overview of South African art valued conservatively at R128-million.
Source: Mail & Guardian Online Web Address: http://www.mg.co.za/article/2011-03-31-what-a-firsttime-art-investor-needs-to-know
Wednesday, July 6, 2011
Mail & Guardian Smart Money article
How the new carbon tax will affect you
FIONA ZERBST JOHANNESBURG, SOUTH AFRICA - Aug 20 2010 16:23
The already struggling motor industry will be dealt a blow on September 1 when the new C0² vehicle emissions tax comes into effect. And the bad news is that the consumer will be absorbing the costs.
In effect, the tax will be charged on all new cars and light commercial vehicles. Buyers will pay R75 for each g/km of C0² emissions above a threshold of 120g/km, the lowest threshold in the world. The price hike? About 2,5%.
In the case of higher fuel consumption vehicles, the tax and the price effect could be as high as 6%. So the tax burden amounts to about R1,6-billion a year, in respect of new cars. A further R800-million taxes in respect of light commercial vehicles is also anticipated.
To put that in real terms, it will theoretically add:
- R525 to a Yaris T1 1.0 3-dr MY 08 -- ( C0² emission is 127, so you calculate the cost in terms of however many grams over 120 x R75).
- R3 675 to a Corolla 1.8 Advanced MY09 ( C0² emission is 169).
- R5 250 to a Mercedes Benz B200 Turbo MPV MY08 ( C0² emission is 190).
The tax regime, originally applying to new passenger cars, has been extended to include light commercial vehicles -- though minibus taxis are exempt. South Africa is the first and only country in the world to introduce this tax on light commercial vehicles.
The tax is ostensibly being introduced to offset carbon emissions and encourage road-users to buy smaller, more fuel-efficient vehicles.
All well and good, but the knock-on effect may be quite different, as consumers resist buying news cars. And our fuel quality hardly meets international standards, as it is -- local low sulphur diesel contains 50 parts per million (0.005% sulphur), but in Europe even 10 parts per million is not considered clean.
Locally produced petrol is also emission-unfriendly, sitting at Euro 3 standard, while modern fuel and emission efficient engines are rated to use Euro 4, 5 or 6 standard petrols, preventing them from being supplied to South Africa.
So how are we achieving a green objective by slapping a one-off tax on motorists?
"This is an ad valorem tax, so it will be part of the price of the car," says Tony Twine, senior economist at Econometrix. "This will escalate, as you will pay VAT on it, and the ad valorem duty will be applied to the car at factory gate, with a dealer margin added to that.
So the retail price will escalate by more than the tax, while the tax will be invisible to the purchaser, defeating any attempt to sensitise car and LCV buyers to the vehicle's emission levels.
No data available
Worryingly, there is no data available with regard to the C0² emissions of light commercial vehicles, so it will be hard to explain to buyers just where these figures are coming from. No details as to how this tax has been calculated have been given to car dealers and it is unclear what this tax will be used for.
If it is not being earmarked for green investments, it will simply go straight into the fiscus, propping up tax collection in a falling tax revenue environment.
Gary Ronald, head of public affairs at the Automobile Association (AA), has this to say: "Government has not given an assurance that this tax will be set aside for green investments -- it has said 'where possible' the money will be allocated in this way, but that is not specific enough. It should be ring-fenced -- say, to subsidise filters and scrubbers, or wind-farms, or something consumers will approve of.
"We also feel that this tax is not equitable -- why a carbon tax on new vehicles when you could simply introduce cleaner fuels? And what about checking annual tail-pipe emissions? That was supposed to be introduced in terms of the Clean Air Act, but nothing was done.
"The AA has strongly advised that the government introduces an abbreviated safety check alongside testing for carbon emissions on all vehicles to improve the standard of roadworthiness."
The consumer as fall guy
Roadworx's motoring expert, Adrian Burford, says: "The consumer is the fall guy as manufacturers must recover costs from dealers, and dealers will have to recover costs from the consumer. You're looking at a good R15 000 to R16 000 being added to your retail price if you're buying a car with a seriously big and powerful engine."
Twine believes that the tax is being introduced now to show that South Africa is compliant with green legislation, making the country an attractive destination for climate-change events.
Clean-up economics makes us credible in the eyes of the international community -- as the Kyoto Protocol expires, South Africa will host a conference, probably in Durban, that may reach an international agreement that will replace the Kyoto protocol. That would be a huge diplomatic feather in the South African government's cap. After all, we held the world summit on sustainable development in 2002.
Burford recommends that the consumer, lacking breathing room, should try to find some creative solutions to the problem. "Maybe you're a Corolla family and you now have to find a Yaris-sized car," he says. "If you struggle to accommodate your family and your luggage, you may have to look at, say, a Thule roof-box, to improve carrying capacity. That's one way around the problem."
The tax may be a one-off cost, but that cost is substantial, so the consumer may simply be unable to get the necessary financing.
And that will be bad news for the economy, as car sales have been nowhere near as good as they were a few years ago. The impact on employment may be significant, as an added tax burden of about R2,5-billion on consumers will depress sales and affect the vehicle and component manufacturing industries.
* First published on Mail & Guardian's Smart Money site on 20 August 2010.
Ovid's Metamorphosis choreographed
Meta/physical
Posted on November 1st 2008
Ted Hughes's muscular versions of Ovid's Metamorphosis poems brought this mythological Latin poem of strange, magical transformation to a new generation of readers. Now Belgian choreographer Frederic Flamand and Brazilian design duo Humberto and Fernando Campana have given the extended series of poems new life on the stage.
Combining elements of dance, architecture and digital imagery, with the Ballet National de Marseille at centre stage, the theatrical performance unfolds 75 minutes of chaos, birth and change. The dancers enact the transformation of mortals into plants, gods into beasts, and heroes into rocks.
From the early movements of the tentative unfolding of the cosmos to the coronation of Julius Caesar, who is turned into a star, the tragic, spectacular, frightening and poignant stories are lovingly recreated.
The Campana Brothers bring their visual and design flair to the sets and costumes, drawing on Brazilian street life and carnival culture, and using found and recycled materials for inspiration.
Circular, multidimensional and suspended sculptures provide a backdrop, as do the floating film projection screens. An eclectic mix of musical styles and pieces completes the kaleidoscopic picture, which is a triumph of design and visual poetry.
* Published in Design Indaba magazine Q408: Macronutrients.
My review of The 2009 Flux Trend Review
Futures to believe in
Posted on February 1st 2009
Fashion guru-turned-trend analyst Dion Chang has put together a series of essays on the way the world will be very soon in The 2009 Flux Trend Review. In the preface, Chang observes that 2008 was a difficult year to learn from. As a result he predicts that the younger generation will come to demand more action as styles of global leadership change, environmental issues move to the foreground of our consciousness and consumers become less passive.
The book is divided into two sections – a corporate review and a lifestyle review. Each essay is written by an expert in his or her field – Justice Malala, Ferial Haffajee, Toby Shapshak and Brian Steinhobel, to name just a few.
The corporate review looks at politics, the economy, healthcare and related matters and is in general very solid, with one exception: Edwin de Lange’s frankly bizarre essay on “faithmentalism”, which suggests that religion accommodate advertising opportunities as it is a “brand” in itself. To stuff one of the few remaining quiet spaces in human experience with jingles and inane messages is, in my book, plain Orwellian. This essay should have been omitted.
The lifestyle review is serious fun, from contemplations on the decline of gastroporn and luxury brands to the rise of compressed leisure, entrepreneurial societies and spirituality in the digital age. These well-researched essays are easy to read and easy to digest. In fact, there’s a lot to nibble on here, for anyone interested in a taste of the future.
International trend forecaster Li Edelkoort has said, “People think I am some mystic or gypsy. But what I really do is pay attention. Then I have the nerve to say what I believe.” Chang has amassed essays by people who pay attention and write what they believe. The result is a digest that will hopefully come out annually and tell us what we should be focusing our attention on. In the end, it’s the things we pay attention to that we act on.
Interviewing Marian Bantjes
A spoonful of sugar
Posted on February 1st 2009
Whimsical, feisty and just plain beautiful, Marian Bantjes’s work has escaped the confines and conventions of style and genre, unfurling like a long, gorgeous ribbon, among many strands of visual communication.
With a solid background in typography and illustration, and loads of experience in design, Bantjes has taken her work from an island off the west coast of Canada to the global stage. And we are the richer for it.
Born in 1963, Bantjes began her career in visual communication as a book typesetter for 10 years (from 1984 to 1994). From 1994 to 2003, she worked as a partner and senior designer at Digitopolis in Vancouver, creating designs for corporates as well as educational and artistic organisations. In 2003, she went solo in order to pursue her own projects and ot od since then that she has come into her own.
Labels one wants to stick to her tend to slip off. As a visual designer, she has tackled a variety of media and multiple projects. Most often praised for her delicate handwork and ornamental style, her work is personal, fluid, looping and intense. Working in vector art, glitter, fur, ink, oil, dirt, sugar, pencil, watercolour and more, Bantjes is following her bliss – carefully, obsessively and exquisitely.
Fiona Zerbst: What techniques and formal values have you learnt from typography? How has it formed your style?
Marian Bantjes: Possibly too many to accurately list: when you know something really well, it’s hard to define or quantify what you know. But I am aware of the influence of structure on my work.
As a typesetter, 20 years ago, I worked on books, which is a very structured, rule-bound environment. That carries through to my work today, though it’s not always evident. Also, just knowing quite a bit about letterforms – although this is something I still consider myself weak on – has helped make my work be... well… a lot less sloppy than that of many other people’s.
Your influences seem to be predominantly those people, objects, buildings and artists that have surface as an independent value. How important is surface and the techniques that make it up?
I am an image maker. That is, as opposed to a “conceptual” designer, or someone who relies on process or the user experience as an interactive thing. So, in that sense I’m all about the image/the surface.
But within that there is often a complexity that goes beyond the immediate image. I like to make things that need to be figured out or pondered in some way. As such, there is some kind of intended “experience” that goes beyond the first impression.
On what basis do you choose your projects? You seem to have the luxury of choice, which is always nice. So where do you start?
It comes and goes. Sometimes I just accept everything, but then I start running into trouble: maybe the clients are asking for something I don’t want to give, or maybe we’re not communicating well, or maybe I’ve taken on too much and I get tired... and then I switch and reject everything.
I’ve come to recognise the signs of the good and the bad. Good projects come from people whom I know and trust (such as Michael Bierut at Pentagram or Stefan Sagmeister), or which are fairly open in the brief.
I look for people who are hiring me for something new and unexpected. People who are willing to trust that I can figure it out and make the right decision. These people will give me little to no direction. On the opposite end, I am increasingly wary of people who say they like my “style” (which one would that be, I wonder). I’m nervous about those who send me selected images from my website for direction, and I outright reject anyone who sends me images of someone else’s work.
I prefer people who tell me what their budget is up front, and like them even more if it’s a healthy sum – though I will trade a smaller budget for creative freedom provided it’s not advertising or a large client. I know when people have the money and I get very pissed off when ad agencies or well-known brands approach me with small budgets! I’m prejudiced against Canadians and Canadian companies (I very seldom work for people in my own country).
These days, I’m in a difficult space because I outright reject almost anyone who asks for anything pretty or swirly. It doesn’t mean I’ll never do it again, it just means I’ll only do it if I decide I can find an interesting way of doing it. Mostly I hate to be bored, and repeating myself is usually boring, which is why I really need people who are willing to take a leap of faith with me.
Which are your favourite materials to work in, if you had to choose?
I can’t say. It depends on what I’m doing, what effect I’m trying to get – and I’m always trying new things. I really don’t have a favourite. But if I was stuck on a desert island, I’d die without a pencil.
What has been your most satisfying project to date?
Well, I think my best work is the Sustainability poster, which was done over a year ago. The Design Ignites Change poster was also very satisfying – maybe even more so than Sustainability, as the proceeds went to a good cause. And of course the Creative Review monograph, Love Stories, was very satisfying because it was all personal work.
* Published in Design Indaba magazine Q109: The Cr*ft
Paying homage to the Tesla Roadster
Electric avenue
Posted on August 1st 2007
With the demand for reduced carbon emissions coupled with the challenge of design innovation, the motor industry has simultaneously given the electric car a face-lift and a new lease on life.
So is there a swing back to "electric"?
Tesla Motors is banking on it, with its ultra-sporty, energy efficient Roadster. The two-seater Roadster, fresh out of Silicon Valley, is now on sale. The first 100 Roadsters were pre-ordered in three weeks, making this baby the sexy "must-have" of the quarter.
It made Time magazine's list of top inventions for 2006 and is now close to hitting the road.
The Roadster's birth marks an interesting juncture in the growth chart of electric cars. For one thing, it's not a prototype, unlike the Lightning and the Wrightspeed X1. It is powered entirely by lithium-ion batteries (the same battery that drives most laptops and cellphones); and it can clock 0 to 60 mph in four seconds, scotching fears that it may be underpowered. The lithium-ion batteries are expected to last about 100 000 miles or more and pack replacement would likely be equivalent to engine replacement, in terms of timing and possible cost.
The Roadster's battery technology and software are held to be superior, and excellent performance is assured by Tesla. Curiously, the Roadster has been built on the chassis of a Lotus Elise, though the Elise's reputation for good handling on the road probably explains the decision.
At about $100 000, the vehicle's price is probably too steep for most of us, but if you have a little squirreled away in the bank, you could invest in the future of motoring. At this stage, though, you'll probably need to drive it in California, Chicago, New York City or Miami, where you can expect support and service. Beyond that, you'll be paying heavy premiums for transportation, for one thing. So the Roadster is very much for the United States market – for now.
The shape of things to come
Tesla is confident that the Roadster is the shape of things to come. Interestingly, its sheer functionality augurs well for more affordable electric vehicles that cater for the mainstream market.
Tesla itself is an interesting company. Funded by South African Elon Musk, of PayPal fame, and founded by CEO Martin Eberhard, a technical guru, Tesla's aim was to combine entrepreneurial savvy with design wizardry while producing a superior vehicle for the road: A beautiful, high-performance vehicle for the green generation.
Future vehicles from Tesla are predicted. Indeed, Fortune magazine recently revealed that a family-friendly, four-door sedan is scheduled for production in 2009. This car will cost half of what the Roadster costs, despite being, well, bigger.
Detractors have suggested that the Roadster and cars of its ilk are more "hobby horse" than functional vehicle, largely because of the price tag. But Tesla genuinely wants to popularise the electric vehicle, suggesting that its first vehicle was a high-end sports car only to "capture the imagination of people as to the possibilities of EVs".
"To build the kind of electric car that I personally would like to drive is really why I started," Eberhard told Jon Alain Guzik in an online interview recently.
Musk suggests that Tesla will succeed in its aims as hybrid cars have already become popular due to rising petrol prices and fears concerning global warming. The next step is going electric, as consumers will want cleaner vehicles that are cheaper to run in the long term, while still being eye-catching on the road.
It's worth noting that electric cars aren't entirely pollution-free. They can't claim to be "zero-emission" vehicles. Still, they're said to produce half the carbon dioxide per mile of a hybrid car, which makes them cleaner than any other vehicles on the road. Also, seeing as the emissions are at the power plant, sustainable energy sources and carbon sequestering become viable alternatives.
General Motors was one of the first companies to pursue – or revive – the electric dream in 1996, in the form of the EV1. GM leased 800 EV1s and counted Tom Hanks and Mel Gibson among the vehicle's fans. But even the celebrity support couldn't win the battle and the vehicle was discontinued, ostensibly due to lack of consumer demand. The documentary Who Killed the Electric Car? claims that the oil lobby, motor manufacturers and weak regulators were unwilling to entertain the dominance of the electric car, so ending the "electric dream" in California. But not everyone believes a conspiracy was afoot, suggesting that battery technology was unsophisticated and problematic.
This problem is unlikely to beset the electric car now. With more vehicles in the pipeline, including the eBox, Phoenix Motorcars's sports utility truck (SUT), ZAP-X, Tango, Th!nk and General Motors's Chevrolet Volt sedan, electric is making a comeback, albeit in slow and experimental stages.
Celebrities are once again behind the experiment, with Condoleezza Rice and Arnold Schwarzenegger praising the Roadster's look and, above all, performance (Rice calls it "a little rocket ship").
Time will tell whether the electric car becomes the vehicle of choice for global consumers. In the meantime, it's worth watching their designers' dreams taking shape.
* Published in Design Indaba magazine Q307: Green Living: The Burning Issue
Wednesday, June 30, 2010
My Alexandra Fuller interview, Fairlady magazine
Meet Alexandra Fuller
We talk to the author of: Don't Let's Go to the Dogs Tonight, Scribbling the Cat, and The Legend of Colton H. Bryant.
By Fiona Zerbst
Alexandra Fuller says she wanted to write ‘as soon as I could hold a pencil’. Telling stories – her own and other people’s – propelled her into non-fiction, beginning with her memoir of her African childhood, Don’t Let’s Go to the Dogs Tonight, followed by Scribbling the Cat: Travels with an African Soldier and her latest, a hybrid of biography, eco-politics and poetic tribute, The Legend of Colton H. Bryant. Set in Wyoming, where Fuller now lives with her husband and three children, the book traces the all-too-brief life of an engaging ‘redneck’, Colton Bryant, whom we first meet as a bullied eight-year-old shaking off cries of ‘retard’ with the mantra, ‘Mind Over Matter. I don’t mind so it don’t matter.’
On Wyoming
Wyoming is tough, and the gritty poetry of place is rendered beautifully. Colton is an engaging mix of toughness, fire and innocence – but on the oil rigs, where production is everything and safety not a concern, he’s ‘just another redneck’. This drove Fuller to write the book. ‘Wyoming not only has the highest rate of worker fatalities in the nation, but we also have the highest percentage of rig deaths, and oil and gas companies in Wyoming are protected from lawsuits brought by maimed rednecks or the families of dead or maimed rednecks,’ Fuller explains. ‘The fines imposed on drilling companies for safety violations are pathetic.’ It’s this passion for people, environment and accurate observation that has made Fuller one of the most risk-taking writers around.
'I felt like a traitor...'
Charting the often agonising experiences of her family’s years in then Rhodesia, Malawi and Zambia, Fuller has an unflinching gaze and an uncompromising way with language. Her family was hardly overjoyed by the revelations, but she regards Don’t Let’s Go to the Dogs Tonight as a loving memorial – which, in a sense, it is, despite the frailties uncovered. ‘I felt like a traitor to my family, the people who had raised me,’ she confesses. ‘It was awful. I think it hurt my mother terribly, and I never intended to hurt her, and I think it embarrassed my father and sister. I’m glad i did it – but I don’t think I would have done it if I’d known what the consequences would be.’
On writing The Legend
The Legend of Colton H. Bryant is the result of Fuller’s working closely with Colton’s parents, Bill and Kaylee, and the rest of his family. She says she initially intended to write a book about the oil boom in Wyoming and its social consequences (Wyoming also has one of the highest suicide rates in the US), but Colton became the focal point. ‘Kaylee and Bill started to tell me about Colton, how he had been born going 70 miles an hour in a 1976 Ford thunderbird and how he had been in a rush ever since. There were all the Colton stories, these truly incredible, made-for-a-book stories – and I think fairly soon I realised that I wanted to write about Colton and no one else,’ she says.
Though Colton’s fate is hardly unique, he is anything but a statistic. Fuller makes you fall in love with him – his gentleness, his quirky cowboy sayings, his old-fashioned uprightness. It’s a loving portrait of a soul crushed by the heartlessness of what Fuller calls ‘America’s violent and unsustainable energy policy...’. ‘I wanted [the book] to read like a novel, so that people actually felt Colton in their hearts, and felt the pain of losing him,’ she says.
The result is an authentic portrait of a part of a community Fuller says is not far removed from the white Zimbabweans who raised her – ‘tough, hospitable, sometimes closed-minded, pragmatic, self-defeating, suspicious of change and utterly attached to land and place. ‘Maybe it just shows you that people who live in remote places, love land and are frightened of change aren’t so dissimilar from one continent to the next,’ she concludes.
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