Savvy Art Collecting Shames Stock Picking, Even Venture Capital Returns

Eva Hesse’s art, mainly sculpture, embraced surrealism, minimalism and conceptualism in a poetic manner. So goes the stock market, without the poetry. Hesse’s work balanced order and disorder, opacity and translucency, transience and permanence.

In Hesse’s words “I wanted to get to non-art, non-connotative, non-anthropomorphic, non-geometric, non-nothing, everything but another kind, vision"...

Her conceptualism is typified by this rope, string, wire latex construction, untitled, created in 1969, amorphous, hovering between something and nothing. When I first saw this piece, it hit me as a priceless metaphor for what I do, what the investment world is all about—a force you can never pin down, chaotic and impermanent but never whimsical.

My bourgeois sensitivities prevailed back in 1970, so I passed on Hesse’s work as too impermanent. Rope and latex wouldn’t last forever like a Rembrandt canvas or even a slapdash piece by Andy Warhol. Nicolas Logsdale, the London dealer whose Lisson Gallery showed comparable work at the margin, like Lawrence Weiner’s walls stenciled with catchy phrases that resonated for onlookers.

Nicolas braced me once, pointing out that you could always repair Hesse’s rope and nobody would know the difference. It wouldn’t detract from the permanence of the piece’s conceptual power. This is unlikely in the stock market. When a property deteriorates, it hardly ever comes back.

Maybe a decade or so ago, my inventory of contemporary art surged past my securities portfolio valuation. I didn’t plan it so, but being early on and right, buying canvasses of emerging artists, put away even venture capital plays yielding 100-to-1 on initial investments.

Consider, buying Jackson Pollock’s work in 1951, or a Basquiat in 1982, for $1,000 apiece. Today you’d find such work going for $100 million . At auction, iconic pieces are fought over by Russian and Chinese honchos who do no homework. They won’t trust art dealers, so vie at auctions against their contemporaries in the corporate world where they’re comfortable.

Sheer insanity, but so is paying up for Apple, Facebook, Alphabet, Amazon—all trillion dollar capitalizations. At least there’s liquidity. It could take months finding a buyer for a fading artist’s canvas, even at a steep markdown.

Seasoned investors construe stocks abstractly. Decades ago, Warren Buffett saw newspapers as monopolies in dominant urban markets. I saw Boeing in 1960 as a preeminent packager of airline seats in the jet age. Both concepts prevailed for decades. Then, Internet transmission diminished the monopoly hold of newspaper publishers. Boeing’s 737 MAX aircraft proved faulty and lethal. As a stock, precrash, Boeing had $500 written all over it, but now trades closer to $200.

Sadly, nothing is forever. Over 30 years, Eva Hesse’s latex rope sculptures changed for the worse. They lost their flexibility, discolored and stretched from gravity’s pull. The time-based phenomena of variability and instability again prevailed, like a deteriorating stock market setting, analogous to the impact of Covid-19.

I perceived that Hesse’s use of rope was a surrogate for the line. Suddenly I saw biomorphic images like hanging breasts and testicles. Hesse’s rope pieces turned into erotic experiences comparable with my early discovery of Apple and Facebook. Fresco work like “The Last Supper” has faded, but nobody seems to care or even notice. Always exceptions.

Great art never loses its glow. When you enter MOMA’s room of Jackson Pollack drip paintings, you’ll be amazed by their glow. Thereby, Pollack structured chaos into non-chaos, what you try to do as an investor. In the financial meltdown of 2008-’09, once I understood banks could raise tens of billions in new capital, it made their preferred stocks trading at 5 bucks prospectively worth their $25 face value . Go! Bank of America.

Eva Hesse, at 30 years old, gained full recognition as an artist with something to say. Hesse believed in letting her materials find their own configuration. The work is never finished like a canvas is finished or packaged. Then, Eva developed a brain tumor at 33 and succumbed after 3 operations. In this instance, her art of empathy where form breaks down foreshadowed her terminal illness. What bad luck when your life imitates your art works! Consider, Steve Jobs cavalierly deferred medical attention and thereby succumbed prematurely despite all his power as a great entrepreneur.

Hesse’s rope pieces incorporate 2 investment themes. First, seriality or repetition as a way of avoiding subjectively. When I bought my ragamuffins spring of 2020—Freeport McMoRan, Alcoa, U. S. Steel and Halliburton. I wasn’t individuating stocks, but embracing a concept. Then, they gave away cyclicals with enormous latent earnings power. Likewise, Andy Warhol’s Coca-Cola bottles embraced seriality and repetition to forge powerful images.