sloth unleashed

In the last few days, we’ve seen an extraordinary wave of announcements by governments in Europe, particularly its eastern part, that they would not be ratifying ACTA immediately. That sequence of events, culminating in today’s news that Germany, too, would be holding off, has suddenly made lots of people sit up and take notice.

But even against that tumultuous background, few of us would have expected that two of the most serious business publications in Europe, The Economist and Financial Times, would both go much further than simply noting the problems the treaty now faces, and declare that ACTA is pretty much dead…

The art market defied the economic gloom to return 11 per cent to investors in 2011, outpacing stock market returns for a second consecutive year.

The performance of the Mei Moses All Art index, a leading barometer of art returns based mainly on paintings sold in New York and London, beat the total return of the S&P 500 index of US equities by about 9 percentage points. The gap, the largest since 2008, was driven by strong growth in Chinese demand and high prices for the work of popular artists such as Andy Warhol.

The Mei Moses has beaten the S&P 500 in six of the last 10 years, with an average annual return of 7.8 per cent compared with 2.7 per cent for the benchmark US index. The Mei Moses tracks the prices at which individual works of art sell over time using repeat sales data, in a methodology similar to the S&P Case-Shiller property index.

“Art prices are not correlated to sudden swings in stock markets but their prices tend to match changes in wealth creation and destruction. I’m not surprised by this growth as we are not seeing the wealth damage of 2008-2009,” said Michael Moses, creator of the index…