Monet and Money

As consumers tighten their budgets and cope with a global economic downturn, the art world would be the last place one would expect to find a thriving market. Yet, even as house prices collapse, stocks plunge, and commodity prices spike, prominent art collectors are spending huge numbers of dollars on famous works of art.

"The international art market is extremely robust and now operating at levels we haven't seen for over 15 years," a Christie's spokesman, Rick Pike, told The New York Sun. A painting by Claude Monet, whose work serves as a bellwether for values in the art world, recently sold for $80 million, double the artist's previous record set only a month ago. And the same Monet that sold last month for $41 million sold for $12 million in 1988.

What accounts for these soaring values? Could the answer lie less with the rising reputation of Monet and more with the falling value of the greenback? In one sense, a dollar and a Monet really aren't that different. Both are intrinsically worthless pieces of paper or canvas made valuable by their association with, on the one hand, the American government, and, on the other hand, a visionary painter. So measuring the value of a Monet in terms of dollars tells you as much about the former as it does the latter.

The sale of Monet's "Waterlily Pond and Path by Water" in June 1998 set a record of 32.9 million one dollar Federal Reserve Notes. The sale of Monet's "Water Lily Pond" last week fetched 80 million pieces of one-dollar scrip from the Federal Reserve. But in terms of real value, the painting sold 10 years ago went for what at the time was 112,286 ounces of gold and the painting sold last week went for 85,333 ounces of gold, a plunge of 24%.

No two paintings are directly comparable, of course, even if they are by the same artist. But if the record values of Monet's paintings — and those of other artists — were measured in a currency that was managed according to gold, we would have a far better idea of whether the art market is actually booming or whether the value of the currency is simply sinking. Or whether the enduring qualities of a great painting are a mockery of the qualities of our monetary management in Washington.