Soviet The Reason Why

[slava1stclass]

To all:

Soviet ODM prices continue to explode for exactly the same reasons.

Regards,

slava1stclass

A Rich Market for Russian Icons

As Tycoons Reclaim National Treasures, Counterfeiters Also Emerge

By Peter Finn

Washington Post Foreign Service

Tuesday, February 5, 2008; Page A15

MOSCOW -- Last May, Maria Paphiti, an icons specialist at Christie's auction house in London, was invited to inspect some religious paintings on wood that were among the contents of a building recently bought by an English family. The artworks had been found wrapped in plastic, and the building's new owners wondered what, if anything, they were worth.

The answer: a lot, particularly if they drew the attention of Russian buyers who have embarked on a massive spending spree to recover the country's exiled treasures.

Paphiti quickly singled out one piece as quite valuable. The 1894 icon "St. Nicholas the Miracle Worker of Myra" had a rare signature by the acclaimed Russian icon painter Mikhail Dikarev. It had also been framed in gilt and enamel by Jakov Mischukov, a well-known Moscow craftsman.

Adding to the icon's value was a dedication on the back saying it had been presented to the last czar, Nicholas II, by the Old Believers community, which broke with the established Russian Orthodox Church in the 17th century over changes to the church's rites.

How the icon got to London, only to be discarded in an obscure building, remains a mystery, Paphiti said.

The icon was put on the block last June 11. Bidding started slowly at 20,000 pounds, or almost $40,000 -- Christie's pre-sale estimate. An impatient Russian bidder quickly stepped in with an offer of $200,000 and then two bidders, both unidentified Russians, faced off in bids made by intermediaries over the phone until the icon was sold to one of them for $854,000, a world record for an icon at auction.

For the happily bewildered English family, who told Christie's they wished to remain anonymous, it was an astonishing windfall. "They couldn't believe it," Paphiti said in a telephone interview from London.

The sale was new evidence that the market for Russian icons is skyrocketing. Fueled by religious patriotism and encouraged by both the Kremlin and the Russian Orthodox Church, Russia's tycoons are reclaiming masterpieces that were scattered worldwide by the chaos of the Russian Revolution, the flight into exile of those opposed to the Communists, and the illegal export of art, which continued into the 1990s.

Russians are spending hundreds of millions of dollars to reacquire all kinds of Russian art, not just icons. To help the process, the government has eliminated customs duties on the import of art. The market is so good that con artists are occasionally getting into the act with fakes.

In recent years, the billionaire oils and metals tycoon Viktor Vekselberg acquired the 180-piece Forbes collection of Faberge eggs for $100 million and put them on exhibit here. In September, the steel magnate Alisher Usmanov spent $40 million to buy the art collection of the late cellist and conductor Mstislav Rostropovich, then promptly turned it over to the state as a gift.

At Christie's, sales of icons and religious artifacts have jumped from $140,000 in 2005 to $14 million last year, and 70 percent of the buyers are Russian, according to Paphiti. Both Christie's and Sotheby's are reporting tens of millions of dollars in annual sales of Russian art.

"A patriotic wave has appeared in Russia," said Mikhail Elizavetin, 68, who made his fortune in construction and now has one of Russia's finest private collections of icons. "There is a pride in returning these icons to their motherland. I'm not talking about speculation in icons, I'm talking about real national pride. Many people have a sincere, pure reaction to this kind of art."

Four months ago, Elizavetin said in an interview, he paid a private collector in Switzerland nearly $1.5 million for a 14th-century icon called "Descent into Hell." Six months ago in Berlin, he said, he acquired an entire private collection of 110 icons for what he described as "considerable millions."

Prices of icons are doubling and tripling each year.

"It's fantastic," said Vladimir Studenikin, a Moscow dealer who makes regular trips to London to bid at auctions for himself and private Russian buyers.

The booming market has also spawned skilled counterfeiters who retouch primitive but old icons to make them seem like masterpieces. Complicating matters is the fact that some apparently ancient icons are forgeries made in the late 19th and early 20th centuries -- a period when there was also a lively black market in counterfeiting. Distinguishing a 19th-century fake from a 14th-century original can be extraordinarily difficult, art experts say.

For some Russians, icons, particularly those that predate the early 17th century and are uninfluenced by Western motifs, are the truest form of Russian art. Icons made for the last czars and their families are also particularly valued. Their possession dovetails with a renewed sense of nationalism and religious identity among the elite of President Vladimir Putin's Russia.

"The soul of ancient Russia is expressed most clearly in an icon," said Nadejda Bekeneva, head of the Department of Ancient Art at the State Tretyakov Gallery. "It's a wonderful thing that our businessmen are returning our wealth to the motherland."

Mikhail Abramov, also a construction magnate, said he experienced a religious awakening three years ago when he turned 40 and had made his fortune. He began to collect icons, first for his home. Two years ago, when he had acquired nearly 400 of them, Abramov opened a private museum, a common move by Russian tycoons these days. (Elizavetin also is planning to open a private museum for his collection.)

"I get a lot of offers, but I believe I don't have a right to sell them," Abramov said. "They belong to Russia."

The Tretyakov will hold an exhibition of Elizavetin's and Abramov's collections next month. The show will be called "Returned Treasures."

[Christian Zulus]

Lost for the international market ...

Dear slava1stclass,

many thanks for posting that interesting article from the Post .

Concerning orders & medals:

Our Russian collectors are entitled to buy the awards and to re-import them to the Russian Federation, but they are not allowed to sell them outside of the Russian Federation anymore.

By presenting the bills to the RF-authorities, that he had legally purchased the orders at an auction or at a dealer in the west, the collector receives the right to be the legal owner of the items, to re-import them and he gets an official congratulation for his patriotic deed, but he is blocked to sell them (legally) again abroad.

So, all Soviet awards, which are going back to the RF are lost for the international market .

This aspect might also drive the prices to unbelievable heights ...

Best regards

Christian

[Ed_Haynes]

True. It is not just a siphoning of the market, but a partitioning of the market.

Part of me is glad to see these things going home, but part of me is bothered by the dead-end that that entails.

And I think Christian is right about what this means the market.

[Guest Rick Research]

Empty people with stolen billions trying to buy souls.

God is not mocked.

[Wild Card]

Agreed.

I think that, certainly on a long term basis, this partitioning of the market has more serious implications than the crazy prices which we have been seeing.

The crazy prices have been the result of basic supply and demand (Economics 101) recently run amok by an infusion on the demand side by new participants with unlimited funds who are, for the most part, motivated by ego. Now though, we are seeing the supply side being manipulated by this partitioning, which will limit supply to those outside of Russia.

At the same time, this does present an interesting scenario. I think that most of us will live to see the day when these new collectors will, for any of several reasons, choose to unload their collections. What then? First, they will be limited to other buyers within their closed market. Second, if one starts to unload, I suspect that others may follow. If one goes and they all go, there will not be anyone around to pay the prices on the way out that they paid on the way in - just us poor (real) collectors in the west. To quote the response of a well known dealer when I put this situation to him - ?It won?t be pretty.?

I should add for clarification that by what I see as a generally accepted standard among Forum members, there are are many ?real? collectors in Russia; I do not mean to paint all with the same brush.

A word of advice to the Russian collectors who are driving these prices - Keep your collections at your chalets in Switzerland.

[Christian Zulus]

Gentlemen,

due to the fact, that we are now confronted with a new wave of patriotism and a new view on history in Russia, what puts the precious relicts of the GPW and "Golden Age" of the 1930s & 1940s of the CCCP in a mystic aura, the home demand for Soviet awards will keep on growing.

Have a look at the (closed) thread about Stalin in coming Russian history books: http://gmic.co.uk/index.php?showtopic=24212 .

We might be also confronted with a so called "band wagon effect": First the Oligarchs (and/or their managers and advisers) are buying the ultra high end orders. Then the new "middle class" is buying the more common and mid-priced items. At the end the "masses" might run for all the medals, badges etc.

Another cause for rising prices might be in the near future the increasing demand from China - many people are living there and there is already a lot of money in that country.

I guess, that as long as the Russian economy keeps booming, the demand for Soviet awards will increase.

The fact is, that collecting Soviet awards in Russia seems to be now very fashionable and patriotic at the same time. Buying a Bentley is fashionable in Moscow. But to buy for the same amount of money a Suvorv 1cl is fashionable and patriotic.

Best regards

Christian

BTW: It might be, that Austria has even more of these chalets ...

A word of advice to the Russian collectors who are driving these prices - Keep your collections at your chalets in Switzerland.

[Wild Card]

And some very beautiful ones (chalets) too; but it?s those Swiss Banks that are the real draw.

Thank you for your enlightening analysis regarding the new wave of patriotism as being a factor with collecting in Russia. It is both interesting and encouraging. One cannot criticize such a reason. I suspect that this is a motivating factor with the majority of collectors from all countries.

Wild Card

Edited February 7, 2008 by Wild Card

[slava1stclass]

To all:

Yet further confirmation why the prices of Soviet ODM will not be coming down anytime soon.

Regards,

slava1stclass

World's Most Expensive Cities

In 1998, Moscow was in crisis. More than 100,000 Russians took to the streets as a slew of banks ? and the life savings of millions of citizens ? went bust.

But just a decade later, the global commodities boom has made Russia flush with cash, and Moscow has become a pricey place to live.

That's the finding in Mercer's 2008 Worldwide Cost of Living Survey. Moscow tops the list with a score of 142.4, up 6% from last year ? and 42% higher than New York, the most expensive city in the United States. The Russian capital is followed by Tokyo; London; Oslo, Norway; and Seoul, South Korea.

As for Moscow, prices in the Russian capital show no signs of dropping. The global commodity boom continues to fatten the pockets of local tycoons, and the ruble has appreciated 8% against the dollar since January.

Moscow is home to 74 billionaires, the most of any city in the world. Its three wealthiest citizens (Oleg Deripaska, Vladimir Lisin and Roman Abramovich) each possess fortunes in excess of $25 billion. And Russia's super-wealthy are just getting started: 13 of the country's billionaires are under the age of 40.