Mei Moses Fine Art Index Down 4.5% for 2008

The Mei Moses Fine Art Index released its results for 2008, showing a drop of almost 4.5%. Given the current economic issues and late 2008 drop in prices, the 4.5% appears mild, but when compared to a 20% annual increase over the past 5 years, it is a rather steep decline.

The following is from the free based section of the Mei Moses website, the full report is available only to subscribers. To visit, click HERE. Michael Moses and Jianping Mei wrote an article for the Journal of Advanced Appraisal Studies entitled Market Based Art Valuations. To read an excerpt of that article, click HERE.

From the Mei Moses website on the 2008 art index report.

The 2008 decrease in the return of the all art index of almost 4.5 percent is the first time our all art index has declined after five years of positive annual growth averaging almost 20 percent. This result dramatically out-paced the 37 percent decrease in the S&P 500 total return index (where dividends are reinvested tax free) for 2008. The most recent five and ten year compound annual returns (CAR) for art, 11.7% and 9.5%, also exceed the returns of stocks, -2.2% and -1.4% respectively. However, both art and equities were outperformed by bonds, bills and gold in 2008. Art also outperformed bonds and bills during the five and ten year periods but all were outperformed by gold. Stocks outperformed art over the last twenty five years by a CAR of 1 percent but equities dismal performance in 2008 has caused the prior substantial outperformance of equities over this time period to shrink from a CAR of 5% to its current level. However, for the first time since the early 1990's art outperforms stocks over the last fifty years, with a CAR of 9.8% vs. 9.2% respectively.