Global Art Market Soars 29% In 2021
Kanebridge News
    HOUSE MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $1,436,707 (+0.82%)       Melbourne $958,938 (-0.18%)       Brisbane $805,276 (+0.20%)       Adelaide $743,261 (+0.57%)       Perth $641,111 (+1.35%)       Hobart $739,768 (-1.32%)       Darwin $641,804 (-0.09%)       Canberra $971,787 (-1.13%)       National $936,660 (+0.16%)                UNIT MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $694,570 (-0.33%)       Melbourne $471,297 (-0.44%)       Brisbane $430,588 (-1.62%)       Adelaide $353,294 (-0.18%)       Perth $357,545 (+0.46%)       Hobart $558,931 (+4.60%)       Darwin $356,380 (-2.21%)       Canberra $476,932 (+0.93%)       National $489,111 (+0.53%)                HOUSES FOR SALE AND WEEKLY CHANGE     Sydney 10,093 (-72)       Melbourne 13,872 (+186)       Brisbane 10,770 (+38)       Adelaide 3,078 (+82)       Perth 9,971 (+180)       Hobart 911 (+13)       Darwin 300 (-7)       Canberra 996 (+8)       National 49,991 (+428)                UNITS FOR SALE AND WEEKLY CHANGE     Sydney 8,400 (-137)       Melbourne 7,842 (-9)       Brisbane 2,243 (-20)       Adelaide 542 (+7)       Perth 2,413 (+1)       Hobart 156 (+3)       Darwin 371 (-4)       Canberra 529 (+5)       National 22,496 (-154)                HOUSE MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $660 (+$10)       Melbourne $500 (+$10)       Brisbane $560 (+$10)       Adelaide $510 (+$10)       Perth $550 ($0)       Hobart $550 ($0)       Darwin $650 (+$25)       Canberra $700 (+$5)       National $593 (+$9)                UNIT MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $600 ($0)       Melbourne $450 (+$5)       Brisbane $500 ($0)       Adelaide $403 (+$3)       Perth $470 ($0)       Hobart $473 (-$3)       Darwin $550 ($0)       Canberra $560 ($0)       National $508 (+$)                HOUSES FOR RENT AND WEEKLY CHANGE     Sydney 6,525 (+243)       Melbourne 7,106 (-5)       Brisbane 3,920 (+102)       Adelaide 1,146 (+39)       Perth 1,623 (+85)       Hobart 243 (+11)       Darwin 102 (-7)       Canberra 588 (+44)       National 21,253 (+512)                UNITS FOR RENT AND WEEKLY CHANGE     Sydney 8,070 (+376)       Melbourne 5,906 (+117)       Brisbane 1,516 (+27)       Adelaide 327 (+5)       Perth 673 (-3)       Hobart 86 (+5)       Darwin 232 (+7)       Canberra 662 (+66)       National 17,472 (+600)                HOUSE ANNUAL GROSS YIELDS AND TREND       Sydney 2.39% (↑)      Melbourne 2.71% (↑)      Brisbane 3.62% (↑)      Adelaide 3.57% (↑)        Perth 4.46% (↓)     Hobart 3.87% (↑)      Darwin 5.27% (↑)      Canberra 3.75% (↑)      National 3.29% (↑)             UNIT ANNUAL GROSS YIELDS AND TREND       Sydney 4.49% (↑)      Melbourne 4.97% (↑)      Brisbane 6.04% (↑)      Adelaide 5.92% (↑)        Perth 6.84% (↓)       Hobart 4.40% (↓)     Darwin 8.03% (↑)        Canberra 6.11% (↓)       National 5.40% (↓)            HOUSE RENTAL VACANCY RATES AND TREND       Sydney 1.6% (↑)      Melbourne 1.8% (↑)      Brisbane 0.5% (↑)      Adelaide 0.5% (↑)      Perth 1.0% (↑)      Hobart 0.9% (↑)      Darwin 1.1% (↑)      Canberra 0.5% (↑)      National 1.2%    (↑)             UNIT RENTAL VACANCY RATES AND TREND       Sydney 2.3% (↑)      Melbourne 2.8% (↑)      Brisbane 1.2% (↑)      Adelaide 0.7% (↑)      Perth 1.3% (↑)      Hobart 1.4% (↑)      Darwin 1.3% (↑)      Canberra 1.3% (↑)      National 2.1%   (↑)             AVERAGE DAYS TO SELL HOUSES AND TREND         Sydney 30.4 (↓)       Melbourne 29.7 (↓)       Brisbane 36.6 (↓)       Adelaide 25.3 (↓)     Perth 41.0 (↑)        Hobart 32.2 (↓)       Darwin 33.8 (↓)       Canberra 28.3 (↓)       National 32.2 (↓)            AVERAGE DAYS TO SELL UNITS AND TREND         Sydney 33.0 (↓)       Melbourne 30.1 (↓)       Brisbane 35.1 (↓)       Adelaide 29.4 (↓)     Perth 43.7 (↑)        Hobart 26.9 (↓)     Darwin 44.0 (↑)      Canberra 31.9 (↑)        National 34.3 (↓)           
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Global Art Market Soars 29% In 2021

Reaching $65 billion in sales.

By FANG BLOCK
Wed, Mar 30, 2022 11:31amGrey Clock 2 min

The global art market rebounded strongly in 2021 despite the challenges of the pandemic, according to a global art market report released Tuesday.

Aggregate sales, including sales by dealers and auction houses, jumped 29% from 2020 to an estimated US$65.1 billion last year, surpassing pre-pandemic levels in 2019, according to the annual report jointly published by Art Basel and UBS and authored by Clare McAndrew, founder of Dublin-based Arts Economics.

“The art market has demonstrated incredible resilience in 2021, with a strong uplift in aggregate sales, despite still operating under some very challenging conditions,” McAndrew said in the report. “Dealers and auction houses successfully adjusted to a new two-tier system of online and offline sales and events, and the rising wealth of the high-net-worth collectors helped to support demand at the higher end of the market.”

The median expenditure by high-net-worth individuals (HNWIs), those who have a net worth of more than US$1 million, excluding real estate and private business assets, reached US$274,000 in 2021, more than double the level in 2020, according to the report.

Further, 74% of HNWIs surveyed bought art-based non-fungible tokens, or NFTs in 2021, with a median price of US$9,000 each, the report said.

The findings are based on a survey of 2,339 wealthy individuals across 10 major markets, and represent one element of the wide-ranging report on the state of the global art market.

Sales by dealers amounted to approximately US$34.7 billion in 2021, increasing 18% year-on-year. Public sales by auction houses, excluding private sales, reached an estimated US$26.3 billion in 2021, an increase of 47% from a year ago, according to the report.

Geographically, the U.S. still dominates, accounting for US$28 billion, or 43% of the total global sales of art and antiques in 2021. Greater China was the second largest with a market share of 20%, or US$13.4 billion in sales.

Reprinted by permission of Penta. Copyright 2021 Dow Jones & Company. Inc. All Rights Reserved Worldwide. Original date of publication: March 29, 2022.

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How Crypto’s Collapse May Have Done the Economy a Favour

Crypto’s lack of connections with traditional finance means its problems haven’t spilled over to the economy

By GREG IP
Fri, Nov 25, 2022 4 min

This year’s crypto collapse has all the hallmarks of a classic banking crisis: runs, fire sales, contagion.

What it doesn’t have are banks.

Check out the bankruptcy filings of crypto platforms Voyager Digital Holdings Inc., Celsius Network LLC and FTX Trading Ltd. and hedge fund Three Arrows Capital, and you won’t find any banks listed among their largest creditors.

While bankruptcy filings aren’t entirely clear, they describe many of the largest creditors as customers or other crypto-related companies. Crypto companies, in other words, operate in a closed loop, deeply interconnected within that loop but with few apparent connections of significance to traditional finance. This explains how an asset class once worth roughly $3 trillion could lose 72% of its value, and prominent intermediaries could go bust, with no discernible spillovers to the financial system.

“Crypto space…is largely circular,” Yale University economist Gary Gorton and University of Michigan law professor Jeffery Zhang write in a forthcoming paper. “Once crypto banks obtain deposits from investors, these firms borrow, lend, and trade with themselves. They do not interact with firms connected to the real economy.”

A few years from now, things might have been different, given the intensifying pressure on regulators and bankers to embrace crypto. The crypto meltdown may have prevented that—and a much wider crisis.

Crypto has long been marketed as an unregulated, anonymous, frictionless, more accessible alternative to traditional banks and currencies. Yet its mushrooming ecosystem looks a lot like the banking system, accepting deposits and making loans. Messrs. Gorton and Zhang write, “Crypto lending platforms recreated banking all over again… if an entity engages in borrowing and lending, it is economically equivalent to a bank even if it’s not labeled as one.”

And just like the banking system, crypto is leveraged and interconnected, and thus vulnerable to debilitating runs and contagion. This year’s crisis began in May when TerraUSD, a purported stablecoin—i.e., a cryptocurrency that aimed to sustain a constant value against the dollar—collapsed as investors lost faith in its backing asset, a token called Luna. Rumours that Celsius had lost money on Terra and Luna led to a run on its deposits and in July Celsius filed for bankruptcy protection.

Three Arrows, a crypto hedge fund that had invested in Luna, had to liquidate. Losses on a loan to Three Arrows and contagion from Celsius forced Voyager into bankruptcy protection.

Meanwhile FTX’s trading affiliate Alameda Research and Voyager had lent to each other, and Alameda and Celsius also had exposure to each other. But it was the linkages between FTX and Alameda that were the two companies’ undoing. Like many platforms, FTX issued its own cryptocurrency, FTT. After this was revealed to be Alameda’s main asset, Binance, another major platform, said it would dump its own FTT holdings, setting off the run that triggered FTX’s collapse.

Genesis Global Capital, another crypto lender, had exposure to both Three Arrows and Alameda. It has suspended withdrawals and sought outside cash in the wake of FTX’s demise. BlockFi, another crypto lender with exposure to FTX and Alameda, is preparing a bankruptcy filing, the Journal has reported.

The density of connections between these players is nicely illustrated with a sprawling diagram in an October report by the Financial Stability Oversight Council, which brings together federal financial regulators.

To historians, this litany of contagion and collapse is reminiscent of the free banking era from 1837 to 1863 when banks issued their own bank notes, fraud proliferated, and runs, suspensions of withdrawals, and panics occurred regularly. Yet while those crises routinely walloped business activity, crypto’s has largely passed the economy by.

Some investors, from unsophisticated individuals to big venture-capital and pension funds, have sustained losses, some life-changing. But these are qualitatively different from the sorts of losses that threaten the solvency of major lending institutions and the broader financial system’s stability.

To be sure, some loan or investment losses by banks can’t be ruled out. Banks also supply crypto companies with custodial and payment services and hold their cash, such as to back stablecoins. Some small banks that cater to crypto companies have been buffeted by large outflows of deposits.

Traditional finance had little incentive to build connections to crypto because, unlike government bonds or mortgages or commercial loans or even derivatives, crypto played no role in the real economy. It’s largely been shunned as a means of payment except where untraceability is paramount, such as money laundering and ransomware. Much-hyped crypto innovations such as stablecoins and DeFi, a sort of automated exchange, mostly facilitate speculation in crypto rather than useful economic activity.

Crypto’s grubby reputation repelled mainstream financiers like Warren Buffett and JPMorgan Chase & Co. Chief Executive Jamie Dimon, and made regulators deeply skittish about bank involvement. In time this was bound to change, not because crypto was becoming useful but because it was generating so much profit for speculators and their supporting ecosystem.

Several banks have made private-equity investments in crypto companies and many including J.P. Morgan are investing in blockchain, the distributed ledger technology underlying cryptocurrencies. A flood of crypto lobbying money was prodding Congress to create a regulatory framework under which crypto, having failed as an alternative to the dollar, could become a riskier, less regulated alternative to equities.

Now, stained by bankruptcy and scandal, cryptocurrency will have to wait longer—perhaps forever—to be fully embraced by traditional banking. An end to banking crises required the replacement of private currencies with a single national dollar, the creation of the Federal Reserve as lender of last resort, deposit insurance and comprehensive regulation.

It isn’t clear, though, that the same recipe should be applied to crypto: Effective regulation would eliminate much of the efficiency and anonymity that explain its appeal. And while the U.S. economy clearly needed a stable banking system and currency, it will do just fine without crypto.

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