When is a hollowed-out, well-worn, foot-long hunk of wood worth 3.5 million dollars? When it’s a hunk of wood that was carved into a violin 267 years ago by the renowned violin maker Guarneri del Gesu.
3.5 million dollars was the extraordinary value settled upon by the tiny cadre of great violin collectors when violinist Robert McDuffie put together a consortium of investors to purchase one of del Gesus’ almost mythically great instruments. The consortium has been assured that when the instrument is resold in 21 years, its value will be in the neighborhood of 24 million. Not a bad return on a 3.5 million investment.
Obviously the value of this, and other great violins, is not determined by any one factor. The value of the violin is not its age, not the quality of the tone it produces, not even the fact that it’s one of only 150 or so del Gesu violins officially authenticated.
The value of McDuffie’s violin, and of some of the other great del Gesu and Stradivarius instruments, is determined by an ephemeral and ever-changing configuration of factors. Any one of those factors may change at any time and radically alter one of these great instrument’s value. Investment researcher Jon Gertner, writing for collectors on the investment value of rare violins, warns about Five Violin Lessons that work together to determine the market value of these instruments (This Violin Is Worth $3.5 Million: Why?; Money June 2002, 148):
1. Age and rarity are not the source of value.
2. Brand name matters, whether it’s a stock, a school district, or a 17th century violin.
3. Value can change in an instant, without warning.
4. Value is shaped by perception – and perception is not free of personal prejudice.
5. When the world changes, the value of an object may change – even if the object itself remains exactly the same.
Art collectors have always counted on Lesson #3. Any serious collector stockpiles works by respected, noted living artists knowing full well that the moment that living artist becomes a dead artist, the value of his or her artwork will rise significantly. The pieces themselves have not changed. But because their creator is no longer creating, they’re now valued according to an entirely new set of rules.
I guess the point that jumps out at me the most is number 5. The world changes, the value of an object may change – even if the object itself remains exactly the same. In a world that is forever changing, it becomes more imperative that we find things that remain the same. Things that remain the same increase in value greatly the more our world changes.
God bless you today!