Last week my six-year-old came home from school loaded up with books from the school book fair but nonetheless wanting to Amazon another, How to Read People’s Minds.  Now, among other considerations, I try to evaluate my kids’ “needs” (they always classify their wants as such) through the prism of educational merit.  From that perspective, this request was an easy one to accept.   Much of one’s success in life is supposed to be related to EQ (emotional intelligence), of which understanding other people plays a large part.  (Dubya is supposed to have had it in spades, though, personally, I’d rather have a beer with Barack any day of the week.  And, anyway, if I were imbibing with Dubya, I’d request a chardonnay, just to get under his skin….)

It may be difficult to read other people’s minds, but, paradoxically, it may be almost as challenging to fathom our own. We may think we can, but a growing body of literature supports the conclusion that our thoughts and actions are governed by a self largely unknown to us, a reptilian brain buried deep beneath our consciousness that controls us in a manner we can’t perceive and guides our actions in ways we don’t understand.  This, unfortunately, is just as true in the arena of collecting art as it is in gathering grain or finding a mate.  Of late a number of books and articles have appeared that help elucidate these mysterious forces.  I’d like to recommend a couple of them to you, not only for their general interest, but to save you from taking a costly wrong turn while hunting and gathering.

The need for self-awareness is palpable.  I receive inquiries to evaluate the authenticity of Picassos on an almost daily basis, typically ones on eBay but also from storefront galleries and websites.   Call it a coincidence, but the last two collectors that I successfully steered away from buying eBay fakes were both dentists.  However, the third collector, a doctor, didn’t fare so well.  The doctor had recently approached me for an opinion on a bon à tirer,  the handwriting of which, to my eye, didn’t look right.  The dealer had a bunch of these bon à tirer impressions from the same illustrated book.  The doctor, while toying with due diligence, unearthed a second bon à tirer of one of these prints in the Online Picasso Project.  Its signature and inscription were clearly by a different hand, and, in this case, the online handwriting looked right to me. Needless to say, there can be but one bon à tirer impression for any print. A smoking gun, wouldn’t you say?  I figured that that was the end of the deal.  No question–the good doctor would take his money and run.  Next thing I know he’s bought the bon à tirer, paying about 10x its unsigned value.   His reasoning?  A well-known dealer would not be selling bad prints. He added, “No gallery could survive the scandal of advertising a whole suite of fakes on the web, don’t you think?”   Right.

And it’s not just collectors—even dealers aren’t exempt from the tug of the irrational.  My latest example: just last week a private art dealer whom I hadn’t seen in years brought over two sets of well-heeled clients to look at our Picassos.  What had suddenly inspired him?  For one thing, we had recently acquired a print that one of the women had lusted after for years.  But the underlying reason was his astrologer, who had foretold that he was going to make a killing this month.  (Need I remind you I live in California?)  The dealer arrived fairly certain that this was going to be his best month ever.  So far, nothing, but I remain confident, since astrologers are always right.

Artists are human, too.  It may not matter as much, but of course Picasso himself was famously superstitious.  Olivier Widmaier Picasso, his grandson and apologist (a rather convincing one, to my mind) who dispels the myths about Picasso one chapter at a time, devotes one of the final chapters of Picasso: The Real Family Story to the unavoidable concession that his gramps was indeed a very superstitious man.

Of course all of this only applies to other people, but not to you or me.   Thankfully, irrationality is only the next guy’s problem.  And there’s the danger….  So maybe a homework assignment is in order.  For an excellent review of the research into the unconscious written in layman’s terms, try Strangers to Ourselves (2004), by Prof. Timothy D. Wilson, who makes his basic point in his title.  He presents the accrued wisdom of this field, which unlike Freud, has resulted from rigorous experimental science.  What’s at least as interesting as his theme is the many ingenious experimental designs which psychologists have devised to interrogate the unconscious.  After all, you can’t very well ask it a straight question or expect a straight answer.

Moving a bit closer to our subject, I would wholeheartedly recommend the NY Times bestseller, Sway: The Irresistible Pull of Irrational Behavior (2008) by Ori and Rom Brafman as well as Predictably Irrational: The Hidden Forces That Shape our Decisions (2009) by Dan Ariely, both hilarious, if scary, reads.  But I fear this rant is getting dangerously close to exceeding your rant capacity, so I’ll spare you the book reviews and move on to the home stretch.

Four years later, I am still haunted by one particular instance of buyer’s irrationality, the bizarre ending of the PiCostco saga, the fake Picassos that Costco sold around four years ago (see and ).  To remind you, apart from the surprising news that Costco was in the business of selling ostensibly fine art, what I found to be the most amazing thing about it was that the two hapless buyers did not take Costco up on its offer to fully refund the $35-40,000 that each of them had shelled out for their fake drawings.  I remain baffled that the buyers (one of whom, wouldn’t you know it, was another MD) would not wish to part with their worthless (and ugly!) Picassos.  A recent essay in The New Yorker entitled Status-Quo Anxiety by James Surowiecki (August 31, 2009) shed a bit of light on this conundrum, despite the fact that he intended it as a commentary on the health-care debate.

Surowiecki writes, “The mere fact that you own something leads you to overvalue it. A simple demonstration of this was an experiment in which some students in a class were given coffee mugs emblazoned with their school’s logo and asked how much they would demand to sell them, while others in the class were asked how much they would pay to buy them. Instead of valuing the mugs similarly, the new owners of the mugs demanded more than twice as much as the buyers were willing to pay. The academics Ziv Carmon and Dan Ariely showed the same thing in a real-world experiment: posing as ticket scalpers, they phoned people who had entered a raffle to win tickets to a Duke basketball game. People who hadn’t won tickets were willing to pay, on average, a hundred and seventy dollars to get into the game. But those who had won tickets wanted twenty-four hundred dollars to part with them. In other words, those who had, by pure luck, won the tickets thought the ducats were fourteen times as valuable as those who hadn’t.”

This analysis doesn’t factor in the profit motive, but never mind.  It calls to  our attention the pride of ownership, which could  be a more pernicious psychological force than we may have thought.  And it’s not just pride.  Whenever I have succeeded in acquiring a work of art, I have bought it because I valued it higher than everyone else—otherwise someone else would have bought it sooner or paid more (or both).  Now I may think that I’ve valued it reasonably, but have I really?   Pride of ownership, or whatever it is, is not to be underestimated.

What is called for is a catchy term that expresses the opposite of buyer’s remorse, since it seems even more prevalent, and arguably much more dangerous to our pocketbooks.  Buyer’s bliss?  Collector’s complacency?  Shopper’s satisfaction?  Pick the one you like or choose your own, whatever it takes to keep it in mind.

A little short on EQ myself, I am finally beginning to realize that I ought to keep my thoughts to myself, or at least that imparting them to you in this less direct manner might not be as offensive.  I imagine it wouldn’t surprise you that the PiCostco doctor did not like hearing my unsolicited advice.   We have not stayed in touch.  As for the bon à tirer doctor, his parting comments were, “Thanks for these emails.  They are interesting.  I’m currently enjoying the Picasso.  I am planning to bring it in to an appraiser pretty soon though.”