Unbreakble Investing in Chinese...

Unbreakble Investing in Chinese Ceramics

The Essential Principals of Collecting

Chinese and Asian Ceramic Art

Richard Mills CFA

To my family and friends… you know who you are.

Copyright © 2013 by Richard Mills All rights reserved. No part of this electronic book may be used or

reproduced in any manner whatsoever without the written permission, except in the case of brief quotations embodied in critical articles and reviews. For

information, address The Chalre Collection at [email protected] .

If you acquired this electronic book through an informal source without paying for it, you could in possession of

stolen property and can be prosecuted.

Published independently by Chalre Associates

Attention: Corporations and Organizations This electronic book is available at special quantity discounts for bulk

purchases for sales promotions, premiums or fund raising.

For information, please email: [email protected] See other contact information at the website of

Chalre Associates at ceramics.chalre.com .

mailto:[email protected]

mailto:[email protected]

http://www.chalre.com/

_____________________________________________________________________________________

Unbreakable Investing in Chinese Ceramics

Introduction: Unbreakable Investing

1st: History of Chinese Ceramics page 1

2nd: Categories of Chinese Ceramic Art

page 5

3rd: Ceramic Art Investment page 11

4th: Collecting Asian Ceramic Art

page 18

5th: Authenticating Chinese Ceramic Art page 26

6th: Advanced Authentication

page 45

7th: The Story of Fakes page 48

8th: Addendum 1: Chinese Dynastic Markings

page 53

9th: Addendum 2: Chinese Dynasties Relevant to Ceramics page 57

Unbreakble Investing in Chinese Ceramics

The Essential Principals of Collecting

Chinese and Asian Ceramic Art

Richard Mills CFA

Introduction UNBREAKABLE INVESTING IN CHINESE CERAMICS

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Introduction: Unbreakable Investing The purpose of this electronic book is to provide people with basic information about the very interesting subject of investing in Asian Ceramic Art. First of all, Asian Ceramics is mainly about Chinese Ceramics since the Chinese were the originators of fine ceramics and the foremost producers for centuries. There have been many books written about Chinese Ceramic Art over the years but most have been authored for academic purposes and are inappropriate for busy professional people who desire to know useful information quickly and clearly. This short book should allow anyone to quickly become articulate in the general styles and history of the art medium. Another deficit in virtually all sources of information about Ceramic Art is that of its investment qualities. In learning about the medium, people naturally become interested to collect pieces – especially the case for those living in Asia or doing business in the region. Basic information about Asian Ceramics as an asset investment class is presented in this e-book. By far the most outrageous shortfall of virtually all materials written about Asian Ceramics is the taboo about discussing authentication. The concept of fakes (as it is commonly known) is far more important with Chinese Ceramic Art than with almost all other art mediums (and investments) and it makes the asset class more exciting and interesting. This book will describe the basics of authentication so people can understand the concepts involved. Unbreakable Investing is a work in process and will be expanded to include sections on shapes, colour, surface decoration and other subjects that are important in understanding and appreciating the medium and its investment opportunities.

chapter 1 UNBREAKABLE INVESTING IN CHINESE CERAMICS

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History of

Chinese Ceramics In the beginning, there were pots... It has been established that the Chinese created some of the world’s first Ceramics eight thousand years ago with the fashioning of hand-molded Earthenware containers. In the late neolithic times, the potter's wheel was developed enabling a dramatic advancement in EARTHENWARE Ceramics. The sophistication of early Chinese potters is irrefutably demonstrated by the famed terracotta warriors uncovered by archaeologists in the tomb of Emperor Qin (259-210 BCE).

Over the centuries, China maintained its dominant position as the world's preeminent producer of Ceramics as countless new technologies and styles were developed. One of the most important was the TRI-COLOUR STONEWARE of the Tang dynasty (618-907 CE), named after the bright yellow, green and white glazes. This period also marked the first wide-spread use of ceramic as a decorative medium of art. The Celadon Innovation Another type of pottery that developed during the Tang period was Qingci, known more commonly to English speakers as CELADON. This style often has a greenish glaze and is usually

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HISTORY OF CHINESE CERAMICS chapter 1

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simply but elegantly shaped and decorated. Celadon was so successful that production continued in China for centuries and was traded widely throughout the known world. White Becomes Fashionable During the Song dynasty (960-1279 CE), WHITEWARE CERAMICS became a dominant form. The style became one of the most successful Ceramic types ever produced in China and was widely traded throughout Southeast Asia. One form of Whiteware that became particularly popular as a traded Ceramic was Qingbai which literally means “bluish-white ware” and has a jade-like texture. Blue and White Conquers the World BLUE AND WHITE PORCELAIN was first created during the Yuan dynasty (1279-1368 CE). Fired at higher temperature than Earthenware, Porcelain is characterized by a glass-like finish of its whitish clay body. Potters of the later Ming dynasty (1368-1644 CE) advanced the art of Blue and White Porcelain to such a degree that most people today think of the style as uniquely Chinese. Chinese Ceramics Reach a Zenith The Qing period (1644-1911 CE) was the last of the imperial dynasties and saw innovative MULTI-COLOURED PORCELAIN designs that reached a new peak in popularity, particularly in the west.

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chapter 1 Unbreakable Investing in Chinese Ceramics

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Ceramic Art is

Enduring Luxury Ceramics are one of the world’s oldest forms of cultural technology and can be traced back more than 11,000 years to Asia and the Middle East. The remarkable durability of fired clay has enabled pottery to become perhaps the most valuable and available records of human development. Ceramics are also one of the most valued forms of cultural and artistic expression. In cultures throughout the world, pottery has been employed at all social levels for the most important events in developed and developing societies -- from pious religious ceremonies to more mundane but rather important activities like eating and drinking. The Spice Trade Trade within Southeast Asia has existed since the Han dynasty (25BC - 220AD). It developed more during the dynasties of the Sui (581 - 618) and Tang (618 - 907). Southeast Asian trade became more of a focus during the extravagant Sung dynasty (960 - 1279) due to advancements in maritime technology and marauding invasions from north China that disrupted trade with central Asia.

Manufactured goods such as silk and cotton textiles, iron implements, Porcelain and cash coins from China were exchanged for mainly native products of tropical countries. These Southeast Asian products included plant-based goods (such as spices, herbal medicines and hardwoods), exotic rarities (like pearls, precious stones, colourful bird feathers and animal tusks) and raw materials (sulfur, animal hides, copper, tin and raw cotton).

HISTORY OF CHINESE CERAMICS chapter 1

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Of thousands of products traded, Ceramics reigns supreme today because of its remarkable ability to preserve itself in mint condition even after being submerged in the sea or buried in the soil for hundreds of years. Ceramics tell the story of how the peoples of Asia forged social and commercial ties with each other over the past 1,000 years. The Chalre Collection of Asian Ceramic Art The Chalre Collection comprises a diverse range of pottery styles dating from more than 1,000 years ago. Pieces are grouped according to type including: Celadon, Whiteware, Blue and White Porcelain, Multi-Colour Porcelain and Earthenware. Included are a large number of shipwreck pieces dating from the Ming dynasty period (1368 to 1644). The Ceramics of The Chalre Collection are not only antiquities of stunning beauty and unique value, but they provide incalculably important information about human social and technological development that occurred in Asia over past millennia.


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Categories of

Chinese Ceramic Art The most important types of Chinese Porcelain and Stoneware Ceramics are explained.

(Main Period: 1400 to 1700 AD) Underglaze Blue Porcelain is the best known type of ceramics. It is often referred to as 'Blue and White' from its blue cobalt oxide painted below the glaze.

The reason Chinese Porcelain became so famous is probably because it was traded widely by Europeans from the 17th century onward. By that time, China had already been exporting Blue and White Porcelain to the Middle East and Southeast Asia for centuries. The first Portuguese merchants to visit China eventually realized the value of the "white gold" and started importing limited quantities for the nobles of Europe. It was in 1603 that the Dutch East India Company (VOC) sent a load of Chinese Blue and White Porcelain to Amsterdam where it was sold for an enormous profit. From that date on, Chinese Blue and White Porcelain became known as the finest in the world Chinese Blue and White Porcelain of the Chalre Collection of Asian Ceramics and much desired in Europe and later in North America.

CATEGORIES OF CHINESE CERAMIC ART chapter 2

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Blue and White Porcelain first appeared during the Yuan dynasty (1127 - 1279) but became so pervasive during the Ming dynasty (1368 - 1644) that today Blue and White and Ming are commonly used interchangeably..

(Main Period: 1000 to 1400 AD) White Porcelains began to be made on a large scale at Jingdezhen and at many other southern kilns from the time of the Song dynasty (960 - 1279). The most famous of the early Porcelains was qingbai (pronounced ching-

pie). Whiteware Ceramics were traded throughout Southeast Asia. Until eclipsed by Blue and White Porcelain in the 14th century, it was the dominant Chinese Ceramic of its era. White Chinese Porcelain of the Chalre Collection of Asian CeramicsQingbai (also called yingqing) translates literally as "clear bluish-white." The jade-like texture of the Porcelain results from the clear glaze that contains iron in small amounts. When applied over a white Porcelain body the glaze produces a greenish-blue colour. Some have incised or molded decorations.


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(Main Period: 1000 to 1600 AD) Celadon is a western word used originally to describe the green glaze of Ceramics from

Longquan in China. The glaze is made of clay mixed with wood ash and is 2-5% iron, and must be fired in an oxygen reduced atmosphere.

The Celadon method began to be used in the 7th century in China. By the time of the Song dynasty (960-1280), the skills of the potters had advanced to a high degree that fine vessels had a jade-like appearance and texture. By the 14th century, motifs such as lotus flowers and stylized chrysanthemums were incised for decoration.

Celadon Porcelain Chinese Ceramics of the Chalre Collection of Asian CeramicsCeladon production in Thailand seems to have started in the later part of the 14th century - around the time of the 'Ming ban' of 1371 when emperor Hongwu decided to prohibit his subjects from trading with all other people. It is thought that Chinese migrants were responsible for development of early Celadon production in Thailand.

(Main Period: 1700 to 1900 AD) During the Qing dynasty (1644 - 1911), potters began using bright colours to adorn plates and vases with meticulously painted scenes.

Porcelain ceramicists began producing five-coloured ware by


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applying a variety of underglaze pigments to floral, landscape and figurative scenes - a style which was (and is) highly sought-after in the West. During the Yung Cheng era (1723-1735) Porcelain wasQing Dynasty Chinese Porcelain the Chalre Collection of Asian Ceramics enhanced by the development of fencai enamel in a wide range of colours and tones.

(Main Period: 1400 to 1700 AD) Long before the Chinese made Blue and White Porcelain using cobalt, a black iron oxide was

used to paint motifs below a clear protecting glaze. This technique, used at Cizhou in northern China, developed independently from the Celadon production in southern China. By the 14th century, the so-called underglaze technique appeared in Thailand and Vietnam. Fish and chrysanthemums, representing long life and happiness, were preferred at Thailand. In Vietnam, a flower motif was common. It is highly possible that the underglaze decoration technique (painting with oxides and then applying glaze) arrived in both Thailand and Vietnam with immigrating Chinese potters.


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(Main Period: 700 to 900 AD) Early Chinese Coloured Stoneware is often called Sancai which means three-colours. However, the colours of the glazes used to

decorate the wares of the Tang dynasty (618 - 911) were not limited to three in number. In the West, Tang Sancai wares were sometimes referred to as egg-and-spinach by dealers for the use of green, yellow and white. Though the latter of the two colours might be more properly described as amber and off-white / cream. Sancai wares originate from northern China. At kiln sites located at Tongchuan, NeiquiTang Dynasty Chinese Ceramics the Chalre Collection of Asian Ceramics county in Hebei and Gongxian in Henan, the clays used for burial wares were similar to those used by Tang potters. The burial wares were fired at a lower temperature than contemporary whiteware. Burial wares, such as the well-known representations of camels and horses, were cast in sections, in moulds with the parts luted together. In some cases, a degree of individuality was imparted to the assembled figurines by hand-carving.

(Main Period: 1000 to 1600 AD) Earthenware is the earliest type of pottery and is known to have existed for the past

10.000 years. Secondary clay was formed on the pottery wheel or rolled into strings and laid on top of another to form the pot. Earthenware was commonly fired in simple


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open pits and therefore found in most early civilizations. Firing temperatures normally reached 400C to 700C. It is thought that most of the Earthenware found its way on trade ships as necessities of the men sailing the ships. Their limited number suggests that Earthenware was never made for export.


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Ceramic Art Investment

It is reasonable to say that people are more open minded today about non-traditional investments than in the past. Stocks and bonds will always be important but continuing regular financial crises have resulted in the belief that paper investments are not as secure or as stable as we all thought they should be. Investors are today diversifying more of their net worth into hard assets with tangible value. Examples include such physical goods as gold, gems, real estate and oil tankers that can act as a hedge against disruptive financial markets. Art is one particularly interesting example of such as an asset. While stocks can pay dividends if companies earn profits, they can also collapse to nothing if the company goes broke. Hard assets like diamonds and Chinese vases don’t provide an income stream but they also don’t go bankrupt. And, while their prices might deflate from time to time, you and your friends can still enjoy them anytime. Prestige is an Asset? The key difference that separates art from virtually all other investment assets is the subtle quality we will call prestige. For people in positions of leadership in our society, owning works of art can be a powerful but understated way of demonstrating a commitment to human achievement that transcends time.

CERAMIC ART INVESTMENT chapter 3

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Such displays have been improving people’s success in their dealings with others since the dawn of civilization and some would say that much of the world’s great art work has been created with this in mind. As an owner of art, the collector takes on the very real responsibility as a keeper and protector of a part of human culture and accomplishment, and it is not to be taken lightly. It is this enduring quality that elevates art far above more profane assets acquired purely for profit. Government bonds, growth stocks and limited partnerships -- important as they are -- seem mundane, and even crass, by comparison. But Can I Actually Make Money from Art? Various studies have shown conclusively that art provides similar returns to equities over the long term. One of the most often quoted studies by professors of the Stern School of Business in New York University showed returns within 0.5% of the S&P 500. Art is a more risky investment (as measured by the variability of returns) but it has consistently outperformed bonds and gold. And, its returns are often negatively correlated to financial investments -- it is good for diversification, in other words. Being a long-term investment, art seems suitable for long-term investors like pension funds and life-insurance companies. One of many examples of success was the British Rail Pension Fund that invested £40m in 2,400 works of art beginning in the mid-1970`s. The collection was gradually liquidated by the 1990's and yielded an average annual return of 13% -- respectable by any measure.

Various research has concluded that buyers of art conduct themselves in manners similar to buyers of luxury goods. Therefore, it is important to understand the characteristics of luxury goods so we can better appreciate art. What are Luxury Goods? Luxury goods are defined by economists as those with a high income elasticity of demand. In other words, people buy more and more of them as they get wealthier. An example is high priced time-pieces. We might acquire


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our first luxury watch only when we start to have high disposable income. As we become wealthier still, we may buy more. Conversely, if our wealth declines we will most likely hold off spending $10K for another swanky watch. Demand characteristics for necessity goods like food are very different since people don’t automatically buy more if they become wealthier -- and they might even buy less. An example is regular white bread. No matter how destitute we become, we still need to eat a roughly constant number of loaves. But as we become well-to-do we might eat less of it, dining instead on organically-grown whole wheat breads costing ten times more. Income elasticity of demand can also change at different levels of income. Someone might collect sports cars when he is merely well-off then push them aside for private jets when he actually becomes prosperous – a common scenario for some people in the Middle-East when oil prices are high. What’s So Special About Luxury? The accepted characterization of “luxury” is a good that is greatly superior to comparables. Most product classes today have up-market categories that are differentiated into increasing levels of quality, features, styling and so on. In the garment industry, the Haute Couture movement of France is a better organized example of this. There are strict standards set by the French government and only a few producers are chosen for the designation. Garments need to be hand sewn and of flawless workmanship with entire teams of highly skilled professionals involved -- seamstresses, beaders, embroiderers, dyers, fitters, finishers, etc. Less expensive gowns can certainly be acquired from Walmart but people who desire garments with lasting quality and styling will pay what is required for Haute Couture names like Dior, Givenchy and Lacroix. Some operators in various industries have created entry level luxury goods meant for customers who are new to the concept of luxury. They exploit shrewd promotional tactics to create the perception of luxury but without the aggravation of actually creating superior merchandise. Surprisingly, this “slap-on-a-logo-and-charge-a-ridiculous-price” technique seems to actually work to create crazes for fashion-oriented products. Buyers tend to be innocent (and often younger) people. Due to its transitory nature, such


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faddish merchandise is not considered of consequence for experienced luxury buyers. Many luxury products are subject to an interesting pricing phenomenon that economists call positive price elasticity of demand. The perceived value of such goods rises as their prices increase. In other words, an attractive bottle of fragrance with a high price will be thought by buyers to be more valuable (in terms of its positive attributes) than if it were lower priced. The demand for luxury goods is closely tied to economic prosperity. It is not surprising that Asia, the world’s fastest-growing region, is also the fastest growing market for luxury goods. Given the huge populations of countries in the region and their economic resiliency, it is felt that Asia will be the dominate market for luxury goods for decades into the future. What's It All Mean for Art? Japan's great economic achievements culminating in the 1980's allowed it to become the world's leading market for luxury goods and art during that same period. In key segments like the French Impressionists, Japanese collectors completely dominated the market for most of the decade. It seems reasonable to expect that increasing prosperity in other Asian countries will have a similar positive impact on demand. The remarkable economic success of China is often noted because of its enormous population and rich history of art appreciation. According to the Economist magazine, China has already overtaken France and Britain as the world's 2nd largest art market (after the US). Apparently, the future is coming faster than many thought possible.

Ceramics such as Porcelain, Stoneware and Earthenware produced in China and other Asian countries are a unique category of art with unique investment characteristics.


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Concept 1: Buy-and-Hold It should never be misunderstood that art is a long-term investment. Given its low trading volume and high transaction costs, art needs to be held for a considerable length of time before suitable returns can be realized. Concept 2: Buy Low, Sell High As with most other forms of art, Ceramics does not provide a regular income stream. Investors anticipate a return from price escalations that are outside financial logic. Concept 3: Costs of Ownership Art is considered a tax free investment but it has costs of ownership related to insurance and storage (depending on the size of the collection). Storage costs for Ceramics are less than decorative wall pictures (like oil paintings) since they do not require elaborate temperature and humidity control. Concept 4: Liquidity Most art cannot be bought or sold easily or quickly without suffering tremendous compromises in price. Art markets are thinly traded and sales are usually at auctions on set dates. Concept 5: Anonymous The nature of ancient Ceramics is different from decorative wall pictures such as oil paintings because the artist is anonymous. Collectors of Chinese Ceramics focus on attributes such as style, period and condition of the works. Concept 6: Transparency Reputation of the seller has a strong impact on demand. Buyers are reliant on the opinions of expert buyers to determine whether price is realistic. Market knowledge is a competitive advantage.


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Concept 7: Enduring Luxury Various studies have shown conclusively that the demand/supply characteristics of art are similar to that of sophisticated luxury goods. Art. however, is very different from most luxury goods in one very important regard -- depreciation. Investment quality art appreciates in value over time. By comparison, typical luxury goods such as yachts, automobiles, jets and haute couture garments lose value rapidly over time. Concept 8: Reputation For people in positions of leadership, owning works of art can be a powerful but understated way of demonstrating a commitment to human achievement. Such displays have been improving people’s success in dealings with others since the dawn of civilization.

Various factors impact the supply and demand of Chinese and other Asian Ceramics (Porcelain, Stoneware and Earthenware).

Demand There are 2 main factors affecting demand for Chinese and Asian Ceramic Art. 1. Popularity Ancient art does not have seasonal fashion cycles like shoes worn by teenage girls. Nevertheless, certain art styles can become more popular as the result of a celebrity collector or some other reason. The re-emergence of China as a global power is said to be of profound importance to the world’s art market in general and Chinese Ceramic Art in particular. The world outside China is suddenly taking interest in the great nation's culture and history and its art like never before (or at least not in recent centuries). The result is increasing demand for Chinese Ceramics by non-Chinese. But the largest source of new demand for Chinese Ceramics is from Chinese people themselves. China has a history of art appreciation that extends


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through thousands of years. Chinese collectors are interested to buy ancient works as an expression of their nation’s remarkable history and rich artistic culture. The impact on demand for Chinese Ceramics is compounded by the simple fact that so little Chinese art is actually inside China. The effect of this demand phenomenon is already being felt. China recently overtook France as the world's 3rd largest art market (behind the US and Britain) according to the Economist magazine. 2. Economic Prosperity Art investment is dependent on disposable income. Strong economic growth is necessary if there are to be buyers of art. Gladly, the extraordinary economic success of China seems to be providing the necessary environment for producing lots of buyers. While many countries worry about trade deficits, fiscal shortfalls and other problems, China’s economy continues to surge ahead. It bodes well for the art market, and especially the Chinese Ceramic Art market, for the foreseeable future. Supply As China was the world’s premier producer of Ceramic Art for most of the past thousand years, people are mainly interested in pieces from that glorious period ending about 100 years ago. Therefore, supply such works is said to be static. Possible increases in supply could come from ancient shipwrecks that have yet to be recovered, said to be many throughout Southeast Asia. However, the volume of ancient ceramics involved from such salvage operations should not be enough to disrupt the overall market. On the contrary, demand will likely increase to more than meet the extra supply because of enthusiastic media exposure that such discoveries bring. This has been the experience with by archaeological adventurers like Sten Sjostrand. Authenticity is a growing issue for most luxury goods including Chinese Ceramics. Fakes are disruptive for the ceramics market because they discourage new collectors who usually lack experience with authentication. It is an open question at this time what the overall impact of counterfeits will be on the market. .


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Collecting Asian Ceramic Art

It seems perfectly intuitive that the best place to acquire ancient Chinese Ceramic Art (Porcelain, Stoneware and Earthenware) is in China where it was originally produced. If tiny empires like ancient Greece existing for only a few centuries produced enough artefacts to fill museums of the west, then the massive Chinese empire must have produced gargantuan quantities of art objects over its thousands of years of existence. And it was Ceramic Art that China was considered pre-eminent in all the world. Such was the dominance in past centuries that even today the word “china” is used interchangeably as porcelain. Given the remarkable history of achievement, ancient Ceramic works of art must be laying around all over China for anyone to just pick up off the ground! Most "ancient" ceramics sold by dealers in China are fakes. Unfortunately, that is not the case. Like most countries that produced great works of art in


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ancient times, later generations did not always look after it until there was very little left. In China, there were 2 great upheavals that caused the great nation to lose most of its ancient Ceramic Art treasures. The most catastrophic of these is thought to be the Cultural Revolution launched by Chairman Mao Zedong in the mid-1960’s. During the tumultuous period, millions of ancient art objects were smashed to bits by fanatical young proletariats in their drive to demolish sinister counter-revolutionary values. It was an incalculable loss to China and to our species as a whole. Chinese art also suffered a lot of abuse due to invasions and related bad behaviour of foreign powers. The western countries in particular were the cause of much shameful damage to and theft from the great country’s wealth in art objects. Thankfully, the objects extracted were revered by these foreigners and some of the finest Chinese Ceramics Art collections in Europe were founded upon these acquired artefacts. Perhaps the greatest art theft from Chinese territory was accomplished by Chiang Kai-shek’s Nationalist Army near the end of the Chinese civil war. When it became clear that the communists would win the mainland, the bulk of the Chinese palace museum collection was evacuated to Taiwan. It has been said ever since that Chiang Kai-shek “lost the country but got the best stuff.” Today, the National Palace Museum in Taipei is the curator of this invaluable collection of 650,000 works art comprising 8,000 years of Chinese history. For these reasons and others, China does not have much in the way of Chinese works of ancient art. A public example of this unfortunate situation is the Ceramics collection of Palace Museum in Beijing. Considered the country’s greatest, it is disappointing in both quantity and quality. Given the scarcity, the Chinese government now understandably forbids the export of ancient artefacts of almost all sorts. Collectors who attempt to acquire authentic pieces do a great disservice to the nation of China and take a lot of risk for themselves. On the other hand, the export of replica Ceramic Art (otherwise known as fakes for which China is the world's greatest producer) seems greatly encouraged by the Chinese government. The items that are available for sale from dealers in China are of doubtful repute and almost certainly fakes.

COLLECTING ASIAN CERAMIC ART chapter 4

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The Chinese tradition of producing imitations works of art is ancient – as it is in all civilizations. During the 18th and 19th centuries, it was respected practice for Chinese potters to imitate the designs of 14th and 15th centuries as a display of admiration to the great achievements of those past ages. At that time, no attempt was made to deceive buyers as the date markings were clear as to when the works were produced. Fakes dominate in most wealthy Asian cities.If we move forward to today, China has become the workshop to the world and has also learned to make imitations of most merchandise: luxury hand-bags, clothing, electronic gadgets, drugs and so on. Anyone who has spent time in emerging countries knows that most of the “branded” merchandise available for sale are actually knock-offs from China. Even in so-called advanced countries, it is estimated that 10% of all branded products sold are high-quality fakes produced in China and the number is increasing. Given that the Chinese seem able to produce fakes of everyone else’s products, it is reasonable to expect that they can do the same for their own. One such example of this is high-quality fakes of ancient Chinese Ceramics. The result is that the majority of old looking Porcelain and Stoneware Ceramics available for sale in the advanced cities of Asia are high-quality fakes. Hong Kong, Singapore, Beijing, Shanghai, Taipei and Kuala Lumpur are the most obvious examples. Sophisticated collectors have long gotten hold of authentic pieces and high-quality fakes are filling the void for ongoing demand. But unlike other products, the sellers of forged antique Chinese Porcelain do not have to


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worry about going to jail. No one owns the copyright of a vase design that was created 5 centuries ago. The picture above shows one of the principals of The Chalre Collection in the premises of an apparently prominent antique dealer in Beijing. All of the pieces on display are certainly fakes but being passed off as authentic to foreign buyers.

Many of the coastal countries of Europe such as Britain, Sweden and the Netherlands have engaged in centuries of maritime trade with Asian countries. They have been buying and selling Chinese Porcelain and (less so) Stoneware Ceramics for dozens of generations. The trade in "Chinese white gold" is an important part of their illustrious history and remains a source of great pride even today. As a result, there is a deep knowledge of and appreciation for ancient Chinese Ceramic Art and it is possible to collect through experienced and knowledgeable sources. As well, northern Europeans are generally cautious (and pleasant) people with great repugnance for counterfeit art. Reputable dealers will generally stand behind what they sell and are usually sincere in their trade. As a result, artefacts acquired from such people and the main auction houses are usually authentic. European trade with Asia began during the 16th century during the Ming dynasty era and continued through the Qing dynasty and republic eras. Therefore, most Chinese Ceramics available are Blue and White Porcelain (high-fired white Ceramics with cobalt blue decoration under a transparent glaze) and multi-coloured Porcelain of the Qing dynasty. Earlier styles such as Whiteware Ceramics (such as Qingbai and Dingware) of the Sung dynasty and other eras are not as common for the simple reason that no one from Europe traveled to Asia during the time when they were being produced. Therefore, be wary of anyone who says he has lots of


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ancient Chinese whiteware that was previously owned by a little old lady who inherited from a great-great grandparent. For collectors, the only downside to the happy situation in Europe is the cost. Pieces acquired in these countries are expensive..

The United States and Canada are relatively young countries in the great scheme of things. Neither has a significant history of trade with Asia such as existed between Europe and China. Most of the Chinese (and other Asian) Ceramics available in North America was originally transported by individual collectors and dealers rather than through large scale trade networks existing over centuries. Therefore, the overall quantity and quality is said to be less than existing in Asia and Europe. That said, there is certainly enthusiasm for Chinese and other Asian Ceramic Art. Prominent collectors like the Rockefellers had great interest to part with their money to acquire them. John D. Rockefeller Jr. is quoted in a letter to his father as saying, "A fondness for these Porcelains is my only hobby...and I have become very fond of them...The money put into these Porcelains is not lost or squandered." The purpose of the letter was to ask dad for $1M to buy pieces. The equivalent in today's dollars is about $20M. As a result of such enthusiastic collectors, there are artefacts available and a lively -- although small -- market exists. However, as the Americans and Canadians were late to come to the market, they have not had time to develop the depth of knowledge that exists in Asia and Europe.


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As well, the rambunctious nature of US-style capitalism seems to attract certain individuals who, in their enthusiasm to provide customers with what they want, don't spend required effort on aggravations like authentication. Many buyers are defenceless against such renegades since collector associations are not as developed as they are in Asia and Europe. People are less able to trade gossip about what the scallywags are up to. Gladly, the online revolution might rectify this somewhat over time. The most important styles of Ceramics available in the US and Canada are Blue and White Porcelain (high-fired white Ceramics with cobalt blue decoration under a transparent glaze) and especially multi-coloured Porcelain of the Qing dynasty era. Styles of earlier periods such as Sung dynasty are not commonly available in North America. The deficiencies described above are compounded by the fact that prices asked by reputable dealers and auction houses are relatively high..

Probably the least obvious region to buy Chinese (and other Asian) Ceramics is in the less developed countries of Southeast Asia. To understand the reasons behind this, it is important to first understand the history of the region. Trade networks have existed for the past thousand years in Asia. Trade within Southeast Asia has existed since the Han dynasty (25BC - 220AD) and has continued – with some interruptions -- to this day. Silk and cotton fabrics, advanced metal weapons and tools, and elegant Porcelain and Stoneware Ceramics are a few of the multitude of luxury goods from China that were traded over the 2,000 year period. The tribal kings and other elite of countries like Indonesia, Philippines, Malaysia and Vietnam had great desire for advanced Chinese goods. In addition, the sizeable communities of


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Chinese emigrants that developed over the centuries also naturally had desire for high-quality Ceramics and other products from their homeland. Of all the goods traded, Porcelain and other glazed Ceramics are today considered foremost among these for the simple reason that they are the only ones that survived. Ceramics can emerge in mint condition despite being buried for centuries underwater or underground -- unlike virtually all other traded goods and art mediums. We would have lost much of our understanding of ancient Asian civilizations had they chose a less durable material for their art. Chinese (and other Asian) ceramic items were revered by the people of Southeast Asia and given almost holy status. As a result, more of it has survived to the present day than in China itself. Porcelain, Celadon and other glazed Ceramics were handed down from generation to generation or enclosed in tombs. Artefacts were also preserved in the many shipwrecks that occurred over the centuries in the region’s violent tropical storms. Trading ships frequently sank during tropical storms in ancient times. As a result of its history, many countries in Southeast Asia developed an inventory of ancient Porcelain, Stoneware and even attractive Earthenware Ceramics that can be acquired by modern collectors. This situation is made better for collectors since these countries have not (until recently) been an export destination for dealers in Chinese fakes. Further, countries like Indonesia and Philippines never developed indigenous glazed Ceramics traditions and so there are fewer potters with the skills to be able to make modern fakes. Thailand and Vietnam, on the other hand, did develop the skills to produce glazed and intricately decorated Porcelain and Stoneware. This was probably the result of Chinese potters who relocated to the countries. As a result, modern fakes are more common in these 2 countries since some can be produced locally. The downside to this mainly happy situation is that collecting Ceramic Art in emerging countries is difficult. A lot of time and tremendous aggravation is required to find reputable dealers and price negotiations are convoluted


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and painful. And finally, Chinese fakes are starting to appear in shop windows in greater numbers and the authentic pieces remaining will almost certainly soon be overwhelmed with them.


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Authenticating Chinese Ceramic Art

Basics of Authentication:

All Ceramics are constructed of clay, an earthen material of tiny-grained minerals. Being a natural substance, it usually has small amounts of impurities. One of these that is useful to collectors is iron. Over a long period of time, iron moves to the surface of ceramic objects and forms little dark specks. The iron becomes oxidized when it comes into contact with air and appears brownish or even black. Rust spots are helpful to collectors since they require centuries to develop and their presence can be an indicator of age. They are easiest to see on Porcelain since the base material is usually white. Rust spots seem more common on 'Blue and White' Porcelain of the Ming era since these older pieces have been around long enough for rust spotting to


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develop. As well, there seems to have been more impurities in the clay used during that ancient time. Rust spots can also be seen on more recent multi-coloured Porcelain of the Qing dynasty but is less common. It is possible to fake the rust spot effect but it is not yet commonly done perhaps since it is difficult to do effectively. Most imitated rust spots are easy to identify by people who have seen pieces with the natural effect.

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Glaze is what gives Ceramics their glossy appearance and smooth texture. The effect is created when a muddy-looking liquid mixture containing silica is applied onto the surface of the ceramic and then fired in an oven. At high temperature, the silica melts to form a glass cover over the ceramic. In very early times, Chinese Earthenware Ceramics was glazed to make it water impermeable. Stoneware and Porcelain, heated at a higher temperature than Earthenware, is already water impervious but glaze was still used. In many eras, glazing was applied to give colour and strength to Ceramics (as in Celadon or Whiteware). In other times, it was used to protect intricate decoration underneath (as in Blue and White and multi-colour Qing Porcelain). Glaze Deterioration on an ancient Chinese Porcelain from shipwreck Compared to most art mediums, Ceramics is remarkably durable and glazing is a primary reason behind this. Ceramic artifacts can emerge in mint condition despite being buried for centuries underwater or underground. Given that the art tradition in China is probably 1,000 years older than that of the west, we would


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have lost much of our understanding of ancient Asian civilizations had they chosen less durable materials for their art.

New Ceramics such as those you see at department stores appear to gleam and are highly reflective. Ancient pieces should naturally look less lustrous and even a bit dull by comparison. Ceramics excavated from shipwrecks can be recovered in mint condition but a lot depends on their position in the wreck. If pieces are buried deep in a bed of soft mud,

they can be protected. If they were submerged in sand and exposed to shifting currents, they can lose a lot of their glaze and will have a coarse surface. In some cases, even the underglaze decoration will be partially removed. Many ancient Whiteware pieces of the Sung dynasty period have survived because they were buried underground. These show a different type of deterioration (see Qingbai vase at bottom).


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In ancient times, all Ceramic works were constructed by hand. Working conditions in those days would probably not always meet the quality benchmarks of today -- or the health & safety standards. It is not difficult to imagine that there could be impurities and other imperfections in products that resulted. There were 2 actions that were taken when items had imperfections, they were either thrown away or sold to less demanding customers. It was this decision that often marked the difference between Imperial and Tradeware Ceramics. Imperial Ceramics were those produced for the court of the emperor of China or for his various government officials, military commanders and so on. Being the most advanced people in the world at the time, their works of art had to meet exacting standards. Items not measuring up were simply smashed to pieces. Tradeware Ceramics, on the other hand, were designed to meet the tastes and requirements of the elite of Southeast


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Asia whose demands were not quite as sophisticated as the Chinese. Therefore, Tradeware Ceramics sometimes has impurities embedded into surfaces that add character and authenticity. Foot rims were often placed in sand during firing and some of the material attached to the bottom. On other pieces, ash and other materials flying around during firing became implanted in the surface. A simple test of a dealer’s knowledge and/or integrity is hold up an imperfect piece -- they are not hard to find in most shops -- and ask whether it is an Imperial Chinese item. If the answer is “yes,” then you are off to a bad start.


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Tiny imperfections in the outside surface of Ceramics can be caused by glaze contractions and are somewhat common on Chinese and other Asian Ceramic art. They appear like small indents in the glaze and are more common on Tradeware rather than Imperial Porcelain. The cause of glaze contractions can be fleck of embedded material or oil underneath the glaze that prevents the glaze from completely covering the clay. During firing, the glaze will not be as thick and will show up as a little depression. In some cases the contractions are so small they can only be seen under magnification. Others will be larger and appear dark coloured because dirt has been entrenched.

The majority of ancient Chinese and Asia Ceramics have glaze contractions (or rust spots) due to the nature of the production processes centuries ago. They are generally more pronounced on Tradeware rather than Imperial Porcelain. If none are to be seen, then questions need to be asked why.


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Hairline cracks are very common in various ancient Chinese and other Asian Porcelain, and Stoneware Ceramics. Some pieces can even appear as if the entire surface is cracked in all directions. The effect occurs during the last stage of the firing process when the outer surface cools at a faster rate to the clay underneath. Tiny cracks (called crackles or crazing) are the result. Small cracks can also come about through normal wear & tear of many years of usage.


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Hand-painted decoration can be applied on different layers of Ceramic items. Designs painted under a protective glaze can survive for centuries. Ornamentation applied over top the glaze (called over-glaze) erode more readily because it comes in direct contact with the outside world. Painted overglaze decoration on this Chinese Porcelain shows wear after centuries underwater.Artefacts with both under-glaze and over-glaze decoration can appear to have lost their sense once the over-glaze portion has disappeared. Ceramic Art with over-glaze decoration should display some deterioration if the piece is professed to be ancient.


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The production of Ceramics during ancient times was a backbreaking process taken on by highly-skilled craftsmen. At the end of the protracted process, there were often pieces that were slightly misshapen in the final result. There were 2 actions to be taken when items had imperfections, either throw them away or try to sell them to less demanding customers. Imperial Ceramics are those produced for the court of the emperor of China or for his various government officials, military commanders and so on. Being the most advanced people in the world at the time, their works of art had to meet exacting standards. Items not measuring up were simply smashed to pieces. Tradeware Ceramics, on the other hand, were designed to meet the tastes and requirements of the elite of Southeast Asia whose demands were not quite as sophisticated as the Chinese. Therefore, Tradeware Ceramics sometimes has shape distortions that add character and authenticity to pieces. A simple test of a dealer’s knowledge

and/or integrity is to find a misshapen piece and ask whether it is an Imperial Chinese item. If the answer is “yes,” then you are off to a bad start.


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Sea life attaches itself to anything that spends a lot of time underwater. Virtually all shipwrecks will have part of its Ceramic cargo either partially or completely covered with shell encrustations. Sea life requires a lot of time to attach itself to objects left underwater and mainly takes place in tropical regions (far away from the main imitators in China). Therefore, the effect can provide a natural provenance of sorts. As long as the artefacts has shell encrustations from more than one type of sea life, it should be authentic. Shell encrustations are easily removed from Ceramics. All that is required is to immerse the object into a slightly acidic bath (vinegar will do) and leave it.


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Advanced Authentication

Here are a few techniques that sophisticated collectors watch out for in determining authenticity. Much research is required to be able to use these effectively. This section will be expanded at a later phase of the website's development. 1. Incorrect Colours for a Period In the early days of Blue and White Porcelain, Chinese potters only had access to cobalt blue pigment from Arabian traders. Called Mohamadan Blue, it was dark in shade and most pieces during the eras it was used had dark blue decoration. In later centuries, the Chinese figured how to refine their own cobalt blue but it was lighter in shade. Therefore, decoration on later pieces is lighter and has more varied shading on designs. As well, some colours were not used by potters until later in the Qing dynasty period because the technology for their production did not exist. These are simple examples to this complex and very interesting authentication method. 2. Incorrect Designs for a Period Certain types of designs were fashionable during different periods. For instance, grapes as a design motif was popular in the last Yuan and early Ming dynasties but later went out of taste and were seldom seen again.

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Another example is the eyes of human figures which altered their shapes from period to period. The Chinese emperor also periodically dictated what designs were acceptable on Porcelains. Five clawed dragons were generally used to designate the emperor and most Imperial Porcelain were painted as such. 3. Ancient Base With New Body Over the past century, huge quantities of Ceramics were smashed to pieces. The Cultural Revolution was particularly abusive to fine Chinese Porcelains. Today, entrepreneurial potters are seeking out bottoms of shattered pieces and building new Ceramics on top. Given that much of China currently resembles a construction site, it is not difficult to uncover piles of smashed Ceramics and to pick through them. It is a clever idea since many collectors look at the base for key indicators of age and authenticity.

Most authentication of ancient Ceramics is done by collectors themselves (ideally with the help of other knowledgeable collectors) or by professional authenticators. Scientific techniques to verify ancient Ceramics exist but are not widely used at this time. One big reason has to do with the cost -- it is usually an expensive process. Thermo-Luminescence (TL) Thermo-Luminescence (TL) is the most well known analysis method of ancient Ceramics. The main negative is that the process demands the removal of a large amount of material to be drilled out of the piece which is certainly a cause of concern. Recently, reports have surfaced that counterfeit producers have caught up to the technique. It is alleged that they can mimic the TL age of ancient pieces using simple hospital x-ray machines to fool scientific authenticators.


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Spectrum Analysis Spectrum analysis is another technique that is used for authentication of ancient Ceramics. However, gossip is that forgers have also figured out how deceive technicians by adding trace minerals to their pieces. Another problem is that Jingdezhen, the ancient center of Chinese Porcelain production, is today a popular location for the production of fakes. The kaolin clay available is therefore chemically identical (or very close) to that used to create most of China's Porcelain over the past 6 or so centuries.


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The Story Of Fakes

The Chinese tradition of producing imitations of works of art is ancient – as it is in all civilizations. During the 18th and 19th centuries, it was respected practice for Chinese potters to imitate the designs of 14th and 15th centuries as a display of admiration to the great achievements of past ages. At that time, no attempt was made to deceive buyers as the date markings were clear as to when the works were produced. Fakes dominate dealer shops in most wealthy Asian cities. If we move forward to today, China has become the workshop to the world and has also learned to make imitations of luxury hand-bags, clothing, electronic gadgets, drugs and so on. Anyone who has spent time in emerging countries know that much of the “branded” merchandise available are actually knock-offs from China. In so-called advanced countries, fake jeans and bootleg CD’s are less common since brand owners are able to enforce copyright laws and other regulations more effectively than in less developed countries.


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Given that the Chinese seem able to produce fakes of everyone else’s products, it is reasonable to expect that they can do the same for their own. One of the premier examples of this is high-quality fakes of ancient Chinese ceramics. Certainly, the skills exist to do so. Chinese artisans have been producing some of the world’s finest ceramic works of art for most of the past 2,000 years. The result is a profusion old looking Porcelain and Stoneware available for sale in the major cities of Asia. More and more of these are showing up in North America and Europe, and even in developing countries in Southeast Asia. Sophisticated collectors have long gotten hold of authentic pieces and high-quality fakes are filling the void for ongoing demand. But unlike other products, the sellers of forged antique Porcelain and Stoneware Ceramics do not have to worry about going to jail. No one owns the copyright of a vase design that was created 5 centuries ago.

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The principals of the Chalre Collection sometime come across obvious fakes that are being presented as authentic by dealers and authentic. Such pieces are acquired (at as low a price as possible) for study and discussion. Plaster Shell Encrustations A somewhat Chinese-looking plate is made to look as if it is covered with sea life encrustations. A closer look shows that the piece was smeared with plaster (or similar hardening compound) and shells implanted on. The faked effect is easy to spot if you are a drywaller by trade but maybe not so if you work at a desk all day. We hope this picture will help you to recognize the trick and stay away from dealers offering such pieces.


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Shiny-and-New Sold as Expensive-and-Old The Dish-Mouthed Vase is decorated in a Chinese style and has a small dragon draped around the neck. The piece was claimed to originate from the 1700's by the dealer. However, a close look shows none of the usual indictors of being hand-made or old. Most obvious is the glaze which gleams as if brand new which it surely is.

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New Vase Sold as Antique The Temple Vase has Double-Happiness characters and other Chinese decorations on the main body and neck. The piece was claimed to originate from the Qing Dynasty era by the dealer. It is made to look as if it is hand-made but shows none of the usual indictors of being old. Most obvious is the glaze which gleams as if brand new which it surely is. The tone of the blue is also not similar to true ancient pieces.

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Chinese Dynastic Markings on Ceramics

Inscriptions of various kinds were often painted on Chinese Porcelain. The useful practice of painting reign marks was only common during the eras of the Ming (1368 - 1644) and the Qing (1644 - 1911) dynasties. The marks tell us who the emperor was when the Porcelain was produced. Reign marks were usually painted in cobalt blue on the base of the piece but can also be on the neck or the main body. The marks were usually written in ordinary Chinese script. However, during the Qing dynasty seal marks were often used instead. The presence of a painted reign mark does not mean a piece is authentic -- any Chinese high school student can paint characters in their own language. However, the markings can help to confirm other indications of date.

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addendum 1 Unbreakable Investing in Chinese Ceramics

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CHINESE DYNASTIC MARKINGS addendum 1

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addendum 2 UNBREAKABLE INVESTING IN CHINESE CERAMICS

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Chinese Dynasties Relevant to Ceramics

Asian Ceramics are usually dated according to the reigns of Chinese dynasties when the artifacts were produced. Below are listed the more important dynastic periods of Chinese history.

漢朝 Han Dynasty Western Han (206 BC - 24 AD) Eastern Han (25 AD - 220 AD)

三國 Three Kingdoms Period (220 AD - 280 AD)

晉朝 Jin Dynasty Western Jin (265 AD - 316 AD) Eastern Jin (317 AD - 420 AD)

南北朝 Southern and Northern Dynasties Northern Dynasties (386 AD - 581 AD) Southern Dynasties (420 AD - 589 AD)

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隋朝 Sui Dynasty (581 AD - 618 AD)

唐朝 Tang Dynasty (618 AD - 907 AD)

五代十國 Five Dynasties and Ten States Five Dynasties - Later Liang (907 AD - 923 AD) - Later Tang (923 AD - 936 AD) - Later Jin (936 AD - 946 AD) - Later Han (947 AD - 951 AD) - Later Zhou (951 AD - 960 AD)

宋朝 Sung Dynasty (960 AD -1279 AD)

元朝 Yuan Dynasty (1271 AD - 1368 AD)

明朝 Ming Dynasty (1368 AD - 1644 AD)

清朝 Qing Dynasty (1644 AD - 1911 AD)

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