With equities in the region slumping and currencies and bonds volatile, small investors in Asia don’t have many places to hide from the subprime rout.

They could try I. Nyoman Masriadi, a 33-year-old Indonesian painter, the price for whose canvases is holding strong amid the bout of risk aversion that’s pounding Asian assets.

Morgan Stanley Capital International’s index for Asia- Pacific equities has fallen almost 15 percent since July 24.

Most Asian currencies have weakened, losing between 1 percent and 10 percent of their value against the US dollar in the past month. The Indonesian rupiah slumped to a one-year low last week, as the gains this year in the Singapore dollar and the Korean won disappeared.

The price for a Masriadi painting, however, is rising.

On July 29, Larasati, a Jakarta-based auction house, sold his No More Games for $45,000, four times the presale mid-estimate. On August 12, with the global credit crunch looking a lot worse, Borobudur, another Indonesian auctioneer, sold The Billiard Player by the same artist for $55,000.

This will be reassuring to collectors at a time when prospects for art don’t look all that good, globally.

Billionaire California collector Eli Broad, who, earlier this year, forecast a crash such as the one that occurred in 1990s, now says prices will soften because “many of the buyers of contemporary art have been hedge-fund managers and other investors who obviously are having a difficult time and have lost lots of money.”

Radar blip

But that’s precisely why the credit squeeze may not catch up any time soon with Southeast Asian art, which, because it is still rather cheap, has escaped the attention of the financial crowd.

Hedge-fund managers in New York or London have had very little to do with Indonesian contemporaries, such as Handiwirman Sahputra, Putu Sutawijaya and Masriadi.

The interest in their works—or in those of Thai artist Natee Utarit and Filipino painter Geraldine Javier—is coming from collectors who want to buy Asian art but can no longer afford Chinese or Indian contemporary paintings, which have become quite expensive to acquire, thanks to a worldwide fascination with the culture of the world’s two fastest-growing major economies.

Chinese art is also being bid up by mainland collectors who, flush from a liquidity-driven rally in the stock market this year, have no dearth of cash to spend on collectibles.

Some of the pent-up demand for Chinese art is rubbing off on Southeast Asian creations.

Rising prices

“The collectors and dealers who have missed the Chinese boat are saying, ‘Hang on, here’s good art that’s only a 10th as expensive,”’ says art consultant Valentine Willie, who is advising an auction of contemporary Southeast Asian art in Singapore in October.

There’s no denying that prices of Southeast Asian art, too, have risen rather steeply in the past few years. Three years ago, a young artist such as Masriadi would have fetched no more than $1,500, says Valentine.

In the Christie’s Hong Kong auction, Javier’s The Absurdity of Being sold for $36,850. That was a whopping 16 times higher than the top estimate.

“Prices just skyrocketed, mostly tripling the mid-estimates,” Larasati said on its web site, after more than 90 percent of its works on offer got sold, the highest for the auction house in recent years.

Even after the recent price appreciation, Southeast Asian art is still inexpensive compared with works by contemporary Chinese artists, such as Zhang Xiaogang and Yue Minjun, whose paintings now sell for hundreds of thousands of dollars, as do those by Atul Dodiya, a Mumbai-based Indian painter.

Little to lose

Contemporary art is a speculative investment.

The producer of artistic works, being alive, can respond to burgeoning demand by supplying trash in large quantities.

There’s little risk of that happening in a hurry with the art of Thailand, Indonesia, Malaysia, Vietnam or the Philippines.

Contemporary Southeast Asian art is nowhere near bubble territory. Compared with the heady pre-Asian-crisis days, the price commanded by the current crop of young Southeast Asian painters and sculptors is chump change.

This may be one asset where investors have little to lose.

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With equities in the region slumping and currencies and bonds volatile, small investors in Asia don’t have many places to hide from the subprime rout.

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