On November 12, 2014, the auction house Christie's hosted its annual fall auction of major works of postwar and contemporary art in New York. With sales totaling $852.9 million, the auction now stands as the highest-grossing auction in history, and has led some to speculate that the billion-dollar auction is imminent. In this episode, Natasha Degen, an expert on the art market, joins us in discussing how the art market works, as well as its history and future, and its relationship to larger social and economic trends.
Check out the Slideshow below for images of the world's hottest auction house, and the most expensive work ever sold at auction. Scroll down further for our Postscript (stuff that didn't make it into the episode), in which Tina and Natasha discuss the increasing similarity between auction houses, galleries, and even museums. At the bottom of the page, you'll find Links to other sites for more information and News Updates on the market.
Tina: Ever since I moved to New York and began paying more attention to auctions, I've noticed that it's amazing how much they can resemble non-commercial exhibitions. For those of you who've never been to an auction house, the works being auctioned are up on display beforehand, so that anyone can walk in and look at them, as if they were going to a museum exhibition. Furthermore, as Natasha mentioned, there are catalogs for the auctions, containing entries on each work of art, as well as an essay that ties the whole sale together--just like you might find in a catalog for a museum show. I wonder if this phenomenon of auctions being treated like exhibitions is a more recent development, or is there a precedent?
Natasha: Certainly, auctions have been getting more and more lavish, but they have a historical precedent from the late 1950s. For example, there was the famous "Goldschmidt sale" at Sotheby's in 1958, which was a very exclusive sale of a single collection, with only seven works. The whole sale lasted only about 22 minutes, but it broke many records for Impressionist and Post-Impressionist art. The sale was also famous because Sotheby's invited celebrities, including Kirk Douglas and Anthony Quinn, who played Vincent Van Gogh and Paul Gauguin respectively in the 1956 film Lust for Life. So there certainly is a precedent to how auction houses today use catalogs, celebrities, and other forms of marketing to signify how exclusive and historically important the work being auctioned is. This trend has only accelerated; similar to the way that the September issue of Vogue only gets larger and larger every year, auction catalogs only get more and more expensive, opulent, and lavish. For example, some of Christie's recent catalogs came in a box, with pullout photographs of the works on high-grade paper. Given how much this all costs them, one might wonder: Why are the auction houses willing to forgo some of their profit for these evening sales? It's because they've become marketing events: Christie's wants to be known as the most exclusive and successful auction house, and to be associated with the apex of extravagant, cultured living. The evening sales feed into that, and that's one of the reasons why the profits have become less important.
Tina: A few years ago, I started to hear a lot of grumbling about the way that auction houses were acting more and more like galleries (in that they were entering the primary market), while both auction houses and galleries were acting more and more like museums (in that they were mounting museum-like exhibitions, and increasingly were willing to sacrifice profit for prestige, as you discussed). [See, for example, the October 2012 article "Battle for private selling shows" in The Art Newspaper.] There was a sense that as everyone got bigger, the field of objects and the range of strategies or tactics got more homogenized across the art market and the art world more broadly--and that maybe that wasn't a good thing.
Natasha: Absolutely. For example, the auction houses even went so far as to acquire dealers, as when Christie's bought Haunch of Venison, a gallery for contemporary art, which recently was folded into their private sales department. Sotheby's also bought an Old Master's dealer based out of Amsterdam, Noortman Fine Art. Why would auction houses want to acquire dealers? It's a way to expand their activities, but perhaps more importantly, it's also a way for them to get access to art fairs, which is an increasingly important part of the market. (Only galleries and dealers, not auction houses or individual artists, are allowed to rent space in most art fairs.) Understandably, there was a lot of pushback against these moves; dealers felt that the auction houses were challenging their business by treading on their territory. But conversely, galleries themselves are treading on the territory of the global auction houses, as they are proliferating to an insane extent: Gagosian has thirteen locations worldwide; Pace has locations in New York but also on the West Coast and in China; White Cube is expanding in London and also into Brazil. They can now compete with the auction houses, because they have the resources to do that. It's the mid-level galleries that are getting squeezed, as they can't compete with either the entry-level galleries or the mega-galleries and auction houses; that's unfortunate for the art market of the future.
Christie's Post-war and Contemporary Art Auction, New York, November 2014
Andrea Fraser, "L'1%, C'est moi"
Essex Street, "The Contract" (gallery show)
William Powhida, Why Do We Expect Artists to Work for Free?
Artrank.com (uses algorithms to determine whether you should buy or liquidate an artist's works)
Olav Velthuis, "Artrank and the Flippers: Apocalypse Now?," Texte zur Kunst, December 2014
Edward Lucie-Smith, National Gallery of London Sheds New Light on First Modern Art Dealer and Impressionist Champion Paul Durand-Ruel, ArtNet
Aug. 18, 2014: Barbarians at the Art Auction Gates? Not to Worry, New York Times
Nov. 12: Christie's Contemporary Art Sale Nets $852.9 million, All-Time Auction Record, ARTnews
Nov. 13: A Warhol Leads a Night of Soaring Prices at Christie's, New York Times
Nov. 18: Of Spec-U-Lectors and Drug-Dealing Art Advisers, ARTnews
Dec. 5: We Need to Reconsider Art School, Vulture @ NY Magazine
Dec. 12: Speculation Swirls as New Christie's Boss Gets Going, Wall Street Journal
Dec. 18: Who Are the Most Collectible Living Artists?, Artnet
Dec. 19: Gaga's Law: How Art Conquered Pop, Vulture @ NY Magazine
Dec. 23: The Top Ten Auction Lots of 2014, ARTnews
Jan. 3, 2015: Masterpieces Market Exceeds $50 billion in size in 2014, Yields 4.9 Percent Average Return, ARTnews
Jan. 8: Sotheby's and Christie's Return to Guaranteeing Art Prices, New York Times
Jan. 20: Guess What? 2014 Was a Record Year at Auction, The Art Newspaper
Jan. 22: "Dr. Doom" Predicts Art Market Trouble, ARTnews
March 25: $140 Million Picasso at Christie's Is World's Most Expensive Painting at Auction, Artnet