I try to formulate a question about the correlation between making money as a consultant and overpaying for art. When consultants are on commission, they don’t earn anything unless they buy. When they’re on a retainer, no such conflict of interest gets in the way of the job. But as I struggle for the right words to broach this delicate subject, Ségalot looks at his watch. A flash of alarm crosses his face. He apologizes, stands up, pays the bill, and says, “It has been my pleasure.”
I sit, finishing my water and collecting my thoughts. Ségalot is infectiously zealous. We had been sitting for almost an hour and he had spoken with absolute conviction the entire time. This is a talent essential to his job. On one level, the art market is understood as the supply and demand of art, but on another, it is an economy of belief. “Art is only worth what someone is willing to pay for it” is the operating cliché. Although this may suggest the relationship between a con artist and his mark, the people who do well believe every word they say—at least at the moment they say it. The auction process is about managing confidence on all levels—confidence that the artist is and will continue to be culturally significant, confidence that the work is a good one, confidence that others will not withdraw their financial support.
6:35
P.M.
The doors in the two-story glass wall of Christie’s lobby revolve continuously with a steady flow of ticket holders. Many dealers and consultants are already here, as the evening sale is an opportunity to meet and greet “the money.” In the queue for the coat check, and again in the line to pick up paddles for bidding, people speculate about which objects are going to do well and who is likely to buy what. Everybody knows something. People drop their voices when they utter a name or a lot number, so you tend to hear only the verdict: “That’s going to fly” or “That estimate is way off.” As people part ways to go to their seats, collectors say to each other “Good luck” and “See you in Miami.” It’s all gleaming smiles.
The crowd is international. You hear a lot of French in an array of Belgian, Swiss, and Parisian accents. Belgium and Switzerland probably have the highest per capita ratios of contemporary art collectors. Until World War II, France was the center for buying and selling art. From after the war to the early 1980s, London was the auction capital, but now the British city is a secondary site, where the buyers tend to bid over the phone. Looking at this busy scene, it is hard to believe that New York was a provincial outpost of the art business until the late 1970s. Christie’s started holding auctions here only in 1977, but now, in the words of one Christie’s expert, “The market is alive—all the major players are in the room.”
I see David Teiger, a New York–based collector in his late seventies. He is talking to a well-preserved woman close to his own age.
“What period do you collect?” she asks.
“This morning,” he responds.
“You like art by young artists?” she asks earnestly.
“I don’t necessarily like it, but I buy it,” he jokes.
“So…are you bidding tonight?”
“No. I don’t come here to buy. I come to smell the perfume—the aroma of what is in the oven—to gauge where the public is going. That is nothing to do with where I might go. I’ll go somewhere overlooked or undervalued.”
Teiger prides himself on his independence; auctions have too much of a pack mentality for him. He bought Andy Warhol out of the Stable Gallery’s show in 1963. “You know how much I paid for it?” he says. “Seven hundred and twenty dollars! Do you know when MoMA bought their first Warhol? 1982!” Having done that, why would he want to spend $10 million on a lesser Warhol now? It wouldn’t sit right with his adventurous self-image. He’s not that kind of collector.
So who buys at auction? Many “serious” collectors of contemporary art buy from primary dealers. It’s a lot cheaper, if a lot riskier, to be ahead of the curve. On the secondary or resale market, the risk is lower, because the work has been market-tested. All art is “priceless,” but assurance is expensive. A small percentage of collectors buy only at auction. “They like the discipline of the deadline,” explains a Sotheby’s director. “They’re very busy, so the sale makes them get their act together. They like the open nature of the auction, especially if there is a visible underbidder willing to pay a similar price. They also like the certainty that they’ve paid a market price on a given day in a given location.”
One reason to buy at auction is to avoid the time-consuming politicking expected by primary dealers, who, in the interest of building their artists’ careers, try to sell only to collectors who have the right reputation. The lines to buy work, particularly by painters with limited annual output, can be very long—so long, in fact, that many may never be deemed elite or erudite enough to be “offered a work.” Some auction house people complain of the “complete lack of material on the market” and the “undemocratic” way in which primary dealers go about their business. “Quite frankly,” declares a Sotheby’s expert, “I think the waiting lists are obscene. An auction gets rid of these hierarchical lists, because you can jump straight to the head of the queue just by putting your hand up last.”
At 6:50
P.M
. I climb the stairs to the salesroom and join the members of the press, who are herded into a cramped standing-room area cordoned off by a red rope. The spatial arrangement suggests that the press should know its place. At a Sotheby’s Old Masters sale, we were given humiliatingly huge white stickers that said
PRESS
. In the hierarchy of this world of money and power, the reporters are visibly at the bottom. As one collector said of a particular journalist, “He obviously doesn’t get paid very much. He doesn’t really have access to important people, so he’s reliant on scraps to put his articles together. It’s not much fun hanging around at the big table when you’re not wanted there.”
One journalist, who writes for the
New York Times
, is an exception to the rule. Carol Vogel has an assigned seat in front of the red cordon that allows her to get up and strut up and down in front of the press pack in her high-heeled boots and gray bob. She is the haughty embodiment of the power of her newspaper. I see Ms. Vogel talking to some of the top dealers and collectors. She obtains access because they want to influence her reports, even if their tips and insights amount to little more than generous helpings of spin.
In the center of this jostling press pen is Josh Baer. He is not actually a journalist, but for over ten years he’s been sending out an electronic newsletter called
The Baer Faxt
that reports on, among other things, who is buying and underbidding at the auctions. Baer looks a bit like Richard Gere; he’s a cool New Yorker with thick silver hair and black-rimmed glasses. His mother is a minimalist painter of some repute and he ran a gallery for ten years, so he knows the milieu well. “The newsletter contributes to the illusion of transparency,” he admits. “People are overinformed and undereducated. They have this veneer of knowledge. They look at a painting and they see its price. They think the only value is an auction value.” Although the art world in general and the art market in particular are opaque, when you are part of the confidential inner circle, there are fewer secrets. As Baer explains, “People like to talk about themselves and to show that they know what they know. I’m fighting that urge right now—I have to fight the impulse to try to impress you that I am important.”
Most of the reporters here are interested in a narrow band of information. They take note of the prices and try to see who is bidding and buying. None of them are critics. They don’t write about art, but trade in the currency of knowing who does what. One journalist is “paddle spotting,” or writing down the numbers of people’s paddles as they walk in so that later, when people are bidding, he can tell who bought the work when the auctioneer confirms the number aloud. Others are trying to clock who is sitting where. The reporters grumble about their cramped quarters and their difficult sight lines. They laugh at the pompous collector who has been given a “bad seat” and banter about the best way to describe someone who is making his way to his chair. “Distinctive,” says the understated British correspondent. “Vulgar,” says Baer. “A clown,” says an emphatic voice from the back of the pack.
The salesroom seats a thousand people, but it looks more intimate. One’s seat is a mark of status and a point of pride. Smack dab in the middle of the room, I see Jack and Juliette Gold (not their real names), a pair of avid collectors, married with no kids, in their late forties. They fly into New York every May and November, stay in their favorite room at the Four Seasons, and arrange to have dinner with friends at Sette Mezzo and Bal thazar. “The truth is,” confides Juliette later, “you’ve got standing room, the terrible seats, the good seats, the very good seats, and the aisle seats—they are the best. You’ve got the big collectors who buy—they’re at the front, slightly to the right. You have serious collectors who don’t buy—they’re toward the back. Then, of course, you have the vendors, who are hiding up in the private skyboxes. It’s a whole ceremony. With few exceptions, everyone sits in exactly the same spot they did last season.” Another collector told me that the evening sale was like “going to synagogue on the High Holidays. Everyone knows everybody else, but they only see each other three times a year, so they are chatting and catching up.” Anecdotes abound about unnamed collectors who became so immersed in gossip that they forgot to bid.
Part of the pleasure of the auctions is the opportunity to be seen. Juliette is wearing a Missoni dress with no jewelry except for a whopping vintage Cartier diamond ring. (“It’s dangerous to wear Prada,” she warns. “You might get caught in the same outfit as three members of Christie’s staff.”) Jack sports a discreetly pinstriped Zegna suit with a cobalt-blue Hermès tie. Sometimes Jack and Juliette buy, sometimes they sell, but mostly they come because they love the sales. Juliette is a romantic whose European parents collected art, and Jack is a pragmatist whose stock and property business influences his perspective. Juliette told me that “an auction is like an opera with a language that you need to decipher.” Jack seems to agree but ultimately describes a very different event: “Yes, even if you don’t have a direct interest in the sale, you’re emotionally involved because you’ll own similar works by ten of the artists. An auction is an instant evaluation.”
Tonight’s auction is more than a series of sixty-four straightforward business deals; it is a kaleidoscope of conflicting interpretations and financial agendas. When I asked the couple why they thought collecting had become so popular in recent years, Juliette spoke about how so many more people were coming to understand that art could enrich their lives. Jack, by contrast, thinks it’s because art has become an accepted way of “diversifying your investment portfolio.” Although it offends the sensibilities of older “pure collectors,” he says, the “new collectors, who have been making their money in hedge funds, are very aware of alternatives for their money. Cash pays so little return now that to invest in art doesn’t seem like such a dumb idea. That’s why the art market’s been so strong—because there are few better options. If the stock market had two or three consecutive quarters of large growth, then, perversely, the art market might have a problem.”
The art world is so small and resolutely insular that it is not much affected by political problems. “At the sales after September eleventh,” explains Juliette, “you had absolutely no sense of the reality of the world outside. None whatsoever. I remember sitting in the sale that November and saying to Jack, ‘We’re going to come out of this room and the Twin Towers will be standing and everything will be good with the world.’”
Major disasters may not have an impact, but casual gossip has the power to break a work. Jack told me a story about friends who sold off their grandmother’s collection. “There was this beautiful Agnes Martin painting, but somehow the word got around that if you looked at it upside down, in a certain light, with your eyes closed, it was damaged. So the whole art world suddenly took that as gospel. That probably knocked half a million dollars off the price—just because some idiot started a rumor. Conversely, when word gets out that an artist is going to move to Larry, everyone wants to buy a work before the prices go nuts.” He was referring to Larry Gagosian, one of the most powerful art dealers in the world, with galleries in New York, Los Angeles, London, and Rome, who invariably raises an artist’s prices by 50 percent when he starts representing him or her.
Most people confess to enjoying the intrigue. However, the competitive underside to the conversations is unbearable for some. A London dealer who wishes he could avoid the auctions explained: “Between you and me, everyone is so full of shit. The people are all running after each other. The chat is full of subterfuge and sleazy art world stories. It’s like a tableau vivant of pretentious greed. You walk in, and everyone’s so happy and ‘How are you?’ when all they want to do is screw you.”
At 7:01
P.M
., as a few stragglers struggle to their seats, Christopher Burge whacks his gavel. “Good evening, ladies and gentlemen. Welcome to Christie’s and to this evening’s sale of postwar and contemporary art.” He reads out the rules about conditions of sale, commission fees, and taxes. Burge calls out “Lot one” and starts the bidding off: “Forty-four thousand, forty-eight thousand, fifty thousand, fifty-five thousand.” He seems more relaxed than he was when the room was empty. To his left, a large black-and-white scoreboard or currency converter records the sums in U.S. dollars, euros, pounds sterling, Japanese yen, Swiss francs, and Hong Kong dollars. To his right, a screen depicts a color slide so the audience can be certain which work is on the block. To both sides of Burge are rows of Christie’s staff standing in two wooden enclosures that look like jury boxes. Many of them are on the phone, talking to people who are, or soon will be, bidding. Some buyers are not in town, and others want to protect their anonymity. Someone like Charles Saatchi, the advertising mogul turned secondary-market art dealer, never comes to the sales. Very conscious of publicity, he either bids on the phone or sends someone to bid in the room. If he wins a work, particularly for a record price, he can make it well-known after the fact. If he loses one, no one is the wiser and he doesn’t lose face.