Unsold and Million Dollar Withdrawals from Sotheby's New York

In 2010, the art market's recovery from the crisis began with the sale of an iconic Giacometti sculpture that achieved five times its conservative estimate, ending up at one of the most important collectors of the time. In retaliation, the full-blown crisis of the high-end art financial market began with the failed sale of a Giacometti bust estimated at $70 million on the evening of May 13 at Sotheby's New York . Over the past 15 years, the major auction houses have created a system increasingly tailored to investors and speculators by introducing derivative products, inflating estimates and pushing collectors to the margins. Now that interest rates are no longer negative and speculators are abandoning the market, only third-party guarantors remain to shore up their fall, until their liquidity runs out. Fortunately, the markets that have largely escaped the disease of financialization remain vital, thanks to the numerous non-billionaire collectors, as demonstrated by the Impressionist and Modern art catalogues that brought in $41.1 million at Christie's New York during the day, with high percentages of sales.

René Magritte's La Bonne Aventure Sells for $3.3 Million at Sotheby's

Lot 17, the large bust of Diego , brother of the sculptor Alberto Giacometti who executed it in 1955, was clearly overvalued, and the lack of third-party guarantees could be a choice of the seller, the Soloviev Foundation of the Solow family, or a lack of opportunity. In his lifetime, Stefan Solow was known to refuse offers of guarantees; but the imposition of a very high reserve of over $64 million proved excessive. The importance of the lot for the image and the outcome of the auction did not in fact allow it to be withdrawn as often happens in these cases nowadays, and the auctioneer had to declare it unsold. This further complicated the sale of the more than 40 subsequent lots, whereas previously a mix of third-party guarantees and low reserves had brought overall positive results.

La Jeune fille au bouquet by Fernand Léger, sold for $3 million at Sotheby's

The Giacometti was not an isolated case in the auction: of the 64 lots in the catalogue, four works with million-dollar estimates were withdrawn, among which a study for a composition by Kandinsky stands out, estimated at 6-8 million dollars, and nine remained unsold, several with million-dollar estimates and big names such as Matisse, Picasso, Soulages and van Rysselberghe . There could have been 10 unsold lots, but one lot guaranteed by the auction house, a figure by Leger , which initially remained unsold with an estimate of 5-7 million dollars, was reopened by the auctioneer who promptly sold it after a single raise to 3 million without commissions. The auction house probably preferred to limit the damage by paying the difference immediately, rather than find the work in storage. The overall result of 186 million dollars obviously did not reach pre-auction expectations.

Nearly half of the remaining 60 lots were guaranteed by third parties, and several appear to have ended up with guarantors, including Magritte 's million-dollar works 'La Bonne aventure' at $3.3 million at the low estimate, and Feininger 's Trumpeters at the low estimate of $5 million. Another Magritte work 'La traversee difficile', which came to auction unsecured with an estimate of $10-15 million, generated genuine interest from several quarters, finishing at $8.2 million, which with fees reaches the low estimate of $10 million: in the current market, lowering the reserve is a better strategy than guarantees. A sunny view of Venice by Paul Signac fared differently, saved by a single bid below the low estimate but forever at $8.1 million with fees. In addition to Magritte, two other artists have surpassed the $10 million mark: Picasso with a seated male figure from his later period, dated 1969, which stopped in the middle of its estimate of $12-18 million at $15.1 million, still too much for a decorative painting of any interest, and Georgia O'Keeffe with a characteristically decorative red flower that surpassed its high estimate at $13 million. Among the best results is a design work by the great architect Frank Lloyd Wright , a lamp from 1903-04 that reaches $7.5 million from an estimate of $3-5 million.

Bust of Diego by Alberto Giacometti, unsold

In fact, the market for quality works still exists, but not at the prices unreasonably pushed in the last five years. It is now the turn of the catalogues dedicated to contemporary art in the next two evenings in New York, on May 14 at Christie's and then again at Sotheby's the following day.