(7 of 7)
The auction as a news and social spectacular came to full flower with Sotheby's acquisition of Manhattan's Parke-Bernet in 1964. Christie's, its more decorous rival, came to New York 13 years later and has been more cautious about expanding worldwide. (Sotheby's has 42 international bases, Christie's 29.) Not totally tongue in cheek, Christie's maintains that "Sotheby's is a businessman pretending to be a gentleman, while Christie's is a gentleman pretending to be a businessman."
To some critics, the auction houses' success is excessive. While no one blames them for dizzy prices—they are not their bidders' keepers—even dealers who are making wild profits as a result of the art boom evince a certain distaste for the whole process. London's Waddington points out that the auction world's Big Two, unlike most thriving corporations, do not plow back even part of their profits into research, grants for young artists or gifts to museums. Says he: "They are simply dealing in commodities." There is a gavel-size black cloud over the Big Two, however. Christie's, closely followed in London by Sotheby's, in 1975 tacked a 10% buyer's premium on all sales (in addition to the average 10% commission charged the seller). English dealers with American backing sued the two firms for collusion and restraint of trade. The case will not even come to trial for an other year; in the U.S., where the same surcharge has been levied, a dealer's suit may be played all over again.
A far more controversial move was made by Sotheby's last summer. The company announced that it had entered into an agreement with Citibank, the second largest banking organization in the U.S., to assist the bank's millionaire clients in acquiring artworks for investment. Though Sotheby's insists that the arrangement contains sufficient built-in checks and balances to dispel any suspicion of conflict of interest, many people in the art world are skeptical of any deal whereby an auction house may in effect end up supporting its own market. Says David Bathurst, Christie's New York president: "Using art as an investment scares the hell out of me. There's going to be a flood of money in and out, leaving a sound market devastated because of people who shouldn't have been there in the first place."
That may be an exaggeration. The wealthy and the powerful have invested in art from time immemorial, though it is true that the great collections have been amassed by acquisitors possessed of taste and love for the objects they buy. They have not generally been dis couraged by hard times. On the contrary, in recessions and depressions and inflations, the smart ones tend to liquidate stocks, bonds and real estate and thus have all the more cash to invest in other fields. Like art. Given the scar city of beautiful things and the insatiable demand for them, the sales will undoubtedly continue to take the bread and make the circuses. The Romans would love it. — Michael Demarest
*The two highest: Velazquez's Portrait of Juan de Pareja, $5.5 million, in 1970; Titian's Death of Actaeon, $4 million, in 1971.