The Giant Bust Rocking the Art Market

Summary

The Journal Podcast Summary: "The Giant Bust Rocking the Art Market"

Release Date: May 19, 2025

Introduction

In the May 19, 2025 episode of The Journal, hosted by Ryan Knutson and Jessica Mendoza of The Wall Street Journal & Gimlet, the focus is on a seismic event in the art world: the unexpected flop of a highly anticipated Alberto Giacometti sculpture at a Sotheby's auction in New York. This episode delves into the implications of this event for the art market, explores changing trends among collectors, and examines what this signals about the current economic climate.

Background: Auction Week and the Art Market's Super Bowl

Andi Minoff sets the stage by highlighting the significance of auction week in New York, likening it to the "art world's version of the Super Bowl" (00:12). These high-profile auctions serve as critical moments for reassessing the value of some of the world's most coveted artworks. Kelly Crow, an esteemed art market journalist, provides her insights, noting, “it’s a very rare for a work, I think, at this price anymore to come to market naked” (07:03), emphasizing the rarity and significance of the event when no guarantor was involved.

The Auction Event: Giacometti’s "Grand Tete Mance" Fails to Sell

The centerpiece of the episode is the auction of Alberto Giacometti's bronze bust, "Grand Tete Mance" (Large Thin Head), estimated at $70 million. Kelly Crow recounts the atmosphere at Sotheby's New York headquarters, describing the setting as “a soaring, tall building built to sort of feel like a luxury shopping mall” with “polite women greeting you at every floor” and a packed auction room of around six to seven hundred people (01:21).

As the bidding commenced, the auctioneer started at $59 million, a figure that initially appeared promising given Giacometti's stature in the art world. However, despite the high expectations, no bidders stepped forward, leading to an audible collective gasp from the audience when the hammer fell without a sale (09:09). Kelly Crow describes the moment: “the collective gasp that came out of these 600 mouths in the room was so audible that it was really startling” (09:10).

Significance and Market Implications

The failure of such a high-profile sale raises alarms about the current state of the art market. Kelly Crow explains, “The art market is an alternative asset, just like real estate, you know, and it tells us how wealthy people see spend their money” (11:05). The reluctance to invest in a piece once thought to be a sure bet indicates potential unease among collectors regarding the broader economic and political climate. This event is reminiscent of the 2008 financial crisis, where nervousness among art collectors became evident (11:05).

Sotheby's chief executive reaffirmed the importance of the Giacometti piece despite its failure to sell, underscoring the complexity and volatility of the current market environment (09:40).

Comparing to Previous Trends: The $6.2 Million Banana

To contrast the failed auction, the podcast references a successful sale from December of the previous year: a banana taped to a wall that sold for $6.2 million, well above the $0.30 cost of an actual banana (12:01). Kelly Crow attributes its success to effective marketing and cultural resonance, noting, “You really have to capture a different level of attention to burst through” (12:25). This sale, while an outlier, suggested a willingness among collectors to invest in unique and culturally impactful pieces—an optimism that the recent Giacometti auction now calls into question.

Other Auction Highlights: Successes Amidst the Flop

Despite the headline failure, the auction week saw several notable successes that indicate shifting tastes among collectors. For instance:

• Frank Lloyd Wright Desk Lamp: Estimated between $3-5 million, it sold for $7.5 million, setting a new record for the designer at auction (13:48).

• Contemporary Works: Marlena Dumas' "Ms. January" fetched $13.6 million, marking a new record for a living female artist (14:09).

Kelly Crow interprets these sales as a pivot towards more beautiful and escapist art, rather than the previously dominant conceptual and politically charged pieces. She explains, “When real life is tough, you know, collecting is meant to be an escape... it's meant to be a respite” (14:29). This trend suggests that in times of economic uncertainty, collectors gravitate towards art that offers comfort and beauty rather than challenging or provocative works (15:26).

Conclusions: The Road Ahead for the Art Market

The episode concludes with reflections on the impact of the failed Giacometti auction. Kelly Crow suggests that this event may have a lingering effect on the market, as it was a true test of current collector sentiment (07:20). The reluctance to bid on such a high-profile piece indicates that auction houses like Sotheby's may need to recalibrate their strategies and pricing to align with the current economic mood (16:30). The art market’s sensitivity to broader economic indicators underscores the interconnectedness of luxury assets and global financial health.

Final Thoughts

"The Giant Bust Rocking the Art Market" provides an in-depth look into a pivotal moment for the art world, highlighting how a single auction event can reflect and influence broader market trends. Through expert insights and detailed recounting of the failed sale, the episode paints a nuanced picture of an art market navigating uncertainty, shifting tastes, and the ever-present tension between artistic value and economic value.

Notable Quotes

• Kelly Crow: “It’s a very rare for a work, I think, at this price anymore to come to market naked” (07:03).
• Kelly Crow: “The collective gasp that came out of these 600 mouths in the room was so audible that it was really startling” (09:10).
• Kelly Crow: “The art market is an alternative asset, just like real estate, you know, and it tells us how wealthy people see spend their money” (11:05).
• Kelly Crow: “You really have to capture a different level of attention to burst through” (12:25).
• Kelly Crow: “When real life is tough... collecting is meant to be an escape” (14:29).

Conclusion

This episode of The Journal serves as a poignant examination of the art market's current landscape, using the dramatic fallout of a single auction to explore larger economic and cultural shifts. For listeners and those interested in the intersections of art, economics, and societal trends, this episode offers valuable insights into how high-stakes auctions can serve as barometers for collective wealth and sentiment.

Transcript

[Andi Minoff]

Our colleague Kelly Crow covers the art market, and last week was a big one for her. It was auction week in New York.

[Kelly Crow]

Yeah, it's kind of the art world's version of the Super Bowl. The world's biggest auction houses roll out a series of sales that happen every night of the week. And for years, this has sort of served as a public reckoning moment to reassess price levels for hundreds of the world's most expensive artists.

[Andi Minoff]

Auction week showcases the biggest art sales. It's a chance for art watchers like Kelly to see which artists are hot and what kind of eye popping prices their work can command. And what was the hottest piece up for sale this auction week.

[Kelly Crow]

So heading into last week, all eyes were on this Alberto Giacometti sculpture, a bronze bust of the artist's younger brother Diego. It kind of came in with the highest estimate of the week at around $70 million.

[Andi Minoff]

Collectors and curators consider the bust a masterpiece. And Kelly was in the room when it went up for sale at the auction house Sotheby's New York headquarters.

[Kelly Crow]

It's this soaring, tall building built to sort of feel like a luxury shopping mall, if you will. There's escalators that run right up the middle with galleries ringing each floor. And so you kind of go up these series of esc and there's polite women greeting you at every floor. And everyone's in pinstripe suits and, you know, nice dresses. And you sort of make your way finally to this huge room that has it can seat around six or seven hundred people. And it was pretty packed. There it is. I'm sitting there watching it and I actually pulled out my phone and started Instagram living. Hey, guys, I'm here at Sotheby's. And here we go.

[Andi Minoff]

What happened next was unlike anything Kelly's seen at an auction for decades.

[Kelly Crow]

Oh, my goodness. The collective gasp that came out of these 600 mouths in the room was so audible that it was really startling.

[Andi Minoff]

Welcome to the Journal about money, business and power. I'm Andi Minoff. It's Monday, May 19th. Coming up on the show, an auction night shocker and what it says about the art market right now.

[Uber Ad]

This episode is brought to you by Uber. You know that feeling when someone shows up for you just when you need it most? That's what Uber is all about. Not just a ride or dinner at your door. It's how Uber helps you show up for the moments that matter. Because showing up can turn a tough day around or make a good one even better. Whatever it is, big or small. Uber is on the way, so you can be on yours. Uber on our way.

[Andi Minoff]

The Giacometti bus that went up for auction last week is called Grand Tete Mance, or Large Thin Head. It's a bronze sculpture about 2ft high of a man's head and shoulders. And it's called Large Thin Head for a reason.

[Kelly Crow]

So what you're seeing is it kind of depends on where you're standing. Like, from the side, you're gonna see a pretty gnarly, knobby portrait of a guy with spiky hair and big ears, and his mouth is sort of slightly opened and he has a collar, and it's just really his head and shoulders in a bust. What's interesting is if you stand it in front of it, it becomes kind of knife edge.

[Andi Minoff]

The creator of the piece is Alberto Giacometti, a Swiss Italian sculptor whose work reflects the horrors of World War II. He sculpted large Thin Head in the post war period in 1954.

[Kelly Crow]

Art really did change irrevocably after World War II. You just couldn't make pretty things. I mean, you see it in painting too, all these Jackson Pollock abstracts. Like the whole world just sort of exploded. And the artists were trying to figure out, how do we come back to art and make it matter differently? And so he sort of is known for creating these haunting figures.

[Andi Minoff]

Giacometti is one of the most important sculptors of the 20th century, and collectors pay big money for his work. Other casts of the bust have sold for over $50 million. And another Giacometti masterpiece, Pointing man, sold for over $140 million about a decade ago. All of which is to say, when this particular bust came up for auction, it was an event, and Sotheby's pulled out all the stops.

[Kelly Crow]

I feel like when I look at the Buse de Diego, I'm feeling human. There's something like he's nearly touching my soul.

[Andi Minoff]

Did you see the video that Sotheby's posted about this bust heading into the auction?

[Kelly Crow]

I mean, the marketing's pretty spectacular, right?

[Andi Minoff]

This is substantial, monumental.

[Shopify Ad]

This is his magnum opus of what.

[Kelly Crow]

Man is, of what Diego is, of what humanity is. It has a mystical presence or a divine presence.

[Andi Minoff]

You get that duality. You get that it's both of this world, but also at the same time, it's transcendent.

[Kelly Crow]

They do a pretty good job job of making these things seem like, you know, once in a lifetime opportunity.

[Andi Minoff]

I mean, they were laying it on pretty thick.

[Kelly Crow]

Yeah, yeah. I mean, that's their job. That's why people bring things to auction rather than just take it to a dealer and sell it privately.

[Andi Minoff]

But a public auction does present a risk. What if the piece doesn't sell? To get around that, auction houses like Sotheby's will often find what's called a guarantor. Somebody willing to buy the piece for an undisclosed price to. Just in case no one steps up during the auction. In exchange for that guarantee, Sotheby's will typically take a bigger cut of the sale price. But in this case, the seller didn't want a guarantor. Large Thin Head was being sold by a foundation tied to the late real estate tycoon Sheldon Solow, and the Solow family was feeling confident.

[Kelly Crow]

Solow was a famous collector, and his son believes that his dad had really good taste. And so what that has created is a scenario where, you know, they're pretty sure what the work is worth and they're not known to budge on that. Right. So I don't think Sotheby's had a lot of options.

[Andi Minoff]

The bust would hit the auction block without a guarantor.

[Kelly Crow]

To go up naked is what we say in auction parlance. It's very rare for a work, I think, at this price anymore to come to market naked. Which, to be honest, was really refreshing for someone like me who likes to sort of see, like, you know.

[Andi Minoff]

Because it's a true test.

[Kelly Crow]

Yeah, it's a true test of sort of how the market is and where the price, you know, you know, should be and could be.

[Andi Minoff]

Which brings us to Tuesday night and that packed auction room. The auctioneer started the bidding at $59 million.

[Kelly Crow]

Now, for a minute, that seems like a good deal, because the folks who knew Giacometti knew that other pieces of his, you know, had sold for far more, like over $100 million. He doesn't have a bidder yet, but he's trying 64. Let's see how it does.

[Andi Minoff]

Even without a bidder, the auctioneer began raising the price tag, bringing it all the way up to the reserve price, the minimum that the seller would accept.

[Kelly Crow]

He finally comes up to about $64 million. And then the room just hushes. Like people who had brought out their cell phones at first just to sort of catalog the thing, just like I was doing. They start, like, putting their phones down, which is never a good sign. And people start looking around at each other. Like, it gets, like, awkward, silent. The room has gotten very quiet. He's sort of stalling it. At 64 with two, he just needs one bid. They can't do it everyone's sort of waiting with bated breath for one of them to take the bait. And then four minutes later, they didn't.

[Andi Minoff]

$215,000.

[Kelly Crow]

And then when the hammer, you know, came down, the collective gasp that came out of these 600 mouths in the room was so audible that it was really startling.

[Andi Minoff]

No one stepped up to buy the most anticipated piece of the week. There wasn't a single single bidder.

[Kelly Crow]

The thing flopped.

[Andi Minoff]

Sotheby's chief executive said that the auction house stands by the importance of the Giacometti piece. What this bust bust says about the art market that's.

[Shopify Ad]

Starting a business can seem like a daunting task unless you have a partner like Shopify. They have the tools you need to start and grow your business. From designing a website to marketing, to selling and beyond, Shopify can help with everything you need. There's a reason millions of companies like Mattel, Heinz and Allbirds continue to trust and use them. With Shopify on your side, turn your big business idea into sign up for your $1 per month [e-mail] specialoff.

[Andi Minoff]

What was your reaction in that moment when you realized this thing isn't gonna sell?

[Kelly Crow]

Well, immediately my heart starts racing, right, because, you know, I've been covering the art market for 20 odd years. I mean, I have to go Back to like 2008 to remember a piece that sold at this level, you know, this badly or didn't sell right at this level, this valley.

[Andi Minoff]

Luxury markets like the art market can be a powerful economic indicator. In 2008, art collectors were nervous. This flop might be a sign that they're nervous again. A Sotheby's executive made the point that collectors might be concerned about the current political and economic turmoil.

[Kelly Crow]

The art market is an alternative asset, just like real estate, you know, and it tells us how wealthy people see spend their money. And you kind of want to see how the world's wealthiest people, who are arguably more insulated than the rest of us, how confident or wary are they to go big or go home? You know, when it comes to these artworks that are over $30 million, over $50 million, it's a very small pool of people to begin with, but you can glean a lot about how they feel about the, the overall market's health by seeing how willing they are to go shopping.

[Andi Minoff]

Just a few months ago, it seemed like they were willing at least for the right piece. We talked to you not long ago in December about this banana taped to the wall that sold for $6 million.

[Kelly Crow]

The banana at the grocery store costs about 30 cents. This one just sold for $6.2 million.

[Andi Minoff]

Which the cryptocurrency entrepreneur paid more than.

[Kelly Crow]

$6 million for this piece. At an art auction last night, an Italian artist.

[Andi Minoff]

That seemed to be a good sign for the art market at the time. Like, people were definitely feeling spendy. Was that a red herring?

[Kelly Crow]

I'm not sure if it was a red herring or if it was just like the great sort of theater. Right. You know, it went viral from the moment it was taped up to the wall at the fair. It had a whole backstory that this generation of collectors and, and folks on Instagram, you know, were dressing as this banana for Halloween. It sort of had this pop culture breakthrough. You know, I just think you really have to capture a different level of attention to burst through.

[Andi Minoff]

Maybe the banana was an exception or maybe the economic mood really has changed since December.

[Kelly Crow]

We could look at how Wall street was doing, you know, at the, at the end of last year versus, you know, how it was doing three months ago when a lot of this property was getting gathered for this sale as opposed to how it's doing. Right.

[Andi Minoff]

Like, very different kind of mood about the economy.

[Kelly Crow]

Yeah. Very roller coaster, very volatile. And the tariffs are a factor. And so all these little factors can affect a collector sitting in the room or sitting on their computer watching something sell. What makes them push the button and what makes them not.

[Andi Minoff]

The whole week wasn't a bust. There were some notable success stories.

[Kelly Crow]

People did buy things. They weren't buying things really for more than $16 million, but, but they were. And like, and, and sort of some fluky things sort of did very well. The Frank Lloyd Wright desk lamp was estimated to sell for three to five million dollars. And the thing sold for like seven and a half million dollars. Like a record for Frank Lloyd Wright at auction.

[Andi Minoff]

Some contemporary pieces did well too, like artist Marlena Dumas, Ms. January, which sold for 13.6 million. It set a new record for a living female artist. So what did these pieces that did sell kind of show us about changing tastes? Are people looking for something different right now?

[Kelly Crow]

Yes, there are some taste changes and every market cycles differently, but little truths sort of emerge from each one. And this one, it's gonna sound so overly simplistic, but beautiful. Things sold really well this season. That seems like a no brainer. Yeah, but, but in fact, a few years ago when conceptual art was all the rage and when sort of snarky, cynical, like, you know, if you don't get the joke of the banana Right. Like you don't understand it. Like, there was a time very recently when calling something beautiful or and dealer parlance, calling it decorative was really a slam. Like, ooh, that's a decorative piece, meaning that it was pretty. It wasn't tough, it didn't have some political bite. This week we really saw really beautiful things sell. Well, I asked some folks about this and they basically just said, like, you know, when real life is tough, you know, collecting is meant to be an escape.

[Andi Minoff]

You retreat to beauty.

[Kelly Crow]

Yeah. It's meant to be a respite. And it's not a moment where people really want to be challenged with the toughness of art. They really want to be consoled by the beauty of it. And so this is why, perhaps the Giacometti, which reminds us of the angst and the existential crises that followed World War II, maybe it just didn't have that moment.

[Andi Minoff]

What do the sellers of this bus do now?

[Kelly Crow]

So they get it back. They may just take a breath and make sure that, you know, the vultures don't sort of scoop it up at a bargain basement prices. It's known as burning the work. Right. So you've put this work up to the world to say, I think I want to get this price. And when everyone watches it, not get that price, like, there's no shot you're ever going to get anything close to that price for a very long time. You sort of burned the work. Yeah. You're sunk. And so at the very least, you're knocking probably 20 million off this work.

[Andi Minoff]

How long could this bust, bust cast a shadow over the art market? Is this something that people are going to be able to move past quickly or will it linger?

[Kelly Crow]

I don't think they're going to move past it quickly. No. What auctioneers want is for everyone to feel safe and okay buying art. That's what sellers want so that they can get a good bang for their buck. That's what estates want so they can offload things and. But honestly, collectors, you know, with the paddles make the call. And if they're still a little nervous, then the houses are going to have to be really careful about where they price things.

[Andi Minoff]

That's all for today. Monday, May 19. The Journal is a co production of Spotify and the Wall Street Journal. If you like our show, follow us on Spotify or wherever you get your podcasts. We're out every Weekday afternoon. Thanks for listening. See you tomorrow.