The Journal. - The Giant Bust Rocking the Art Market

Episode Date: May 19, 2025

It was supposed to be the highlight of New York’s spring auction week: Sculptor Alberto Giacometti’s masterpiece “Large Thin Head” was this year’s most hotly anticipated piece up for sale. But when the bidding opened, collectors went silent. WSJ’s Kelly Crow explains what this unexpected auction week bust reveals about today’s art market. Annie Minoff hosts.  Further Listening: - The $6 Million Banana's Appeal  - Is This Painting a Masterpiece? AI Is On the Case  - The Basquiat Sisters on Managing One of Art's Hottest Brands  Sign up for WSJ’s free What’s News newsletter.  Learn more about your ad choices. Visit megaphone.fm/adchoices

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

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? 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. 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. 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 escalators and there's polite women greeting you at every floor.

And everyone's in pinstripe suits and you know, nice dresses and sort of make your way finally to this huge room that has, you can see it 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 Tivies.

And here we go. What happened next was unlike anything Kelly's seen at an auction for decades. Oh my goodness. The collective gasp that came out of these 600 mouths in the room was so audible that it was really startling. Welcome to The Journal, our show about money, business, and power. I'm Annie 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. The Giacometti bust that went up for auction last week is called Grand Tete Mance, or

Large Thin Head. It's a bronze sculpture about two feet high of a man's head and shoulders. And it's called Large Thin Head for a reason. So what you're seeing is, it kind of depends on where you're standing. Like, from the side, you're going to 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 in front of it, it becomes kind of knife edge. 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. 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. The whole world just sort of exploded and the artists are 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. 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 $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. ["Sotheby's"] I feel like when I look at the bus de Diego, I'm feeling human. There's something, it's like he's nearly touching my soul. Did you see the video that Sotheby's posted about this bus heading into the auction?

I mean, the marketing's pretty spectacular, right? This is substantial, monumental. This is his magnum opus of what man is, of what Diego is, of what humanity is. It has a mystical presence or a divine presence. You get that duality. You get that it's both of this world, but also at the same time it's transcendent. They do a pretty good job of making these things seem like, you know, once in a lifetime opportunities.

I mean, they were laying it on pretty thick. 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. 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 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 to guarantee her. Large Thin Head was being sold by a foundation tied to the late real estate tycoon Sheldon Solo. And the Solo family was feeling confident.

Solo 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. The bust would hit the auction block without a guarantor. 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. Because it's a true test. Yeah, it's a true test of sort of how the market is and where the price, you know, should be and could be. Which brings us to Tuesday night, in that packed auction room. The auctioneer started the bidding at $59 million. 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. Let's see how it does. 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. 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. at each other, like it gets like awkward, silent. The room has gotten very quiet. He's sort of stalling it at 64.2. He just needs one bed. 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. 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. No one stepped up to buy the most anticipated piece of the week. There wasn't a single bitter. The thing flopped. 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 next. You know, you could hit pause when you needed to, or hit rewind, like that time you knocked down that wasps nest. Uh-oh. Well, life doesn't always give you time to change the outcome, but pre-diabetes does. With early diagnosis and a few healthy changes, you can stop pre-diabetes

before it leads to type 2 diabetes. To learn your risk, take the one-minute test today at doihaveprediabetes.org, brought to you by the Ad Council and its prediabetes awareness partners. What was your reaction in that moment when you realized this thing isn't going to sell? Well immediately my heart starts racing, right? Because 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 badly. 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. The art market is an alternative asset,

just like real estate, you know, and it tells us how wealthy people 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 overall market's health by seeing how willing they are to go shopping.

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 six million dollars. The banana at the grocery store costs about 30 cents. This one just sold for 6.2 million dollars. The cryptocurrency entrepreneur paid more than six million dollars for this piece at an art auction last night. And that seemed to be a good sign for the art market at the time. People were definitely feeling Spendee. Was that a red herring?

I'm not sure if it was a red herring or if it was just the great theater. 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 young people 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. Maybe the banana was an exception, or maybe the economic mood really has changed since December. We could look at how Wall Street was doing, you know, 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 the sale as opposed to how it's doing now, right? Very different kind of mood about the economy. 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?

The whole week wasn't a bust. There were some notable success stories. People did buy things. They weren't buying things really for more than $16 million, but they were. And sort of some fluky things sort of did very well. This Frank Lloyd Wright desk lamp was estimated to sell for $3 to $5 million, and the thing sold for like $7.5 million, like a record for Frank Lloyd Wright at auction. Some contemporary pieces did well too, like artist Marlana Dumas' Miss 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? 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 going to 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 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, 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.

You retreat to beauty. 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. What do the sellers of this bus do now? 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. 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? 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. 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. That's all for today, Monday, May 19th. 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.