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In June, Sotheby’s announced that it would be relocating its flagship New York salerooms to the Breuer Building in Madison Avenue, the former home of the Whitney Museum of American Art and, more recently, the Metropolitan Museum of Art’s Modern and contemporary outpost. Dating from 1966, this Brutalist-style landmark was designed by Marcel Breuer, who in the 1920s had been one of the Bauhaus School’s most influential teachers. Sotheby’s has bought the building for a reported $100m.

Some view this as a symbolic moment. A revered public museum turns into a sales outlet for art, sneakers, handbags, watches, jewels and other luxury stuff for the rich.

“The old, wonderful Whitney Museum will be turned into a showroom, open to the public only when something is for sale. It’s the zeitgeist and it’s very sad,” says the New York-based artist, Deborah Kass, a graduate of the Whitney Museum Independent Studies Program.

There is, of course, a long history of buildings of historical and architectural interest being repurposed. Plenty of churches have been turned into restaurants and luxury homes. Plenty of royal palaces have been turned into art museums. The Polish entrepreneur Grażyna Kulczyk has recently turned a 12th-century Swiss monastery into a museum for works exclusively by women artists.

But still, doesn’t the fate of the Breuer Building signify a moment of some kind of cultural significance? To understand what that might be, it is worth shifting focus from New York to Paris to have a look at the current Money in Art show at the Monnaie de Paris. On view in the city’s historic mint, a building designed—quite literally—to make money, this rambling, didactic but thought-provoking exhibition charts the complex relationship between art and money from antiquity to the present day. Information boards eruditely reference the philosophers Adam Smith, Karl Marx, Georges Bataille and Guy Debord—and Andy Warhol, whose large-scale 1981 Dollar Sign silkscreen is an obligatory exhibit.

The show convincingly demonstrates that what we now recognise as the “financialisation” of art, as distinct from its age-old wider art market, dates back to the early 19th century. Gambling casinos were legalised in France in 1806. The Paris stock exchange opened in 1826, spawning a new professional class of bankers and speculators who gambled to make money out of money. This new crowd, in their shiny top hats, is vividly evoked in the show by Edgar Degas’s 1878 painting, Portrait à la Bourse.

“It was a moment of fundamental change in society. It was the beginning of the financial economy,” says the show’s curator, Jean-Michel Bouhours, a former chief curator at the Centre Pompidou. “Unlike agriculture or industry, it’s not a productive economy. It was really new.”

The exhibition also demonstrates how art market history keeps repeating itself. During the late 19th century, for instance, the Paris gallerist Paul Durand-Ruel made a huge bet on Impressionism, buying up hundreds of paintings by artists such as Monet, Degas and Manet. He took exactly the same kind of speculative position as Charles Saatchi did when he stockpiled works by the Young British Artists in the 1980s and 1990s. Both astutely marketed their artists as being part of a historic movement to maximise their investments.

The Warhol effect

During the 20th century, avant-garde artists spent decades earnestly trying to produce works that subverted the market. Then along came Warhol. “He was relaxed about money,” says Bouhours, who shows how he was the first artist to have some serious conceptual fun with money. By the 2000s, Damien Hirst actively embraced the financialisation and commodification of art, and the speculation that goes with it. “The concept of financial value becomes part of the work,” Bouhours says. The market for contemporary art boomed.

Bouhours says that he curated this Paris exhibition to investigate what Marx called “the mystery of value”. By the time the exhibition ends with non-fungible tokens, the culminating disembodiment of art as a commodity that has “no practical value”, the mystery seems to be solved. “The financial value is the aesthetic value,” says Bouhours, who perhaps slightly missed a trick by not including Hirst’s 2022 The Currency NFT project in his Paris show to demonstrate this equivalence.

Price being the prevailing measure of aesthetic value can work perfectly well, just as long as it continues to rise. The issue at the moment is that prices in certain sectors of the market appear to be softening. In May, Sotheby’s, Christie’s and Phillips’s marquee evening sales of Modern and contemporary art in New York grossed an overall $1.4bn, way down on the $2.5bn the equivalent sales totalled the previous May, according to the London-based auction analysts, Pi-eX.

With high interest rates, inflation and geopolitical uncertainty hanging over the global economy, sellers were unwilling to test the market with trophy works. There has always been an assumption that if sellers only had the courage to offer works without guarantees, then serious competition could be generated at these auctions. At Christie’s, the collection of the late Boston real estate developer Gerald Fineberg tested this theory with 65 lots of contemporary art by seemingly desirable names, naked of any guarantees. Estimated to raise a hammer total of $163m, these raised $153m with fees. Reserves had to be lowered to achieve sales. A multi-coloured 1993 Christopher Wool stencilled word painting topped the auction at $8.4m, far below its $15m low estimate.

As Josh Baer observed in his Baer Faxt newsletter, if a consigner keeps too much of the sales price, the auction house isn’t going to “work too much harder for not much more reward”.

This could of course be a temporary dip. But the London-based adviser Constanze Kubern says that “the secondary market will continue to face supply problems as sellers hold on to their trophies and buyers won’t spend on anything but stellar works of art”. Commenting in her own newsletter, Kubern added: “Sales will continue to be robust in the primary market.”

Money in Art explores how the opening of the Paris stock exchange in 1826 created a new professional class of bankers and speculators eager to generate wealth through art

Most of that robustness is currently being generated by intense demand for new paintings by young artists of the moment that are drip-fed onto the market through dealer exhibitions, gallery weekends and fairs. There are plenty of sociological and psychological reasons why wealthy art collectors want to buy young art of a certain kind. Take the case of the dreamy, neo-Surrealist paintings by the 31-year-old Belgian artist Ben Sledsens, represented by the Antwerp gallerist Tim Van Laere, who counts the tennis star Venus Williams among his valued clients.

“It’s about escapism, creating a utopia. Reality isn’t so bright,” said Van Laere during Antwerp Art Weekend in May. “It makes people happy.”

Back in March, at Tefaf Maastricht, Van Laere sold one of the dozen or so paintings Sledsens produces a year for €140,000. Van Laere says that he has at least 500 clients who want to buy a Sledsens. Anyone lucky enough to purchase one is also happy to know that if that same painting were re-offered at auction, those lower down the waiting list would be prepared to pay multiples of the purchase price to buy it. The market demand for these pictures, rather than the judgements of critics and curators, creates the value.

As she prepared to leave for Art Basel, the New York-based art adviser Candace Worth said that the market has around 100 to 150 coveted contemporary artists like Sledsens, with huge waiting lists. Unavailability signifies value, both financial and aesthetic. “I had one client who asked me, ‘I want a list of the top 100 artists I can’t get’,” Worth says.

Bouhours recalls noticing how, when he was working at the Centre Pompidou, over the decades museums and public exhibitions gradually lost their central role in the certification of value. “It was the market that did the validation of the work,” he says.

Is it really such a surprise that the Breuer should turn into a bourse?

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