Boom | Michael Shnayerson

Summary of: Boom: Mad Money, Mega Dealers, and the Rise of Contemporary Art
By: Michael Shnayerson

Introduction

Embark on a fascinating journey unveiling the contemporary art world in this summary of Michael Shnayerson’s book, ‘Boom: Mad Money, Mega Dealers, and the Rise of Contemporary Art.’ Witness the evolution of the art market into a $63 billion global powerhouse and observe how galleries, dealers, and artists have reshaped it over the years. Discover the instrumental figures like Leo Castelli, Larry Gagosian, and Paula Cooper, whose bold decisions left an indelible impact on the art scene. Track significant developments in the major auction houses and the birth of mega galleries, as this summary unfolds the enthralling tale of contemporary art, culture, and commerce in an easy-to-understand language.

The Evolution of the Art Market

The art market has grown into a global industry worth $63 billion, transforming from a small community of collectors to a social hub for the elite. The efforts of influential dealers like Leo Castelli and Betty Parsons, who established galleries in New York City, played a significant role in this transformation. Castelli’s business decisions, such as building satellite relationships with other galleries, helped create a cooperative environment in which art can be shared and sold across different markets. Paula Cooper was the first female dealer to establish a gallery in SoHo and supported minimalist and conceptual artists. Larry Gagosian, who learned from Castelli, became the most important figure in the contemporary art market. The 1980s brought fierce competition among mega galleries, such as David Zwirner, Iwan Wirth, and Marian Goodman. The 1990s brought influential dealers like Gavin Brown and Mary Boone. These gallery owners represent internationally respected artists and continue to shape the contemporary art scene.

The Evolution of Art Auctions

In 1973, the Robert Scull art auction set the precedent for auction houses to become the new metric for value in the art world. Francois Pinault’s purchase of Christie’s in 1998 encouraged private sales and shot impressionist and modernist artworks’ prices to new heights. The contemporary market grew, and purchasing art became a symbol of wealth. Dealers’ sales remained private, but auctions provided a public forum for collectors seeking attention. In the late 1980s, a new breed of dealers described the market as “frothy.” Auction houses were known to sell only secondary-market artworks; their business model didn’t create artists’ careers, which remained the gallery’s job. The early 2000s saw a change, and auction houses began building artists’ careers, generating high commissions through private sales. Damien Hirst auctioned his own works at Sotheby’s in 2008, defying the art market, and generating $200.7 million in sales. However, his prices did not regain the heights of 2003-2005, and despite an endless supply of new artists’ artworks, buyers favored the hot and trendy.

The Emergence of New Art Scenes

As SoHo became increasingly popular and expensive, New York City’s East Village evolved into a new art scene. Real estate became a key factor in the growth of galleries. Lisa Spellman’s Chelsea gallery received a buyout offer that led to her owning two full floors in a new building, increasing her gallery space. Gagosian was the first to expand globally with a gallery in London that catered to new Russian immigrants. Hauser & Wirth opened a Los Angeles gallery with Art + Practice. Sotheby’s and Christie’s opened auction houses in China, leading to the inclusion of Chinese artists represented by Glimcher, Pace Gallery, and Gagosian. In 2012, the US held 46% of the art market, China 21%, and London 20%. These galleries and auction houses, coupled with the influence of collectors like Thea Westreich, Herb and Lenore Schorr, Elaine Dannheisser, and Don and Mera Rubell, created a thriving global art market.

Art as Investment

Following the 1987 stock market crash, art became a reliable asset for high-net-worth clients. Banks provided loans against brand-name art, earning fees and building relationships with collectors. Art advisers emerged, guiding clients on which artist’s work to buy, how to manage their collections and where to invest. However, after the 2008 financial crisis, many advisers disappeared. Jeffrey Deitch recognized the need for new analytic models for a contemporary market pivoting to art as an investment vehicle and built an art advisory department for Citibank based on his “art economics” thesis. Despite outrage that a dealer should hold such a position of power, he headed a public museum. For wealthy clients, higher prices led to more valuable works.

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