Sarah Thornton’s Economist.com analysis of the Contemporary art market focuses on the dynamic of the Jeff Koons market. After all, the signal lot in the sales was Sotheby’s Baroque Egg which, depending on which commentator you read, did well or fared poorly. Thornton explains why Koons is so important:

The Jeff Koons trade—both public and private—offers an interesting case study of the dynamics of the market today. [ . . .]

Of the Celebration sculptures, “Balloon Dog” is the most coveted. It could be because it’s the most aesthetically successful or it might be due to the consensus of five collectors with the muscle to validate art. François Pinault, a luxury goods billionaire with a museum in Venice, owns the work in magenta; Dakis Joannou, a construction tycoon with a foundation in Athens, possesses the red; Peter Brant, a newsprint magnate, has his orange version installed on the lawn outside his study centre in Greenwich, CT; Eli Broad, a Los Angeles property developer, displayed the blue one at the Los Angeles County Museum of Art last year; while Steve Cohen, a hedge-fund manager, loaned the yellow for an exhibition on the roof of the Metropolitan Museum of Art in New York.

At the moment, it would appear that prices of pieces from the artist’s earlier “Luxury and Degradation” series are holding up well. Thomas H. Lee, a private-equity investor, is said to have recently sold “Jim Beam J.B. Turner Train.” Mr Lee bought the stainless-steel sculpture at Christie’s in May 2004 for $5.5m. The Koons is believed to be part of a package deal brokered by Giraud Pissarro Segalot, who declined to comment. Mr Lee is said to have sold the train for substantially more than he paid. Speculation suggests that the sum was in excess of $15m.

Crossing to Safety (Economist.com)