Every time the world economy crashes, auction houses dust off their talking points about fiscal responsibility and the wrong-headedness of their older, freer-spending policies. Then, every time we experience a sustained recovery—at least, at the apex of the economic pyramid—they go right back to approving big guarantees, especially now that it’s become de rigeur to offload some of the risk to third parties.Or take from The Art Newspaper that assumes the success of the Leonardo inevitably leads to more guarantees:
why would vendors not accept a guarantee, particularly in the light of the very public failure at Christie’s London in October, just a month before the Leonardo sale, of Francis Bacon’s Study of Red Pope 1962. 2nd Version 1971, (1971), which “went naked” sans guarantee and was estimated at an over-optimistic £60m-£80m?So let's try to answer that question and then talk about what guarantees are, how they are used by the auction houses and how the use of guarantees has changed over the last decade.
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