Many readers have picked up on Jeffrey Deitch’s comments about Francois Pinault’s recent art purchases during the “After the Deluge” panel at the X-Initiative last month.

So many have commented, in fact, that Deitch got in touch with us to clarify his remarks.

First, Pinault did not cancel a purchase from Deitch. Though Deitch is aware of other canceled deals (and ArtMarketMonitor.com has heard corroborating stories), it is important to emphasize that Pinault did not cancel all of his purchases.

More to the point, Deitch’s comments were meant to reassure the audience–which was composed of a number of young artists–that there were frustrations at all levels of the market.

We failed to run all of Deitch’s comments from the panel. That was our mistake. So we’re including them below.

You’ll see that the rest of his remarks concern what the art market has to do as a community to weather the financial storm.

Do you have a business model for how you run Deitch Projects and can that model sustain this downturn?
We try to run the gallery as much as a private ICA as possible without having to really think about business. We had a very good run during the past few years. We were able to make all our programming decisions on a non-commercial basis, and it’s a wonderful luxury and we’re very thankful we were able to do that.

Are those days over?
An economic downturn, that’s part of the world. If you want to sustain a business, you have to be able to last through the downturn as well as take advantage of the boon times.

Are you changing your strategy to focus more on your primary or secondary market sales?
The strategy now is not to face reality, because we get a lot of rewards from doing projects that don’t have a commercial return, and I can’t face cutting them at this point.

What if one of your artist comes and says, “I want a million dollars to build this gigantic thing.”
That’s the one specific thing, no more super-expensive applications. Last year, British artists who are friends of mine wanted to create their dream project, the electric fountain, which was presented in Rockefeller Center. It was very, very successful with the public. It cost a million and a half dollars, and there was no one else to pay for it except me.

Do you have any chance of recouping that money?
I’ll have to wait until the market recovers. The real estate projects are in bigger trouble than the galleries are. That’s something you have to realize for a while. I can now say, “Sorry, that’s over.” That was always the biggest strain on resources.

How will the downturn impact your exhibitions and who you will represent? Will you scale back? Is capital harder to get a hold of?
So far, we haven’t altered the plans. Like I said, we’re improvising. Something is essential about what we all do in art – art is inherently an optimistic endeavor. We’re optimistic, and I want to keep a sense of embracing the future and not to descend into a kind of gloom.

Is it possible to stay on a budget?
We have to. We’re going to try every possible means of trying to keep the whole thing going, and hopefully we’ll only have to strain for a year or two. Nobody knows, it could be longer. In that case, we can’t. But I’m trying to keep the ambition up and keep the program very active.

How is art going to be impacted, how is art-making going to change to reflect the times?
Something that we have in the art community, even with the downturn, is our community. It’s an absolutely remarkable community. There’s nothing like it, it’s international, it’s increasingly diverse, and I think that we’re going to look more and more at our community as an amazing asset. Something that does happen during economic downturns is that the community becomes stronger. Reading about what happened in the 1930s, it was not a great time for art innovation, but the 1930s, because of the WPA projects, that’s how a lot of the artists met each other in New York. The whole New York school would have never really come together without these connections made with the WPA. In the Seventies and early Eighties, when I got my start in the field, there were wonderful models, like the Times Square show of 1980 where the uptown community from the South Bronx and the downtown community came together at a massage parlor a block south of 42nd Street and did the greatest show of that time, and a lot of artists met each other, they connected through that show. What I think’s going to happen is the opportunity for shows in this model, where artists who otherwise don’t have the structure to connect are going to meet, and be the foundation for a whole new community, the same way the Times Square show was a foundation for the dynamic New York art community of the 1980s.

Shouldn’t the city or non-profits help with doing shows in empty retail spaces?
A collector friend of mine who lives in Beirut came to New York and walked through SoHo and was shocked with all the empty storefronts. “Doesn’t the city do something about this, this brings the whole area down. You have to do something.” An initiative I’d like to put out here, I’d like to try to get together and figure out a way to turn every empty storefront in the art neighborhoods into art galleries, art installations, something that could be done…we could do something amazing in the neighborhood where this is concentrated.