Abby Schultz’s article on Penta gives a quick overview of the sort of leveraging that has been going on in the art world, and whose been loaning the billions of dollars. It is not only the banks and specialty firms, but even the auction rooms are in on the action. So, the auction rooms help fund client’s purchases? Gives you a slightly better understanding as to how certain collectors can pay those crazy prices.
With the current pandemic, it will be interesting to see how many of those ‘leveraged works’ end up back on the market at discounted prices. I have already heard about people offering pieces they recently purchased at discounts of up to 50%!