And yet it wasn’t enough. Not enough, that is, to pay off the creditors who began rushing to court this fall to file suits, sensing that this creditee had limited funds to pay all he owed. Although the full story is still emerging, what has come to light so far is already devastating—a slew of allegations insinuating that the dealer had essentially created a Ponzi scheme and sold artworks he didn’t have the right to sell, resulting in the closure of Salander-O’Reilly and seizure of its assets and Salander’s declaration of personal bankruptcy.

It’s a salacious story fit for a novel (Tom Wolfe, this one’s on us), and the fallout will likely take years to fully make itself known. But one can’t help but wonder how unusual Salander’s business practices—he’s essentially been accused of shifting money from one client’s account to another’s, hoping at some point he would come upon a big enough sale to make the whole thing add up—actually are. And that’s why, though Salander is the only one alleged to have committed a crime, many gallerists may soon be paying the price. It’s a safe bet that the art market is about to get some strict new regulations.

5. Subprime Surprise
Around midsummer, the art world learned a new word: subprime. A crisis in home mortgages threatened to destabilize the booming financial markets, and the word subprime itself, with its ominous prefix, suggested by inversion the very thought on everyone’s mind: that the art market was overvalued. Suddenly pundits became pessimists. A correction, long overdue, would be short in arrival, they said, and the November auctions were supposed to be the site of the bloodbath.

And then something funny happened: nothing. The two weeks of auctions brought in the same robust, record-breaking numbers we’ve come to associate with the art world of late (even if no single work equaled Rothko and Warhol’s May results); the one disappointment was the exception that proved the rule. Success went well beyond contemporary to other areas of the market. The bulls kept running in Miami. And so the party stretches on … at least until 2008.