NYC Fall Art Auctions Open against Gloomy Backdrop

Christie's and Sotheby's kick off their annual art auctions in New York City this week against the backdrop of a gloomy economy that has some wondering whether there are any deep-pocketed buyers left to snap up paintings for tens of millions of dollars.

Some of the most famous artwork of the past century is being put up for sale, including Edgar Degas' "Dancer in Repose," priced at $40 million, and Kazimir Malevich's "Suprematist Composition," for $60 million.

Among those who reportedly are selling pieces from their art collections are Kathy Fuld, the wife of Richard Fuld Jr., the former CEO of Lehman Brothers who has been vilified for his company's role in the financial meltdown.

The high-end art market has stumbled in recent months as hedge fund traders, financiers and Russian, European and Middle Eastern buyers who helped prop up the art market in recent years fell victims to the global economic crisis.

Sagging prices at last month's London auctions suggested that the meltdown has finally ended the art-market boom that has seen a series of price records get shattered over the last few years. Christie's and Sotheby's contemporary arts sales generated at least a third less money than predicted, and many were unsold.

The New York sales are considered an important test of how price levels have changed since the summer, and how buyers will respond to the top-selling works, said Ian Peck, CEO of the art-finance firm Art Capital Group.

The last such sales, in May, generated more than $500 million between the two houses.

An indication of the softening market came last week, when Sotheby's withdrew Pablo Picasso's "Arlequin," one of the star lots at its Monday sale, "for private reasons."

The move was "a sign that auction houses and buyers fear the risk of a downturn in prices is too great to ignore," Peck said.