Picasso's Les Femmes d'Alger (Version "O"), painted in 1955 in homage to Matisse, is expected to break the $142 million (£95.3 million) record for a painting sold at auction when it goes under the hammer. If so, it will confirm that the top end of the art market has gone completely crazy.
The week before, Sotheby's will sell Van Gogh's L'allée des Alyscamps with an estimate of $40 million, and Roy Lichtenstein's The Ring (Engagement) with an estimate of $50 million.
"The prices of so many of these artworks are disproportionate to their art historical importance," says Josh Spero, the editor of Spear's, a magazine that caters to the yachtowning, Picasso-aspiring classes. "It's all about 'my Giacometti is bigger than your Giacometti' now. Will you really get $140 million worth of pleasure from it? I doubt it. But you know you had to outbid three US hedge fund managers and a Russian oligarch to secure it."
In some ways, nothing has changed. A series of auctions in the mid-Eighties saw telephone number sums handed over for Picassos, Cézannes and Van Goghs. Back then, the bidders wore black tie and worked on behalf of Japanese banks. Now, evening dress isn't worn, and the buyers are from Dubrovnik to Dubai and beyond. But, 30 years apart, both are seeking not pictures but status symbols.
In recent years, however, as the number of global rich has increased, so too has the size of the luxury goods market – stretching both upwards and downwards. For every Les Femmes d'Alger, there are thousands of designer handbags, exquisite pieces of jade, collections of rare stamps and vintage cars. So-called alternative investments have boomed over the past five years. In this period, the FTSE All-Share index of stocks increased by 31 per cent, but according to Knight Frank, the estate agency, the value of watches has increased by 49 per cent, art by 61 per cent, diamonds by 73 per cent and vintage cars by 140 per cent.
Today, the first Conde Naste Luxury Conference – a sell-out – opens in Florence. The organisers claim that ''emerging markets with new-found spending power, are redefining what 'luxury' means''.
It is not just the large number of very rich people – especially Russians and Chinese – that has helped swell the variety of status symbols available. It has also been caused by the double whammy of wafer-thin interest rates in the US and Europe, making it impossible to earn a return on savings, and the slump in the eurozone, leaving few areas for investors to place their cash.
Last week, the Techno-Classica car show in Essen, Germany, saw hundreds of classic cars sold for eye-popping prices. Dietrich Hatlapa, the founder of the Historic Automobile Group, says: "There were so many people there you couldn't get in." Two Porsche Carrera GTs were on sale for more than £1 million each, compared to prices of £500,000 just 18 months ago, he points out, adding: "If you can indulge a passion, when you know you might even make money – that's very attractive. There's the bragging rights, too."
But the super-rich no longer just want flash cars on their driveway and a Rolex on their wrist; they want a story to tell – hence the attraction of vintage cars, which come with a history.
Antonio Achille, partner at the Boston Consulting Group and head of its luxury team, says: "What we observe is a natural evolution in the life of the consumer, moving from owning to being."
And the pleasure is increasingly derived from experiences, rather than another object, he explains: tailor-made, exclusive holidays, private jets, ranks of household staff, and the very finest dining. The increasing number of global megarich means his consultancy firm is predicting "personal luxury" (such as watches) increasing by 4 per cent a year up until 2020, while "experiential luxury" will increase by 7.5 per cent.
NetJets, a supplier of private jets, says it flew 80,000 passengers last year, and 2,000 pets. In fact, on 65 flights last year the pets outnumbered the humans. Most of the passengers book a private jet to save time. At London's City airport, they are promised that they will board within nine minutes of arriving at the airport.
NetJet members (it operates a bit like a club) also have access to various exclusive experiences. "In the past these have included everything from playing tennis with Andy Murray through to VIP previews at Art Basel Miami," a spokesman says.
This is the model an increasing number of luxury goods brands are adopting. "The millennial generation are much more into pleasure, they are also much more into sharing. For them experiencing, is more important than owning," says Achille.
One of the ultimate experiences is an exclusive holiday – and we're not talking about a private tour of the Sistine Chapel (anyone can book that for about £300 a head). No, at the very top end, the exclusive travel company Based on a True Story, "works in the realms of pure reality," according to its founder Niel Fox. One 10-day holiday cost more than £2 million for six adults and four children.
It involved creating an entire fictional world for the youngsters to discover when they dived off their superyacht. Swim to a private beach, and they would discover actors dressed up as characters from ancient Greek myths, encouraging them to find hidden gold. On another day they'd come across a fire-breathing dragon on Mount Olympus (which, of course, had been closed to other visitors). You don't get that sort of experience at Center Parcs.
This quest for unique experiences has filtered down well below the oligarch classes. Sarah Collinson, innovation manager at John Lewis, says: "We're seeing people buying less into status symbols and more into experiences. Luxury is about treating yourself, maybe a midweek beauty treatment or taking time off."
How does the doughty old department store take advantage of this trend? By offering an increasing number of bespoke perfumes, very high end linens and £100 pillows.
François-Henri Pinault and his wife Salma Hayek
The quest for unique experiences can plague even those who can afford to buy a Picasso. After all, the artist painted 15 versions of Les Femmes d'Alger. How can you be sure yours stands out? Simple: open your own private museum. One notable example is the Museum of Old and New Art in Tasmania, which displays the collection of David Walsh, a professional gambler. Meanwhile, François Pinault, the French billionaire, and his son François-Henri (aka Mr Salma Hayek) have two in Venice: the Palazzo Grassi on the Grand Canal and the Punta della Dogana.
Celine Fressart, head of special projects at 1858 Ltd, an art advisory business, says: "Making your collection available to the public, understanding the journey you have been on, your taste. That, really, is the ultimate in bragging rights."
By Harry Wallop