In the middle of Christie’s “Post-war and Contemporary Art” sale last week, just as bidding for Andy Warhol’s blue photo-booth self-portrait was beginning to heat up (the work eventually sold for over $38 million, including premium), art dealer Larry Gagosian turned questioningly to Warhol collector/dealer José Mugrabi.  According to Artnet.com’s Walter Robinson, Gagosian had just bid $20 million on the piece, and been upped by $500,000.  Mugrabi shook his head,and Gagosian dropped out of the running.

 While I can’t know exactly what was going through each man’s thoughts, I do know that they are two of the top buyers at auction these days. They know what they’re doing. And in this case, they were right.

Ideally, of course, one buys a work of art for love, and not investment. Ideally, the money and the future value of the work are unimportant.

But when you’re talking 20 or 30 million, you care.  Of course you care.

Which is why buying a $30 million Warhol painting is actually a pretty foolish move. And Gagosian and Mugrabi knew it.

Sure, when a Warhol goes for that much, it increases the value of all the other Warhols you own – just as when one fails to sell at a similar price, your collection’s value will fall.  Any investor understands this, which is why, when it comes to stocks and commodities, no one puts all his pennies in the same bucket.

Yet somehow, when social prestige is at stake – and let’s face it, in certain circles, that’s what owning a Warhol self-portrait is all about – perfectly intelligent, savvy investors behave like total idiots.

In truth, as art market expert Anders Petterson told a New York audience recently, “as an investor, you’d be better off putting the money into a mid-tier category” – between $500.000 and $5 million, according to Bloomberg news.   (I would suggest “mid-tier” starts quite a bit lower, but you get the point.)