We have seen the photos of phantom towns of midrise apartment buildings and sprawling neighborhoods, lavishly laid out with broad avenues and huge shopping centers where the only and apparently inconsequential element that was missing was human life, like macabre scenes from a badly staged post-neutron-bomb apocalyptic movie. And we raised our eyebrows at the mini-revolts taking place in front of real-estate sales offices when new apartments sell for 30% less than the price at which these hapless people had bought similar apartments a few weeks or months earlier. And we marveled at the booming luxury car sales over the last few years that turned Audi, Porsche, BMW, and Mercedes-Benz into immensely successful brands in China, where people paid $20,000 or more on top of the sticker price to move up on the waiting list, though the premiums have given way to record-breaking discounts and free gifts. And then—it’s been so long it’s hard to remember—there was the blistering Chinese stock market that blew up with the Beijing Olympics. It’s down almost 60%. Yet, undeterred, buildings continue to shoot into the sky, whether or not anybody is going to use them or live in them or shop in them.

But Chinese investors have discovered another place to plow their itchy money into, and this time it’s something actually … enjoyable: art and antiques.

And with the zeal that only frenzied speculators can muster, they’ve whipped the Chinese art market into a froth, with bubble-licious growth rates of 177% in 2010 and 64% in 2011—to capture 30% of the $60.4 billion global art and antiques market, as measured by dealer and auction sales. Modern China simply doesn’t do anything gradually. And so the country has become, in one fell swoop, the largest art market in the world.

Laurels that the US had been resting on through 2010—when it still had a share of 34% that, in just one year, shriveled to 29%, according to a report commissioned by TEFAF Maastricht. Third in line was the UK with a share of 22%. France was in fourth place with 6%. If the 27-nation European Union were considered one market—with umpteen languages and 14 currencies—it would be in first place with 34%, to be dethroned, possibly, by China even as we speak … unless, of course, Chinese art speculators begin cashing in their chips, in which case all bets are off.

Turns out, art is a volatile business. Its violent swings depend on the economic mood, on investor fear or frenzy, and on how much money central banks are handing out. It is sensitive to collectors, as they’re euphemistically called, having to dump their collection on the market due to margin calls—before the Fed steps in to bail them out. The worldwide art market peaked in 2007 at $63.4 billion, but then the financial crisis brought it to its knees. It bottomed out at $38 billion in 2009, only to jump dot-com like by 63% over two years to $60.4 billion. So, despite China’s voracious appetite, the market still lags its pre-crisis peak. But it has come a long way since 1991 when it was a measly $10.5 billion.

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