In the rest of the world, market prices for art generally follow stock market fluctuations, but in Japan this rule went by the wayside, with art fever being fueled by the inflation-induced buildup of wealth in real estate. Japanese players applied the same theories to the art market as they did to real estate speculation, putting faith in the simple reasoning that the more limited the supply, the higher the price. According to this logic, the finite supply of paintings would cause prices to catapult . Japanese companies made their purchases with little regard for quality or price, becoming a dominant presence at auctions in New York, London, and Paris. The opaque nature of the painting transactions lured numerous corporations in need of a quick repository for paper wealth.
Japan has no public auction market and no public forum for establishing art prices.
The difficulty of having works of art valued objectively was heavily exploited by companies, and proved a convenient medium for evading the scrutiny of tax and financial authorities. Many companies took advantage of the ambiguous value of art for borrowing, lending, concealment of assets, money laundering, bribery, and tax evasion. The paintings were even used for raising funds for political donations and contributions. The art dealer would then issue a fictitious sales slip, leaving no trace of any shady financial transaction. A spate of financial scandals using artwork surfaced after the collapse of the economic bubble, involving the now defunct Itoman, a medium-sized trading house, and Mitsubishi Corp., one of the largest trading houses.