The German art market could use a little good news. The Rhineland is rich, but many U.S. art buyers are staying home, thanks to the global economic slowdown and the threat of war with Iraq. What's more, collector confidence in Germany is being battered with threats of new taxes from the government of Gerhard Schroeder -- a hike in the sales tax on art from seven to 16 percent, and perhaps even a new "resale royalty" tax on profitable sales by collectors and dealers of works by perhaps 300 top artists.

Inside the airy Rhineside exhibition halls at Art Cologne, it may feel like the seven fat years have come to an end, but art dealers still make sales. At the vernissage, the Amsterdam dealer Nico Delaive sold two works by Yves Klein -- over the phone. "He wasn't here, but he was afraid someone else would get them!" said the irrepressible Delaive.

Also marked with red dots were two acquarelles by Sam Francis. "I've bought maybe 1,000 works by Sam and sold 500," Delaive said. "The estate has nothing left in it!" And along one wall of his booth are recent gouaches Delaive coaxed from the studio of the legendary 1960s visionary Constant, who is now 82. Constant doesn't like to sell works, he wants what's left to go to a namesake museum after he dies. An ominous blue and gold portrait of Medea clutching her two children is $26,000.

Art Cologne is bewilderingly large, with 258 exhibitors from 22 countries spread out on two mazelike floors of the H-shaped hall. The free map is essential, even with its minuscule type. The ceiling is invisibly high and the booths are quite spacious, larger than those of New York's Armory Show or Art Chicago (a small booth is $15,000).

Art Cologne is Germany's most important contemporary and modern art fair, and over half -- 145 galleries -- are German ones. The broad aisle down the center of the second floor -- Art Cologne's Champs Elysses -- is a lineup of power hitters: Karsten Greve with an estimable assortment of sculptures by Louise Bourgeois; Michael Werner with an imposing primordial scene in bronze by A.R. Penck from 1987; Gisela Capitain with witty, subtle sculptures by Georg Herold and Jorge Pardo; Galerie Gmurzynska with a choice concentration of works by women artists of the Russian avant-garde; Galerie Thomas with paintings by Picasso, Karl Hofer, Alexej Jawlensky.

Rafael Jablonka snared something of a coup for his booth -- Eric Fischl's Tumbling Woman, the World Trade Center memorial that was so ignominiously removed from display at Rockefeller Center this August. Jablonka has the dramatic bronze, whose surface has a pronounced tactile shine, displayed up on a concrete block. It can be yours for $300,000.

Another especially good-looking booth is Galerie Christian Nagel from Köln. Nagel is showcasing some classic contemporary works by the 43-year-old Austrian artist Heimo Zobering, a group of a dozen small sculptures from 1981-85 in which the artist was exploring the possibilities of abstract sculpture after Minimalism. The small maquette-like objects (€5,000) look like heavy industrial fabrications but are in fact handmade of cardboard. They came straight from the artist's studio in Vienna. On the booth's long back wall is a double row of target paintings from 1964-72 (€11,500) by the late Danish artist Poul Gernes (1925-96). These works were recently showcased by the hot young painter Cosima von Bonin, who included them in her own recent exhibition at the Hamburg Kunstverein.

Needless to say, art fairs are filled with new works by top artists. A large brightly hued abstract photo by Thomas Ruff stands out in the booth of Galerie Wilma Tolksdorf from Frankfurt. The unrecognizable image is derived from comics downloaded from the Internet and overlaid repeatedly until all reference is lost in a melting kaleidoscopic pattern. The photo is priced at €36,000 in an edition of three. At Mai 36 Galerie from Zurich one could see several new gouaches by the American artist Matt Mullican. Though best known for devising his own elaborate sign system, Mullican now is working with images of molecular patterns.

It's always good to mix in younger artists with the senior blue chips. At Monika Sprüth/Philomene Magers, the booth is furnished with the utilitarian sculptures of Stefan Kern, whose works double as furniture. The young Hamburg artist studied with Per Kirkeby and Ulrich Ruckreim, and had a solo show earlier this year at the Hamburg Kunstverein and also exhibited at the new Sprüth/Magers project space in Munich. In addition to benches and tables, Kern makes seesaws and tree houses. The work shown here, Untitled (Wave) (2002) is €15,000 in wood and €40,000 in aluminum.

Cologne dealer Aurel Schreibler juxtaposed classic works by Oyvind Fahlström and E.W. Nay with new pieces by Boy & Erik Stappaerts, Joe Zucker and Peter Strauss. Stappaerts, who is one person with two first names, makes sleek color environments that include futuristic objects like a coffee-table-sized, hard plastic lozenge shape in shiny bright red. Zucker's attractive new works, which are finding considerable collector interest, are made by pouring pure paint into shallow cardboard boxes and displaying the results like landscapes. And Strauss, who was born in 1966, makes large figure compositions in bright colors and swirling shapes that channel graffiti and cartooning through an expressionist delirium.

Jonathan Meese, another favorite of the German contemporary art scene, brings his signature pandemonium to his "room evolution," or installation, at the booth of Galerie Ascan Crone from Hamburg. Against a black-painted wall, Meese arrays an energetic if raggedy collection of mannequins made of plastic bags and scrap metal in front of "formal" portraits of Mater and Vater (€50,000 each).

As always, idealist color abstraction has a very strong following. Beautiful hues reign at Galerie Rupert Walser from Munich, for instance, where a huge multicolored painting by Jerry Zeniuk titled Altar Painting (2002) (€60,000) holds sway next to a small vibrating monochrome by Marcia Hafif called Alizarin Madder Lake Ultramarine (Green Shade) (2002) (€11,000). The contemporary German abstractionist Martin Nöel, whose new works are painted on panel with some areas cut out of the surface, can be found at four booths at the fair, including Galerie Benden & Klimczak from Aix and Marseille (€2,000 for a small work).

Also on the central aisle are two veteran British dealers: Nicholas Logsdail's Lisson Gallery with Jason Martin squeegee paintings and Richard Deacon glazed ceramic sculpture, and Annely Juda Fine Art with severe Minimalist displays of works by Carl Andre, Robert Mangold, Robert Ryman and others. Although the foreign contingent includes 15 U.S. galleries, most of these entries are younger and located on the ground floor.

Surrounding the central core of contemporary dealers is another group of galleries specializing in 20th-century European masters, with a strong concentration of German works. At the Swiss gallery Henze & Ketterer is a museum-quality 1940 portrait of a young girl in the mountains by Otto Dix, a painting that would fit right in with a trio of similar ones on view at the nearby Wallraf-Richartz Museum. At Galerie Ludorff from Düsseldorf are watercolors by Emil Nolde, Oscar Kokoschka and Herman Hesse and a 1902 oil sketch of two riders by Max Liebermann. A collector could assemble a provocative group of naturist nudes by starting with a 1910 Christian Rohlfs drawing of a Madchenakt at Galerie Remmert und Barth (€24,000) and a ca. 1923 acquarelle of a Liegender Akt at Salis & Vertes from Salzburg (€80,000).

Eight galleries at Art Cologne are offering works by the German Post-War painter Ernst Wilhelm Nay (1902-68), who is currently the subject of a retrospective at the Munich Pinacothek. Nay revitalized German art after the war -- he was paired with Pollock at the first Documenta -- until he was knocked from center stage by the arrival in Germany of Pop Art in 1964. His musical color-disc abstractions from the 1950s are of particular interest.

Livening things up on the ground floor are Art Cologne's three special sections -- 16 open booths dedicated to large-scale sculpture, 20 half-sized booths given over to newer, smaller galleries, and 20 more half-sized booths dedicated to installations by individual artists.

In Köln Sculpture, as the section of extra-large spaces is called, the German artist Katarina Sieverding, has filled her booth with square kiosks whose mirrored sides alternate with large-scale black-and-white photographic images of a human skull or Sieverding's own formidable visage. The French artist Sylvie Fleury has lined the walls of her area with large light-blue neon letters that read "shield hydrate revive purify expoliate. . . ." Leiko Ikemura, who shows in Köln at Greve, has filled her space with a forest of her rough-hewn, glazed terracotta figures that bow and turn with primitive grace (€15,000-€17,000).

On hand in the sculpture section from New York (where he exhibits with Brent Sikkema) is artist James Hyde. Among the eight works in his installation are a huge painted pillow and an oversized strip of striped fabric that swoops and hangs like a big brushstroke. "It's my way of making concrete abstract painting abstract again," he said. In a few weeks, Hyde is slated to open an exhibition of an even larger painted pillow at the Credac art center in Ivry, outside Paris. Titled The Cosmic Pillow, it's large enough for viewers to walk into -- like "entering the womb of four-breasted structure," the artist said.

Similar large-scale avant-garde gestures can be found in the sponsored artist's spaces. Christoph Steinmeyer, for instance, has fitted his space with a skull-shaped disco ball that throws its fleeting reflections onto six smallish portrait paintings of notably arrogant women, which carry titles like Morgana and Walkurie. Steinmeyer, a Düsseldorf artist who was born in 1967, exhibits with Cologne dealer Michael Janssen.

It's not unusual, of course, for avant-garde artists to make avant-garde gestures especially for the fair. At Galerie Bob Gysin from Zurich is a kind of freestanding chamber made of mattresses (€8,000) by Bob Gramsma, a 39-year-old artist who is currently in New York in the P.S. 1 residency program. It has a refrigerator door, so its "both cold and warm," said gallery director Beatrice Steiner. Gramsma likes to make new environments. For his forthcoming show at the Kunstverein Ulm, "he's doing incredible stuff we guess with an airplane," Steiner said.

There's more, of course. Thomas Rentmeister plastered together 20 compact refrigerators into a single, massive Minimalist unit called Whiteware (2002) (€28,000) for the booth of Otto Schweins from Cologne. And at Galleria Astuni from Pietrasanta, Italy, Antonia Riello came up with a huge Bomba (2002) on wheels, made of ceramic painted with Renaissance patterns. It is €25,000, though a decorated ceramic hand grenade can be had for €1,500.

Such plays on artistic tradition are easy to find at Art Cologne. Galerie Fons Welters from Amsterdam has several large untitled acrylic canvases by Sven Kroner that show skiers jetting down a steep Alpine slope -- of expressionistic white and blue paint. "We did quite well with these at the Basel art fair," said Welters. A good-sized canvas is €6,500. Also in the Welter's booth is Tom Claasen's Wooden Man (2002), a simple prone figure made of chainsaw-cut logs bolted together (€5,000). The 37-year-old artist has an installation of tree-sized figures at the Kroller-Muller Museum near Arnheim.

Some of Cologne's cutting edge galleries are also on hand. Among the so-called "young galleries," who were invited to the fair and paid half price for a small stand, or €7,500, is Borgmann Nathusius, run by the irrepressible Nina Borgmann and Caroline Nathusius. Their booth is showcasing photo-and-drawing montages by Amelie von Wulffen, a 30-something Berliner who begins with snapshots and elaborates on them to create glimpses of a utopian -- or apocalyptic -- new world (€1,800-€2,700). Von Wulffen won Germany's Ars Viva Prize for 2002, and is slated to exhibit in New York at Greene Naftali.

Among the Americans at the fair, no one looks better than Greene Naftali, where dealer Carol Greene has installed a styrofoam assemblage by Rachel Harrison that has perfect-pitch devastation cool and a bulletin board of snapshots of a romping dog by Tom Burr that manages to be both conceptual and Dionysian.

Another New York dealer at the fair, Leo Koenig (who despite his youth was placed on the upstairs floor), is displaying a stunning little sculpture by Tony Matelli. Couple (2000), which is made of PVC plastic, shows a gaunt and tiny African couple -- obviously based on a UNESCO fundraising appeal -- holding hands. It's a harrowing image of love in the age of starvation. Among the visitors to Koenig's booth was artist Peter Saul, in town for his show of new paintings at Aurel Schiebler. What's your secret? "Keep vengeful and completely immature," he said.

One final image from the fair seems especially appropriate -- a lifesize figure by Jan Fabre in a special, altar-like chamber in the back of the booth of Galeria Academia Mario Mauroner Contemporary Art from Salzburg. Titled Ascendens (1979-2000), the piece shows a male figure with his head thrown back, wearing a trench coat and ascending, presumably to heaven, despite being completely covered with a layer of golden brass thumbtacks, point-side out (€68,400). For Art Cologne, an especially prickly apotheosis.