One of the confusing aspects of the “new normal” in all asset classes is trying to make comparisons to previous valuations. Viewed from the height of the credit bubble, all assets seem weak. For example, here’s the way Carol Vogel characterizes the recent cycle of auctions in New York:

While prices for the best works seemed high and bidding was often deep, the volume of sales — nearly $600 million between the two companies — was vastly diminished from a year ago, when Sotheby’s and Christie’s sold a combined $729 million or two years ago when the market peaked at $1.6 billion.

Shortly after making that point, however, she adduces evidence that current valuations on art are quite strong relative to the “new normal” but also toward absolute values. Here’s what the two auction houses say about the star Warhol lot, 200 One Dollar Bills:

Would what proved to be the star of the last two weeks have made more at the peak of the market? No, said both Mr. Meyer and Mr. Porter. Mr. Meyer pointed out that during the boom, big money went for highly colorful images like a 1976 triptych by Francis Bacon ($86.3 million in May 2008) and a Rothko canvas, the 1950 “White Center (Yellow, Pink and Lavender on Rose),” from the collection of the retired banker David Rockefeller ($72.8 million in 2007).

“Because this Warhol is black and white, it could have very well been overlooked at the height of the market,” Mr. Meyer said. “Although it is art-historically important, it takes a little knowledge to appreciate.”

Art Prices (and Mood) Pick Back Up