The art world has officially forgotten the recession.
Last night, Sotheby's set a new record with a total of $375 million in total sales during its contemporary art sale.
The tally shattered the old sales record of $362 million set in May of 2008, before the financial world collapsed.
Leading the sale was Mark Rothko's "No.1 (Royal Red and Blue), which sold for $75.1 million — far surpassing its top estimate of $50 million. Other big-ticket sellers included a Jackson Pollack for $40.4 million, a Francis Bacon for $29.7 million and a Warhol for $15.2 million.
Art advisers and dealers said the prices were driven in part by American collectors — as well as overseas buyers — who are rediscovering the masters of Abstract Expressionism. Many of the top abstract expressionists took a backseat in the market in recent years as more trendy artists like Jeff Koons and Damien Hirst soared in value.
Last night featured some of the best examples of artists that are now coming back into vogue, they said. Christie's contemporary sale, which also features works by some of the top abstract expressionists, may also set new records tonight.
"The market is responding to quality," Brett Gorvy, head of Post-War and Contemporary Art at Christie's told CNBC. "There has been a shift in taste. We are now seeing a global market responding very much to the contemporary, toward produced 1945 to the present day."
The market, however, was also powered by overseas buyers who are racing to get their money offshore and park it in safe havens. With many countries facing political uncertainty and rising taxes on the wealthy, the global rich are increasing turning to art, real estate, diamonds and other hard assets that they can quickly move out of the reach of government.
Sotheby's said it had bidders from every major continent except Australia.
"There is of course a financial aspect and a safe haven aspect of blue chip art as an asset class," said Alex Rotter of Sotheby's. He added that "market history has shown that if you buy an A-plus work by an A-plus artist, even if you pay an A-plus price, it will still be A-plus if you ever bring it back to market."
Art, say dealers, has become a highly efficient and portable way to protect tens of millions of dollars.
"Art is certainly a hard asset that you don't have to declare and can move freely," Asher Adelman, of Edelman Arts, the gallery and art consultancy. Edleman said. "All those things make it a safe haven."
Still, he said, there is little guarantee that the prices paid today for many works will hold up over time. What some may see as today's "safe haven" might be seen later as a price bubble.
"Remember tulips?" Edelman says. "It's the madness of crowds. If you chase the popular it's pretty unlikely you will have great success with those prices in the long term. When you buy into a craze it might be a long time before you get your money back."