This week was a complete disaster for Sotheby's

It has been a disastrous week for Sotheby's.

The stock has crashed 14% over the past five days, and the stock is now down 54% in 12 months.

The latest dive started Thursday when the stock fell 17%, following dismal sales numbers out of London.

Earlier in the week Sotheby's Contemporary Evening Sale hauled in 44% less cash than it did a year before, prompting The Wall Street Journal to write that the art market is officially "in a correction."

The writing's been on the wall for a while. Back in November, Sotheby's CEO Tad Smith said that his customers had gotten more "discerning." Art buyers like billionaire hedge fund manager Ken Griffin noted that while high profile sales from first-tier artists were still being made, sales for second-tier artists were trending down.

In other words, the super, super rich were still buying, but the just super rich were not.

And why would they buy right now? Global markets are in utter chaos.

The whale

Another issue factoring into this mess is the controversy surrounding Malaysian financier Low Taek Jho. Once a feature on the global jet set, Jho is now under scrutiny in his home country.

And he's selling all of his incredibly expensive art. It's messing up supply dynamics in the market. Katya Kazakina covered the disaster for Bloomberg [emphasis ours]:

Low is once again creating buzz in the art world. Since Feb. 3, he has sold works by Claude Monet, Pablo Picasso and Jean-Michel Basquiat, according to three people familiar with the matter. They fetched about $54 million, with unusually steep losses on at least two pieces.

The artworks consigned by Low were among the top lots at Sotheby's evening auction of Impressionist, modern and contemporary art in London this month. All three had been pledged as part of the collateral for a loan of about $100 million from Sotheby's Financial Services, two of the people said, asking not to be named because the information is private.

This lending bit is important, because over the last year Sotheby's has built up the lending part of its business significantly.

So now is really not the time to have big buyers putting on fire sales.