Nobody Expects the Art Liquidation

Bloomberg reports: Brandeis to Close Rose Art Museum as Endowment Slips

Brandeis University, anticipating a budget deficit of more than $10 million over five years, voted to close its art museum and sell a collection that includes pieces by Andy Warhol and Willem de Kooning.

The 49-year-old Rose Art Museum will close this year and seek buyers for about 6,000 pieces, Dennis Nealon, a spokesman for the Waltham, Massachusetts, school, said today. The collection was appraised at about $350 million in 2007 by the university, said Michael Rush, the museum’s director.

The private school has suffered investment losses, and spent other funds on a construction boom.

“It’s like a one-two-three punch: the economy tanks, they overbuilt at the peak of the market and their largest donor was hit dramatically by the Madoff scandal,” said Mark Williams, a Boston University senior lecturer who specializes in risk management and has studied Brandeis’s finances.

“These are extraordinary times,” Reinharz said in a letter yesterday to the Brandeis community. “We cannot control or fix the nation’s economic problems. We can only do what we have been entrusted to do -- act responsibly with the best interests of our students and their futures foremost in mind.”

Firstly, these are not "extraordinary" times. These are perfectly "ordinary" and "predictable" times. Just because, you failed to see the problem because of your instituitional bias means very little.

You gambled, you lost, you pay the price.

Secondly, education went through the same absurd "credit" cycle as everyone else. Pay gobs now, and forget about the true "total" cost. Now, you're getting whacked because you're simply not offering anything for the absurd amounts you charge. The students will not be showing up.

To be perfectly blunt, as a former academic, most education is fairly worthless. The most successful people aren't the smartest ones - it's the smartest ones who have NO debt. Even a cursory examination should be able to see the freakin' "obviousness" of this statement. (And that doesn't even count the fact that student debt is not dischargeable in bankruptcy!)

Finally, you are not going to get anywhere near the $350M appraised value in 2007. Peak prices have nothing to do with reality. You won't even be able to clear 60% of that value, if that.

Adios, losers!