It’s turning into financial Friday here at Art Market Monitor. This is Floyd Norris in this morning’s New York Times. He’s addressing the idea that many cannot get it into their heads that the money is gone.
All those who lost a lot — and a lot is defined differently for each person — now face similar decisions. Do they admit they are permanently poorer, and adjust both their spending and their sense of how successful they have been? Or do they seek to deny reality and hope that somehow the good old days will return? [ . . . ]
And it could also be seen this week in a legislative proposal being pushed by art museum directors in New York that would bar museums in financial difficulty from selling artwork to raise money to pay other bills. Even without such a law, one museum that sold artwork is to be punished by not being allowed to borrow art from other museums.
There was outrage earlier this year when Brandeis University announced plans to close its art museum and sell the paintings. The university’s endowment was devastated by bad investments.
What do people opposed to the sale of paintings think suddenly poor institutions should do? Close? Seek government bailouts? Should Brandeis close down a few academic departments, or cut back on scholarships, to keep its art?
Brandeis is hardly the only college whose endowment has contracted sharply. I suspect that when the final numbers are in — and colleges are not exactly rushing to disclose the sad details — it will turn out that colleges as a group did far worse than the stock market while the market was doing horribly.
The Money is Gone. Now What? (The New York Times)