Brandeis University is selling its $350 million art collection. One interesting thing about this is that there exists a bad law saying that universities can't spend the principal of their endowments. Cushioning bad times should be a major (maybe the only) reason for endowments. Precautionary saving is an excellent idea; merely piling up golden ducats is not.

Brandeis's endowment had plunged to $540 million at the end of 2008 from $712 million as of June 30 of that year, and it was earning significantly less than the 8%-plus annual return on investment it had posted on June 30. Some of Brandeis's trustees are believed to have lost money from Bernard Madoff's Ponzi scheme, limiting their ability to make up the difference. The school, which by law spends only its gains and not the principal of the endowment, reduced expenditures by $10 million and instituted various budget-freezing measures, but "we couldn't do any more belt-tightening without fundamentally changing the character of the university," said Peter French, Brandeis's chief operating officer and executive vice president. He noted that, as the trustees looked ahead at the next four or five years, they could see operating deficits of $10 million to $20 million a year and little likelihood of Brandeis regaining its $700 million endowment and 8% interest income until 2015.

What they could do instead is to pawn the art collection and redeem it when the endowment income is flowing again. Or, someone ought to come up with a self-liquidating security which pays out dividends until none of it is left. There's some kind of Treasury security like that-- is that what a Strip is?