More information is coming out regarding the blunders that led to the tremendous decrease in not only Harvard’s endowment, but also its ability to pay day-to-day bills. According to a recent article in the Boston Globe, “The university disclosed yesterday that it had lost $1.8 billion in cash—money it relies on for the school’s everyday expenses—by investing it with its endowment fund, instead of keeping it in safe, bank-like accounts.” Evidently they moved the day-to-day money into endowment management as a way of increasing its return…a bad idea at any time, but even worse when the market goes south. Harvard also disclosed that they lost $500 million when they had to pay a fee to get out of a pre-existing investment contract. I would like to know what measures are being taken at Harvard—and elsewhere—to prevent this from happening in the future. As we have said before: investing University money as if it is a Wall Street hedge fund is simply not proper (in the strongest sense of the word). People’s lives depend on this money, and taking risk profiles from Wall Street and implanting them in the University was one of the worst moves that could have happened.

Copyleft, with restrictions, 2009–2010

info --at-- maicgregator ---dot--- org