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So, its this really caused by them borrowing $170m to play the stock market? What were they thinking?! Also: What happened with the failed fundraising drive?

by luke_s 13y ago

So, its this really caused by them borrowing $170m to play the stock market? What were they thinking?! Also: What happened with the failed fundraising drive? I would have thought such an exclusive school would have had many well off graduates, who would be happy to help out their old school in its hour of need.

bkanber 13y ago
Not quite. The media saying that the loan was for playing with the stock market is erroneous. The $175M loan was to build a new building in the east village. However, when the building was complete, some geniuses decided that the leftover money would be better spent in the stock market rather than using it towards paying back MetLife. They did calculations and saw that the gains from new investments would outpace losses from the additional interest. It was a hedge, basically. But then the recession hit, and naturally that investment failed, leaving Cooper both without gains from the investment AND with extra debt burden.