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Only a year ago, Harvard had a $36.9 billion endowment, the largest in academia. Now that endowment has imploded Was anyone able to get through all 6 pages and

Only a year ago, Harvard had a $36.9 billion endowment, the largest in academia. Now that endowment has imploded Was anyone able to get through all 6 pages and find what exactly imploded means?

ajross 17y ago
The important details are on the second page, and the explanation isn't very clear. But at it's core this is a liquidity crisis. Harvard hasn't lost all that much (maybe 25% if the $8B number holds up). But as a result of the recent aggressive investments, huge chunks of its endowment is in illiquid assets that can't themselves be used to fund the university. Combine that with some very liberal spending projects in recent years, and suddenly this very wealthy university can't actually pay its bills.
- roc 17y ago
  Which is another way of saying: Harvard is still in denial. They (like many) are refusing to admit that they made bad investments that are no longer worth what they once were. So they're trying like hell to avoid realizing those losses, because that red ink would go on their permanent record. Which is tantamount to career suicide. (Hence the blame-gaming at all levels)
  - Retric 17y ago
    Selling in a down market can often be worse than debt. The cuts are extreme because they need to start thinking 1/2 the ROI * 70% of the endowment or ~35% of last year’s income. They must do a huge drop in spending over the next 10 years or they are going to actually run out of money.
    - roc 17y ago
      Assuming we're merely in a down market. Which is the standpoint which I categorize as 'denial'.
CamperBob 17y ago
Not me. Typically the last line I read in an article like that is the one that says "Page 1 of 6." I was curious to discover what happened to the $37 billion, but it was clear the author had other plans.
- BearOfNH 17y ago
  Try Firefox with the AutoPager extension. Just keep scrolling down and the follow-on pages appear. Not perfect, but adequate. And don't blame the author -- the magazine did the pagination.
  - CamperBob 17y ago
    Sorry, I should've been clearer: I wasn't complaining about the pagination, I was complaining about the lack of anything resembling editing. You don't need six long pages to explain the presence of financial mismanagement at a large institution. It would be nice if I had the personal bandwidth to read that much text to get a simple summary of the issues, but I don't. I found it interesting that my comment was modded down lower than another that questions the whole point behind Harvard's existence.
    - biohacker42 17y ago
      I think many journalists are paid by the word. I'm not sure if this worse or better then programmers being paid based on number of bugs found and fixed.
    - pbhjpbhj 17y ago
      I actual appreciated the historical background, the information about the Management Company, the loose focus on the main issue, the commentary and evidence gathering. It is a complicated situation with multiple reasons for the failure and with wide ranging repercussions, I paragraph wouldn't real do it. If you want the executive summary then - Uni financial managers got rich, bailed, made greed based short term decisions which when recessions came wiped out most of the financial reserve; other managers locked up the rest in assets with poor liquidity.

Only a year ago, Harvard had a $36.9 billion endowment, the largest in academia. Now that endowment has imploded Was anyone able to get through all 6 pages and find what exactly imploded means?

ajross 17y ago

The important details are on the second page, and the explanation isn't very clear. But at it's core this is a liquidity crisis. Harvard hasn't lost all that much (maybe 25% if the $8B number holds up). But as a result of the recent aggressive investments, huge chunks of its endowment is in illiquid assets that can't themselves be used to fund the university. Combine that with some very liberal spending projects in recent years, and suddenly this very wealthy university can't actually pay its bills.

roc 17y ago
Which is another way of saying: Harvard is still in denial. They (like many) are refusing to admit that they made bad investments that are no longer worth what they once were. So they're trying like hell to avoid realizing those losses, because that red ink would go on their permanent record. Which is tantamount to career suicide. (Hence the blame-gaming at all levels)
- Retric 17y ago
  Selling in a down market can often be worse than debt. The cuts are extreme because they need to start thinking 1/2 the ROI * 70% of the endowment or ~35% of last year’s income. They must do a huge drop in spending over the next 10 years or they are going to actually run out of money.
  - roc 17y ago
    Assuming we're merely in a down market. Which is the standpoint which I categorize as 'denial'.

CamperBob 17y ago

Not me. Typically the last line I read in an article like that is the one that says "Page 1 of 6." I was curious to discover what happened to the $37 billion, but it was clear the author had other plans.

BearOfNH 17y ago
Try Firefox with the AutoPager extension. Just keep scrolling down and the follow-on pages appear. Not perfect, but adequate. And don't blame the author -- the magazine did the pagination.
- CamperBob 17y ago
  Sorry, I should've been clearer: I wasn't complaining about the pagination, I was complaining about the lack of anything resembling editing. You don't need six long pages to explain the presence of financial mismanagement at a large institution. It would be nice if I had the personal bandwidth to read that much text to get a simple summary of the issues, but I don't. I found it interesting that my comment was modded down lower than another that questions the whole point behind Harvard's existence.
  - biohacker42 17y ago
    I think many journalists are paid by the word. I'm not sure if this worse or better then programmers being paid based on number of bugs found and fixed.
  - pbhjpbhj 17y ago
    I actual appreciated the historical background, the information about the Management Company, the loose focus on the main issue, the commentary and evidence gathering. It is a complicated situation with multiple reasons for the failure and with wide ranging repercussions, I paragraph wouldn't real do it. If you want the executive summary then - Uni financial managers got rich, bailed, made greed based short term decisions which when recessions came wiped out most of the financial reserve; other managers locked up the rest in assets with poor liquidity.