Whair the smart pepul are - Harvard University
Have to laugh -- I know that I am picking low-hanging fruit and I have a particular antipathy toward the East-coast elite liberal universities but still...
From
Bloomburg:
Harvard’s Bet on Interest Rate Rise Cost $500 Million to Exit
Harvard University’s failed bet that interest rates would rise cost the world’s richest school at least $500 million in payments to escape derivatives that backfired.
Harvard paid $497.6 million to investment banks during the fiscal year ended June 30 to get out of $1.1 billion of interest-rate swaps intended to hedge variable-rate debt for capital projects, the school’s annual report said. The university in Cambridge, Massachusetts, said it also agreed to pay $425 million over 30 to 40 years to offset an additional $764 million in swaps.
A bit more:
“Substantial losses” in Harvard’s General Operating Account, a pool of cash from which bills are paid, further put pressure on the school, the report said. The net asset value of the account fell to $3.7 billion from $6.6 billion during the fiscal year, according to the report.
Harvard has typically invested a large portion of this operating account alongside the endowment, generating “significant positive investment results,” the report said. This year, the endowment’s losses hurt Harvard’s cash, according to the report.
And a lot of the money that would come in from alumni donations has slowed to a trickle. A lot of these intelligentsia had their money with
Bernie.
How people could miss that this recession was going to be a long and brutal haul amazes me. Interest rates will not rise until people start spending more and people will not be spending more until taxes go down and money frees up. Don't these idiots read
Roubini?
Posted by DaveH at October 17, 2009 8:00 PM
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