(01-29-2015 09:01 PM)TodgeRodge Wrote:  

(01-29-2015 08:05 PM)banker Wrote:  Todge, last fiscal year they returned 15.4%. You can look it up, it's the first hit in Google. They have averaged 12% over the last 20 years.

http://www.hmc.harvard.edu

Oh, and Harvard costs $58,000 a year for tuition, room and board. They could charge $100,000 a year if they wanted, they have a 5% acceptance rate. Plenty of really rich people would pay whatever it took to get their kid in. Oh, and it's not like tuition is their only source of revenue.

I will give you this, you type a lot.

lets do the math a different way

http://www.nacubo.org/documents/research...isting.pdf

in FY 2001 the Harvard endowment was $17,950.483,000

if one goes with the "rule of 72" with a 10% return on average you would double your money every 7.2 years

the S&P average from 1987 to 2012 was 9.61% which would double the money every 7.5 years

that would of course taking zero money out to be spent to double that money every 7.5 years with an S&P type return

here we are looking at Harvard with $35,883,691,000 in FY 2014

if Harvard was strictly meeting conservative S&P returns and taking zero money out from 2001 when they were at $17,950.483,000 they would have doubled that by FY 2008 to $35,900,966,000

in 2008 they had doubled that money and in fact had done better than that they were at $36,556,284,000

http://www.nacubo.org/documents/research...tValue.pdf

and so from there they should be able to double that yet again in another 7 years right

well here we are 6 years later from 2008 looking at FY 2014 and the Harvard endowment is $35,883,691,000

http://www.nacubo.org/Documents/Endowmen...Values.pdf

so in 6 years from FY 2008 to FY 2014 Harvard has lost $672,593,000 of their endowment

so if you look at a very conservative investment strategy for the long term attempting to double your money every 7.5 years to keep up with the S&P and taking no money out Harvard should have gone from $17,950.483,000 in FY 2001 to $35,900.966 in FY 2008 (they actually beat that) and then they should have gone from $35,900.966 in FY 2008 to be on track to hit $71,801.932 in FY 2015 if they were beating the S&P even slightly

but instead 6 years into that 7 years they are lower by nearly $700 million than in FY 2008

so it is very clear that Harvard is spending a large amount of dollars out of their endowment and the returns from that endowment and over the last 6 years not only have they not come close to meeting any type of strategy for keeping endowment growth up with inflation they have actually watched the endowment decrease in real dollars with or without inflation

so if they were to attempt to spend more they could watch their endowment further decline and not come close to keeping up with inflation much less growing in the short or long term

and I am well aware that the tuition for Harvard LISTED is above the numbers that I used, but Harvard only has 6,700 undergrads along with 14,500 grad students and I would imagine the vast majority of those undergrads are not paying close to that tuition you listed and pretty much all of the graduate students are not going to be paying that when you look at stipends for teaching and or research

even if they were all paying that full rate it is still only 1.2 billion out of a 4.2 billion dollar budget so that is 3 billion you need to find elsewhere

you have $694 million in external research so that leaves a lot of money still to find elsewhere

Harvard has 2,400 faculty members and 10,400 academic appointments in teaching hospitals

http://www.harvard.edu/harvard-glance

so that is quite a number of people to pay and provide benefits for as well

and as that link states

UNDERGRADUATE COST AND FINANCIAL AID

Families with students on scholarship pay an average of $11,500 annually toward the cost of a Harvard education. More than 65 percent of Harvard College students receive scholarship aid, and the average grant this year is $46,000.

Since 2007, Harvard’s investment in financial aid has climbed by more than 70 percent, from $96.6 million to $166 million per year.

During the 2012-2013 academic year, students from families with incomes below $65,000, and with assets typical for that income level, will generally pay nothing toward the cost of attending Harvard College. Families with incomes between $65,000 and $150,000 will contribute from 0 to 10 percent of income, depending on individual circumstances. Significant financial aid also is available for families above those income ranges.


so again as I stated a massive amount of the students at Harvard pay nowhere close to $50K+ per year

when you look at the fact that Harvard has barely doubled their endowment (with both investment returns AND donations included) in 13 years and over the last 6 years with investment returns AND donations their endowment is still down nearly $700 million it is pretty clear to see they are spending from their endowment at pretty much the highest possible rate that they can without doing long term damage and as in one of the articles I linked there is already concern they are doing long term damage

and as for what their investment website states about annual returns.....I am sure they handle investments besides strictly the endowment like the retirement for all those thousands of workers and staff members and I would imagine the returns on investment they quote would include that money as well which would not be the actual endowment

that or for some reason Harvard has chosen to misrepresent their endowment returns to the NACUBO for over a decade

I don't know about how you or anyone else looks at finances, but when I am 13 years into something and I have only barely doubled my money that I have invested I am either spending too much or I am not getting a proper return and all the worse when I am adding external funds (donations in the case of Harvard) and still at that point

and when I am 6 years into something and down nearly 700 million including investment returns and annual additions of funds (donations for Harvard) the last thing I would tell myself if I had an annual budget of 4.2 billion to meet is "I am not spending enough from the endowment I should give more financial aid and build more buildings and give staff members big raises"

unless I want to go broke like a pro athlete or a lotto winner

the numbers CLEARLY show that Harvard is sending a great deal of money from their endowment and relative to total endowment and long term endowment returns and their financial aid numbers show they are very generous even to families that have well above a middle class income and they go to great lengths to make Harvard affordable for them

I linked the website to the company whose only function is to administer the Harvard Endowment. On the site they discuss their investment strategy, their results, their funding to the university, and even provide PDF files to their last several annual reports. In spite of that, you go on a 100 paragraph rampage built on hypotheticals and assumptions. Are you just bored or do you really think your analysis will prove more accurate than the actual, audited results provided by the firm that manages the endowment?

I do find it interesting that Harvard has 2,400 faculty members considering they have less than 10,000 students. So basically you're saying there's a 4 to 1 ratio?