Faust Fights Back!
Posted on July 2nd, 2009 in Uncategorized |
She issued a response to the Vanity Fair article claiming that the endowment would be down only 22-23%.
According to the Boston Herald, Faust says 30% is still the magic number.
She writes:
… “the virtually unprecedented market conditions of the past year lead us to believe that, when the valuations on all of our illiquid investments come in and our year officially closes, our returns will be in line with our earlier projections of a 30 percent decline, and in line with our peers who are following similar investment strategies. Recently reported assertions about Harvard’s endowment performance are inaccurate.”
My guess is still 27-28%…with the caveat that the number is virtually meaningless, because you can’t trust the valuations of the illiquid investments. But it’s interesting that Faust felt compelled to respond to an anonymous quote….
12 Responses
7/2/2024 6:47 am
The Herald? What even H gave up on the Globe?
7/2/2024 8:21 am
And yet Faust has still not taken even a symbolic pay cut.
7/2/2024 9:17 am
This is bizarre. Why would she feel compelled to publicly respond that the situation is even worse than VF reports? I don’t get the strategy.
7/2/2024 9:31 am
She’s lowering expectations, anon. Which is appropriate, I think. You wouldn’t want people to get their hopes up, then have things come in lower….
What you want to do is set expectations at 30%, then beat them slightly, so it appears to be actually *good* news…
7/2/2024 9:48 am
My 25.8% is looking good.
7/2/2024 10:07 am
This is a distraction. Whether the endowment lost 22 or 30 per cent (and as Richard says these numbers are soft anyhow), the big questions are where are the big cuts to be made, by whom and by what criteria? The cuts so far don’t come close to dealing with the problem in FAS. The Dean has just lost his new Administrative Dean (the parallel with Faust’s executive VP makes it even more disturbing). And the Dean credits the departing dean with bringing a new level of transparency to the process, which is exactly what many department chairs have found lacking. We are in big trouble with maladroit leadership. Ironically, although Summers was the wrong leader for his time, and created some of this mess, his kind of leadership may be just what we need to get out of it. (I know- there were integrity problems, which we don’t need now, but I am feeling desperate.)
7/2/2024 10:14 am
So, less conditional/soft power approach and more condign power to settle scores ahem…address the financial situation.
7/2/2024 10:29 am
Or from my seat, the populus Romanus pining for its Augustus strong man and end of chaotic republic. No, thanks.
7/2/2024 11:15 am
Hey, Senator Lewis, it’s July 2, so you’re now on Faculty Council. Time to get going there, I say.
7/2/2024 4:57 pm
I am distressed too, but as RT implies we are not yet THAT desperate. The dual departures of Forst and Sweet are signs of a serious management/leadership problem in key positions at a critical moment (whether the cause was a misjudgment in hiring, inadequate support, dissatisfaction on the part of either party, inadequate efforts at retention, and so on). Nevertheless, Faust and Smith are well intentioned, have the right values, and are honest-which is more than one can say about our previous president.
7/2/2024 11:53 pm
So is a cat. Right values, et al. Not enough in the current circumstances.
7/3/2024 7:06 am
What evidence do we have that Faust and especially Smith have the right values? I don’t think there have been any decisions or actions that have shown any special attention being paid to Harvard’s mission. We have seen the cancellation of the purchase of a helium liquefier, the indefinite slowdown of the construction of the new science center in Allston, and a reduction in staff at the libraries. I’m not saying that those were necessarily the wrong decisions, but at no point has anyone come out and talked about how those decisions fit with Harvard’s values and with a comprehensive plan for eliminating the deficit without compromising academic quality. You know what else we’ve seen? We’ve seen an expansion in the FAS central administration that allows Mike Smith to both avoid making difficult decisions and then avoid taking responsibility for them. Instead, he can just point to the Divisional Deans, the Deans of GSAS and the College, or any of the countless administrative deans who seem to have sprung up over the last couple of years.