<p>Harvard</a>, Yale Are Big Losers in 'The Game' of Investing - WSJ.com </p>
<p>"Harvard University and Yale University, such fierce rivals that their fall football contest is known to both sides simply as 'The Game,' badly trailed the results of the typical college in the latest year. The dismal returns have exposed weaknesses in their exotic approach to investing, which after turning in chart-topping performance for years has proved to be highly risky."</p>
<p>Perhaps this is one very small measure of justice for the major role that Harvard MBAs played in the meltdown of the economy. Their dismal returns shouldn’t come as any surprise—just as further verification of their profound financial incompetence.</p>
<p>As far as I can tell though, they still come out on top in the long-term returns. Even after the huge dip in their fortunes, the preceding rise was so immense that they still outpace the other 6 Ivies, Stanford, etc…</p>
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<p>This assumes that there has been a serious attempt to value the non-liquid assets held by these institutions, which they have recognized they have not done. There has been no attempt to mark these assets to market and most of them are completely illiquid and will remain so for a long time. They have unsuccesfully tried to sell off some their holdings in private equity and real estate and were only offered pennies on the dollar. </p>
<p>A strong indicator of the poor quality of the assets they hold is the huge amounts of borrowings they have had to do simply to pay for operating expenses. Their current risky bet is that they can borrow themselves out of their troubles until the private equity markets recover. That may take a really long time. If that is the case, the strong bond ratings they currently get will take a dive. If they can no longer borrow, they may be forced to dump their illiquid assets. Only then will we really know what their endowments are really worth.</p>
<p>The big elephant in the room that nobody is talking about is that the so called experts on investment strategies, who took hundreds of millions in fees for their so called expertise, up front…didnt tell their clients, from moms and pops to Harvard and Yale what was coming, though it was obvious to anyone with a lick of common sense we were in an unsustainable bubble…with horrendous government decisions by the Fed, Congress and several presidents…and none of these so called experts did what they were supposed to do: protect their clients from this tsunami of devastation. None of them. Its been the most egregious and biggest act of professional malpractice in the history of financial management. Ever. </p>
<p>They should be sued and put out of business. These so called wizards of high finance, many of whom have MBA’s from Harvard, Stanford,Yale etc…have been an utter disaster. Overpaid goons. A lesson learned.</p>