Another sign of the end of growth: college endowments up 0.3%

[mooncliff]

There was about a 20% return last year, but for the last five years or so, it has been bad.

http://www.bloomberg.com/news/2012-1...ment-loss.html

Similarly, this is why I expect a lot of pensions to be in big trouble in just a few years. They all assumed a return of 8%, but they are getting essentially zero.

[dcarrigg]

Re: Another sign of the end of growth: college endowments up 0.3%

There was about a 20% return last year, but for the last five years or so, it has been bad.http://www.bloomberg.com/news/2012-1...ment-loss.htmlSimilarly, this is why I expect a lot of pensions to be in big trouble in just a few years. They all assumed a return of 8%, but they are getting essentially zero.

ZIRP, there it is.

[don]

Re: Another sign of the end of growth: college endowments up 0.3%

ZIRP accomplishes many things. The transfer of wealth being near the top.

[doom&gloom]

Re: Another sign of the end of growth: college endowments up 0.3%

Hard to steal it all from you when you mostly don't participate.

[Thailandnotes]

Re: Another sign of the end of growth: college endowments up 0.3%

http://www.counterpunch.org/2012/10/...ners-of-today/

[seobook]

Re: Another sign of the end of growth: college endowments up 0.3%

Hard to steal it all from you when you mostly don't participate.

even passively you eat inflation, right? a couple percent a year adds up after 30 or 40 years if you are young & it is also a disaster when you are old + don't have much earning power too.

with all the forms of propping up real estate that the US has done one might think that they would hugely expand visa programs for rich foreigners, but I haven't really seen any news of that. wouldn't that be more efficient than soaking everyone with inflation while simultaneously destroying pension plans?

[Milton Kuo]

Re: Another sign of the end of growth: college endowments up 0.3%

even passively you eat inflation, right? a couple percent a year adds up after 30 or 40 years if you are young & it is also a disaster when you are old + don't have much earning power too.

I think doom&gloom means that he doesn't participate by not putting his money into those things that Bernanke manipulates: bonds, stocks, and cash.

Thinking about it, buying gold is perhaps the ultimate f- you to Bernanke and his bag of tricks.

[doom&gloom]

Re: Another sign of the end of growth: college endowments up 0.3%

yup, mostly metals and farmland.

[raja]

Re: Another sign of the end of growth: college endowments up 0.3%

Thinking about it, buying gold is perhaps the ultimate f- you to Bernanke and his bag of tricks.

I wish . . . but in reality it's not the case . . . .

Investments that go way up from fiat inflation will be subject to inflation tax.
For example, if you bought an ounce of gold when the price was $250, and later you sell when the price is $2250, you are paying 28% on $2000 profit = $560. In addition, the remaining profit you keep of a nominal $1440 will have a real value of $144 due to inflation. So, this investment only loses you $131 of your original $250
It's far worse if Rickards prediction comes true, and there's a windfall profits tax of 90% after the creation of a New Dollar.

If you buy a business with assets -- and never sell the business -- you will receive ongoing inflation-indexed rising income, plus you will avoid any inflation tax.

The trick is knowing which businesses will prosper or at least survive the coming crash . . . .

[stetts]

Re: Another sign of the end of growth: college endowments up 0.3%

raja,
You said, "If you buy a business with assets -- and never sell the business -- you will receive ongoing inflation-indexed rising income, plus you will avoid any inflation tax. The trick is knowing which businesses will prosper or at least survive the coming crash . . . . "

I believe this is the best conclusion I've seen yet. It's work, but is available to anyone. No tricks--just the daily, grinding work of making a business successful. If you have some capital, search for a capital-intensive business. If little capital, use more of your ingenuity and time. Either way, it's all work.

Thanks. Stetts

[davidstvz]

Re: Another sign of the end of growth: college endowments up 0.3%

http://www.counterpunch.org/2012/10/...ners-of-today/

I wonder how annual growth in university attendance looks compared to population growth going back 30 or 40 years. I'm sure attendance has grown faster than the rate of population growth, hence some amount of cost increase faster than inflation would be necessary to expand facilities.

The article suggests that increased fees are only supposed to pay for teacher salaries and maybe a little administration overhead, but that's ridiculous.

The source of outrage from students was that the pledge of fees as collateral on this type of debt contradicted what the fees were supposed to pay for – education in the form of faculty salaries and a little administrative overhead.

Facilities and additional administration are precisely where the extra money needs to go to allow for expansion that is dictated by high demand.

I honestly don't see much of a problem except in the more general problem that education doesn't always result in a lucrative career, hence the high cost of education is in part due to naive students overestimating their future prospects when signing on to pay the loans.

Perhaps there should be an annual limit on tuition hikes for students who start a degree program. So hikes beyond the limit would only apply to incoming freshmen who, having not invested any time or money yet, can fairly assess whether or not the cost is worth it.

Parents need to wise up and start looking after their kids in this regard. The kids aren't wise enough to do it.