<p>^^It looks like Dartmouth is going to “tweak” their financial aid. Who knows how big a change “tweak” is a code word for? From the link in post #311:</p>
<p>'Kim emphasized that the College’s commitment to need-blind admissions will remain unaffected.</p>
<p>“I can’t imagine being part of a college that is only open to people who can pay,” Kim said. “So we will absolutely maintain our commitment to need-blind admission.”</p>
<p>Kim said that there may be ways in which the College’s financial aid program can be “tweaked” such that it works “more effectively.”</p>
<p>"We are going to make sure people who are currently Dartmouth students don’t find themselves unable to afford a Dartmouth education,” he said.'</p>
<p>^How, exactly, does one “tweak” an FA program to save money without affecting the school’s affordability? For example, inevitably some Dartmouth students are just barely affording the school on current FA and any “tweak” might push them over the edge.</p>
<p>^^Well, any time you spend less on finaid, someone is getting less money. That’s an unavoidable fact. I suppose the “tweak” will consist of adjusting the eligibility and/or size of the awards. </p>
<p>There has been an arms races in recent years among the Ivys and other highly-selective schools to lower EFC to zero for every accepted student whose family income is below some level. For Dartmouth I think the current cut-off is $75k. This is only my own speculation, but it wouldn’t surprise me to see Dartmouth and many of the other schools retreating from this arms race - going back to cut-offs and awards more like they were 4 or 5 years ago.</p>
<p>Article says most of the recent private equity IPO’s are being done to lower debt not send money back to their limited partners(endowments and pension funds).</p>
<p>do the limited partners own a direct stake in these companies once they go public? what’s the ratio of “sponsor” owned stock to outstanding capital?</p>
<p>Pension funds and endowments are the biggest purchasers of private equity and other alternative investments. I find it interesting that the new york pension fund has less than 10% of its assets in alternative investments, and because of the market rebound it is doing just fine. There was never really a bubble in the stock market, it was taken down by the real estate and private equity bubble so endowments that had a reasonable allocation to the stock market are doing just fine.
It really makes you wonder what these endowments that have 65-80% of their money in alternative investments plus significantly more money obligated to capital calls by pe firms were thinking.</p>
<p>In my opinion, no private elite will take back financial aid policies for current students unless things become mush worse than they are.
As an aside, Dartmouth has been basing its planning on 5% endowment returns this fiscal year and next. So far this fiscal year, domestic markets are up 20%, with foreign markets up more, and commodities up still more.
The steps Dartmouth and others are making are long overdue, but are unlikely to be as draconian as feared.</p>
<p>I think that at Harvard, the goal is to bring the size of the faculty to what it was before the rapid expansion of both faculty and endowment. But it is easier to expand a faculty in a rational way as programs are launched and gaps in offerings are filled than it is to shrink it, especially through retirements and/or moves.</p>
<p>I see that Harvard said it had an average return on its endowment of 8.9% a year for the last 10 years.</p>
<p>I noticed Harvard did not state its compounded returns.</p>
<p>Average returns are a very tricky thing.</p>
<p>I make 100% on my money the first year and then lose 50% the second year. With average returns I made 25% a year.
100%- 50% divided by 2.</p>
<p>Isn’t that great… I made a 25% average return.</p>
<p>How much did I really make though?</p>
<p>Lets’ use numbers.</p>
<p>I start out with 1 million dollars.
I make 100% on my money the first year…so I double my money. I now have $2 million.
Then I lose 50% the second year. 50% of $2 million is $1 million.</p>
<p>So I made 50% over a 2 year period. 25% average return a year. </p>
<p>And I made no money.</p>
<p>Because Harvard had the big percentage loss when it had the most money…I wonder what Harvard’s investment returns really are and how they are calculated.</p>
<p>When you read about Warren Buffet’s returns… he uses compounded returns. Which is why Buffett is Buffet.</p>
<p>dstark, if you did not point this out, I would always automatically assume that Harvard and other institutions were talking about compounded returns.</p>
<p>Harvard is a great school, but it doesn’t get to set the definitions of average and compounded returns.
Did Harvard state what their compounded returns are?</p>
<p>“Harvard treasurer James Rothenberg said in an Oct. 16, interview with the Harvard Gazette, a university publication, that over 10 years Harvard generated an average annual return of 8.9 percent, including last year’s losses.”</p>