Monday, January 12, 2009

Harvard University and the Price of Oil

Harvard Endowment worked to reduce the amount that Americans drive their cars in 2008. Harvard Endowment joined other large investment banks and institutions speculating in Oil Futures on the American Mercantile Exchange. Investment specialists believe speculation caused wild price fluctuations of oil and gasoline in 2008. Among the speculators on oil futures was Harvard University Endowment. Some say it was greed that motivated Harvard's investment managers. Who is to say what is in the hearts and minds of investment managers? They can say that their goal was to reduce automobile emissions by raising gasoline prices. In 2008 Harvard's endowment reached $36 billion more than the Massachusetts state budget. Harvard purchased 81 acres of land in Boston which included part of an entrance to the Massachusetts Turnpike and railroad freight yards. By eliminating the rail yards goods will be transported by truck increasing the amount of pollution. Perhaps the rise in gasoline prices was meant to compensate for the increase in truck traffic. The potential for Harvard University to run candidates for high office appears to be within their ability. Harvard reported a $9 billion loss in their endowment in December 2008. These video clips are from a 60 Minutes feature broadcast on CBS on January 11, 2009.

This is a story in the New York Post about Harvard selling bonds to increase capital to replenish depleted endowments. (Bloomberg, "A lasting debt to schools," January 15, 2009, page 35)

Here is another story about Princeton getting a lower bond rate than Harvard from the Huffington Post.

Is this why universities have tax exemptions?

1 comment:

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