← Previous Post: | Next Post:

 

A Charitable Harvard Grad

From Daily Finance:

… Goldman [Sachs] bet that mortgages would default while Harvard gambled that they’d keep paying. In February 2007, while Goldman made a nice profit, Harvard was among those on the losing side of the trade — forfeiting a portion of the $500 million of losses charged to four parties who wagered that the mortgages wouldn’t default.

Goldman’s response? According to the Boston Globe, in a Feb. 14, 2007, message on the plunge of sub-prime mortgages, Goldman executive Daniel Sparks wrote to colleagues including [Harvard graduate Lloyd] Blankfein, “That is good for us position-wise, bad for accounts who wrote that protection,” citing Harvard and three others.

… The Boston Globe [indeed] reported that the Harvard endowment, run by Harvard Management Corp., took on massive risk before the market meltdown of 2008. “The school in fiscal 2008 lost 27% of its $37 billion endowment and another $1.8 billion in operating cash because of bad investments,” The Globe said. The Ivy League school also paid $500 million to get out of failed interest-rate swaps, the newspaper reported.

… To be fair, of the $240 million Bloomberg News reports that Goldman paid him over the last decade, Blankfein has generously donated $2.735 million to Harvard, or 0.55% of the $500 million that Harvard and three other Goldman clients lost in their bad sub-prime bet against Goldman.

Margaret Soltan, May 10, 2010 2:55PM
Posted in: harvard: handouts

Trackback URL for this post:
https://www.margaretsoltan.com/wp-trackback.php?p=23187

Comment on this Entry

Latest UD posts at IHE

Archives

Categories