Oct. 17 (Bloomberg) -- Harvard Universityâs failed bet that interest rates would rise cost the worldâs richest school at least $500 million in payments to escape derivatives that backfired.
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Harvard has frozen employee salaries, slowed hiring, cut staff and offered other workers early retirement as part of a cost-cutting program to compensate for losses in its endowment. The fund, which dropped to $26 billion in value over the fiscal year from $36.9 billion, paid 38 percent of the schoolâs bills during that time, the report said.
The university disclosed yesterday that it had lost $1.8 billion in cash - money it relies on for the schoolâs everyday expenses - by investing it with its endowment fund, instead of keeping it in safe, bank-like accounts. The disclosure was made in the schoolâs annual report for the fiscal year that ended June 30.
the retards weren't even paying attention to basic risk management, risking money that they couldn't afford lose, trading with money that they had earmarked for other activities, and going all-in on their counter-trend derivatives trade, among other bad bets.
... exactly!