Our criticisms of the MSU administration are not credible unless we also examine UM
When appropriate.
Apparently, Dave Brandon is still employed at UM, he merely changed his name to L. Eric Lundberg and now runs the UM endowment investment area.
Reading this, he's a DB on the level of the original DB (Dave Brandon).
I personally smack MSU for its misdeeds at every opportunity. I'd be a hypocrite if I overlooked media reports of possible corruption on the UM campus.
Freep warning: https://www.freep.com/story/news/local/michigan/2018/05/04/university-m…
fiscal irresponsibility or potential fraud to the shit-show going on in E.L. seems a poor choice of what hill to die on.
Rape/Molestation and subsequent cover-up and denial seems a TAD more impactful. (/s for the TAD portion).
that the alleged fiscal irresponsibility involves a University endowment built on private donations, and not public funds. If donors don't like the way the University is managing its endowment, they can vote with their feet and stop donating. Is this also true of the MSU victims? Uh, no. Once again, the Freep tries to manufacture a scandal from a slow-moving audit while whistling past the MSU graveyard.
The two issues are very different and one has nothing to do with the other. This is where the OP is off base.
I read the Freep report and it raises questions that are concerning. $11 billion is way too much money to not have all the i's dotted and t's crossed. Management of the endowment should be a concern to all of us involved in the Michigan community as endowment funds benefit a vast number of programs and students.
Saying if donors don't like what is happening they should stop giving is nonsense. Do a sound audit, if there are problems address them and let people know you are running a tight ship.
You can do a back of the napkin audit, you don't have to wait for the University to open the kimono....just look at the endowment size every year as listed by the Univesity in their annual financials which they are required to file. I believe it breaks out beginning balance, additions to the endowmnet via donations and then the year end balance. Using those 3 numbers you can come to a reasonable conclusion as to how it's being run....if it lags the over all market, that's when you raise the alarm. If not, who gives a shit if alumni who donate to the University are ALSO running the endowment.
Sounds like a plan. Let's just use an index fund and be done with it, fiduciary responsibility notwithstanding. Have you read Schlissel's comments on the topic? If not, here is a link:
https://www.freep.com/story/news/local/michigan/2018/05/04/university-m…
The Freep is a great pain in the ass but that doesn't mean they are always wrong. In this case, from reading their article and other info, it seems that the process needs to be tightened up.
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I have a solid understanding of the audit process and realize, as an attorney and a CFA, it is complicated. My comment about choosing an index fund was to satisfy your point that the metric for comparison should be market performance. I should have included a "/s."
The University should invest the money in a sound manner consistent with capital preservation and a reasonable rate of return. VC? Really? Not sure I'd go that way for endowment funds. The problem with using alums as investors should be obvious. If bad investment decisions are made, you raise the potential for people to argue about impropiety/breach of fiduciary duty which is not a place you want to be. It isn't that we don't have alums that are competent investment people, I'm concerned about the ramifications should they choose poorly.
I'm also in the business and have advised on a few endowment fund allocations and I don't have a problem with VC activity. Especially when you hit $11b, the endowment should be invested as an entity that has an indefinite timeline (i.e., lives forever) so I'm in favor of having a decent chunk (5%-10%) in PE or VC type activities that take a long time to develop but have potential for outsized returns.
I understand your point on concerns for alumni but I don't see a breach in fiduciary duty if you select a qualified professional who also happens to have a degree from UofM. There are MANY such qualified individuals on wall street right now and cutting yourself off from access to those individuals seems like a mistake and bad investment decisions happen to ALL managers anyway.
Endowment funds don't have to be invested purely for rate of return scenarios....it's possible to invest ways that further the mission of the University and supporting alumni could, emphasis on could, be one of those reasons. A lot of endowment funds are now investing in socially conscious companies (green energy companies especially) that I would argue are not financially sound but they are doing it for social reasons more than economic ones.
You think Warren Buffet invests in index funds?
Double Post.
I'm not saying Michigan's management of its endowment is a non-issue or that there shouldn't be an audit -- which, by the way, is already underway. I'm just saying that any alleged mismanagement of the endowment -- much less the lack of transparency that the Freep is mostly complaining about -- does not exist in the same universe as MSU's malfeasance with Nassar. Obviously, it only makes sense to take steps to assure donors that their gifts are being managed properly -- otherwise, duh, the donations will dry up -- but donors clearly are able to defend themselves in a way that Nassar's victims were not.
I was very clear in my comment that the two topics should NOT be equated.
...is spotless. Michigan has never been deceptive relative to sexual assault allegations involving any of our athletes.
Homers like you are insufferable. Just because the UM issue isn't as bad as the MSU doesn't mean it's irrelevant. It's a serious issue and the paper was right to air it. Papers aren't in the business of telling you only what you want to hear, Vladimir. And it's absolutely not fake news.
Why not make an apples to apples comparison of say how the staee's endowment is run vs. Michigan's endowment. Does that make too much sense to do to the nitwits at the freep???
How did what he said, in any way, imply that what's going on at Michigan is irrelevant? He simply said that what's going on at MSU is more impactful.
Lots of major leaguers have embarased themselves in the batters box.
make me feel better after watching my 11 year-old son swing at a pitch that was in the catcher's glove already for strike 3 last night
...to remember to keep your eyes open.
there's that.
I get it... Cholula hot take!
is the type of thing that the NCAA shouldn't care about, because THIS has nothing to do with sports. If you are confused by my comment, see my thread on Nassar for a discussion on whether or not the NCAA should care about Nassar abusing student athletes.
This will not end well.
Much better than I had hoped.
I know, I can't stop watching it.
i like this thread much better now that i see it's a repository for funny GIFs.
Lundberg!
Time to dig out the torch and pitchfork.
While comparing the two is obviously like comparing apples to car parts, the sentiment of OP's comments rings true IMO. We can't totally rip on another school for their corruption and willful ignorance of what a faculty member does while simultaneously pretending like that cannot happen here. When a situation like this comes to light, I believe we should make sure that we (as alumni and as part of the university) take a look inwards and make sure that people in the administration here are of the most upstanding character and are people we want to represent the university. I see far too much LOL@MSU bullshit for my taste
OP is not making a case for "it could happen at UM" he's trying to draw moral equivalency between a delayed endowment audit and a class action sexual assualt case.
Maybe I misinterpreted it then, but that is what I got out of it. I definitely agree that trying to draw moral equivalency between the two is asinine
It's not a DELAYED audit - it's an audit that has been actively fought against by UM investment staff.
Huge difference.
what the article said. The University went out for second bid because they didn't believe that the first audit was done appropriately. The second audit is due to be completed in June.
Stop digging your hole.
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Kinda like how Brian did when he posted the mgoblog article about the MSU situation?