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College endowment hoarding


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#21 stocks

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Posted 11 November 2013 - 04:53 AM

Many Senators seemed shocked to learn the sums colleges and universities had accumulated.


Dr. Gravelle has addressed the issue of how little additional endowment spending would be required to halt tuition hikes. I will not add to those remarks except to say that stopping tuition increases now is not enough.

Tuition has been going up so rapidly for so long it has reached nearly ungraspable levels. So let me put today’s tuition cost in concrete terms. Senators, what would your constituents say if gasoline cost $9.15 a gallon? Or if the price of milk was over $15? That is how much those items would cost if their price had gone up at the same rate that tuition has since 1980.

I believe that skyrocketing tuition is undoubtedly the biggest “access” problem in higher education. What can possibly be more discouraging to a capable student whose parents are not wealthy than a school with a $45,000 price tag on the door?

Here’s another concrete comparison. The total worth of the top 25 college and university endowments is $11 billion greater than the combined assets of the 25 largest private foundations — including the Gates Foundation, Ford, and Rockefeller.
Private foundations have fewer assets and, in part because they give away more of their money, are growing far less. Yet they are spending more—their payout averaged 7% in 2005 even though they are legally required to spend just 5%.

Yale law professor Henry Hansmann has said that “A stranger from Mars who looks at private universities would probably say they are institutions whose business is to manage large pools of investment assets and that they run educational institutions on the side…to act as buffers for the investment pools.”

Senators, our colleges and universities need to be reminded that they are education institutions first and foremost—and that that is why they receive the enormous tax breaks they do. Their practices, including their handling of endowment monies, should reflect their priorities as educators.

http://collegeafford...t-hoarding.html


Harvard University, the world’s richest college, lost $345.3 million terminating interest-rate swaps last year, bringing its cost of unwinding debt derivatives since 2008 to more than $1.25 billion.


The school agreed to many of the swaps when former President Lawrence Summers was planning to build the Allston campus, including a $1 billion science center. The swaps, which locked in interest rates for Harvard, also required the school to post collateral if rates fell. Harvard officials said that the hedges on debt that remain are unrelated to Allston.

After Drew Faust succeeded Summers as president, the school terminated swaps to avoid posting millions in collateral. Faust put the expansion plan on hold as Harvard’s frayed finances forced the school to take budget-cutting measures, including cutting some student services.


http://www.bloomberg...-2012-2013.html

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#22 stocks

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Posted 08 January 2014 - 01:40 PM

The disposable academic
Why doing a PhD is often a waste of time

The Number of Ph.D.s on Public Aid Triples in U.S.

The life of an academic who pays hundreds of thousands of dollars in tuition and lives off stipends and scholarhips is becoming more financially treacherous. A skyrocketing number of Americans with Ph.D.s say they are facing
a reality in which they are turning to food stamps to survive.

One in six Americans received food stamps or other public assistance last year, but the number of people with a Ph.D. or Masters degree who receive that aid has tripled in the past two years, according to government data.


http://abcnews.go.co...58#.T6u8Py-2651


Grad School Death Spiral

The system is now coming undone. There aren’t many jobs for entry level doctoral grads, and even fewer for tenure track. Oversupply pushes wages down and keeps desperate hangers-on thronging around looking for adjunct positions. Older professors who were once obliged to retire at 65 now keep teaching. The result is a huge jobs crush.

To resolve the oversupply, we’re going to have to close down many PhD-generating graduate programs and shrink most others. The result will be that demand for professors in the affected field will shrink even more. With fewer grad students to teach, most schools will not need the large tenured faculties they have today, and tenure positions will shrink more still. That in turn should lead to another round of grad school shrinking—even fewer openings as more universities cut department size to adjust to the shrinkage of grad school programs—until at some point the process reaches an equilibrium.



http://www.the-ameri...s-still-coming/

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#23 stocks

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Posted 23 January 2014 - 03:26 PM

Thank God I wasn’t college material

I hear plenty about the corrupt hucksters on Wall Street, why aren’t we talking about the wealthy con artists in academia who turn absurd profits by convincing broke kids
to bankrupt themselves?


Total student debt has gone up by 275 percent in the last decade. How far will it climb, how many more kids will be thrown to the wolves, before we change direction?
Since I was born, college tuition rates have gone up by 500 percent. FIVE HUNDRED PERCENT. Why do we send guys like Bernie Madoff to prison while the academic elite get away
with gouging an entire generation to death?

We set up an artificial construct whereby degrees were suddenly “needed” for things like business, sales, and even writing. This house of cards is beginning to tumble, as employers are realizing
that, shockingly, they need people who can actually DO the job. They need talent — not paperwork. New college graduates are left unemployed because they often expect too much and offer
too little.


http://themattwalshb...llege-material/

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#24 stocks

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Posted 23 June 2014 - 10:42 AM

Mark Cuban: The Coming Meltdown in College Education & Why The Economy Won’t Get Better Any Time Soon

The competition from new forms of education is starting to appear. Particularly in the tech world. Online and physical classrooms are popping up everywhere. They respond to needs in the market. THey work with local businesses to tailor the education to corporate needs. In essence assuring those who excel that they will get a job. All for far far less money than traditional schools.

The number of people being prepared for the work world in these educational environments is exploding.

You would think traditional university educators would take notice. Beyond allowing some of their classes to be offered online, they haven’t. They won’t. Its the ultimate Innovators Dilemma. They don’t believe they should change and they won’t. Until its too late. Just as CEOs push for that one more penny per share in EPS, University Presidents care about nothing but getting their endowments and revenues up. If it means saddling an entire generation with obscene amounts of school debt, they could care less. This is how they get their long term contracts and raises.

It’s just a matter of time until we see a meltdown in traditional college education. Like the real estate industry, prices will rise until the market revolts. Then it will be too late. Students will stop taking out the loans traditional Universities expect them to. And when they do tuition will come down. And when prices come down Universities will have to cut costs beyond what they are able to. They will have so many legacy costs, from tenured professors to construction projects to research they will be saddled with legacy costs and debt in much the same way the newspaper industry was. Which will all lead to a de-levering and a de-stabilization of the University system as we know it.

And it can’t happen fast enough.


http://blogmaverick....-any-time-soon/


MARK CUBAN: 'The Student Loan Bubble Is Going To Burst'

The end of the student loan bubble will be like the housing bubble, where tuition collapses the way the price of homes collapsed.

"It's inevitable at some point there will be a cap on student loan guarantees. And when that happens you're going to see a repeat of what we saw in the housing market: when easy credit for buying or flipping a house disappeared we saw a collapse in the price housing, and we're going to see that same collapse in the price of student tuition, and that's going to lead to colleges going out of business."



Read more: http://www.businessi...6#ixzz35TezfoCT

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#25 stocks

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Posted 01 May 2015 - 11:33 AM

MARK CUBAN: 'The Student Loan Bubble Is Going To Burst'

"It's inevitable at some point there will be a cap on student loan guarantees. And when that happens you're going to see a repeat of what we saw in the housing market: when easy credit for buying or flipping a house disappeared we saw a collapse in the price housing, and we're going to see that same collapse in the price of student tuition, and that's going to lead to colleges going out of business."


After 114 years, Sweet Briar College revealed this week that it would close after the spring 2015 semester.

One person not surprised was Mark Cuban, the entrepreneur and billionaire investor. For years, Cuban has been warning of a "student loan bubble," which he says will soon burst and leave many schools suffering.

This debt ultimately will outweigh most of the potential benefit you're getting from the college.

CURRENT STUDENT LOAN DEBT IN THE UNITED STATES

Student Loans : $1,318,322,000,000.00

Credit Cards: $882,600,000,000.00

Auto Loans: $750,000,000,000.00



http://www.businessi...e-crisis-2015-3

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A nation of sheep will beget a government of wolves.― Edward R. Murrow

 

 


#26 stocks

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Posted 15 April 2016 - 04:19 AM

Education bubble, education taboo

“A true bubble is when something is overvalued and intensely believed,” he says. “Education may be the only thing people still believe in in the United States. To question education is really dangerous. It is the absolute taboo. It’s like telling the world there’s no Santa Claus.”

Like the housing bubble, the education bubble is about security and insurance against the future. Both whisper a seductive promise into the ears of worried Americans: Do this and you will be safe. The excesses of both were always excused by a core national belief that no matter what happens in the world, these were the best investments you could make. Housing prices would always go up, and you will always make more money if you are college educated.

Like any good bubble, this belief– while rooted in truth– gets pushed to unhealthy levels. Thiel talks about consumption masquerading as investment during the housing bubble, as people would take out speculative interest-only loans to get a bigger house with a pool and tell themselves they were being frugal and saving for retirement. Similarly, the idea that attending Harvard is all about learning? Yeah. No one pays a quarter of a million dollars just to read Chaucer. The implicit promise is that you work hard to get there, and then you are set for life. It can lead to an unhealthy sense of entitlement. “It’s what you’ve been told all your life, and it’s how schools rationalize a quarter of a million dollars in debt,” Thiel says.”

 

 

Peter Thiel:  College is as corrupt as the Catholic Church was 500 years ago.

 

 

http://www.bloomberg...h-500-years-ago


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A nation of sheep will beget a government of wolves.― Edward R. Murrow

 

 


#27 stocks

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Posted 22 April 2016 - 09:36 AM

Blanket Student Debt Amnesty Now

 

“Carlo Salerno, an economist who studies higher education and has consulted for the private student-lending industry, noted that the government imposes virtually no credit checks on borrowers, requires no cosigners and doesn’t screen people for their preparedness for college-level course work. “On what planet does a financing vehicle with those kinds of terms and those kinds of performance metrics make sense,” he said.” (WSJ)

The Fed, government regulators and the entire political establishment looked the other way while the mortgage industry cranked out trillions of dollars of “toxic” subprime liar’s loans that Wall Street bundled into garbage bonds that wound up blowing up the entire global financial system and plunging the world into a severe recession from which we still haven’t recovered. Then, a couple years later, they start pumping up another lethal trillion-dollar credit bubble, this time comprised of equally toxic “student liar’s loans”?

 

 

http://www.unz.com/m...bt-amnesty-now/


Edited by stocks, 22 April 2016 - 09:37 AM.

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#28 stocks

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Posted 06 May 2017 - 10:08 AM

The scam we call college.     

 

Perhaps one of the most shameful examples of the predatory outlook towards students is that of college sports, the ones that generate millions of dollars for the universities. None of the players get a penny from the income generated. 

 

The reason that colleges are notoriously expensive is because they are bureaucracies with top-heavy deadwood that grow like cancer. Absurdly overpaid positions like Dean of Men, Dean of Women, Director of Inclusivity, Dean of Student Affairs do absolutely nothing of any consequence.   

 

Departments like Minority Studies and Gender Studies do actual harm where intense hatred is fostered on students and encouraged. They exist only to placate the entrenched, vicious, Politically Correct cadres. These departments provide jobs for people whose only marketable skill is screaming

 

Aside from the expensive classes, the students have to pay through the nose for exorbitant textbooks, many of which are unnecessary since the professor’s lectures are verbatim from the text.   

 

 


Read more: http://www.americant...l#ixzz4gJJaPiGc 
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#29 stocks

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Posted 24 June 2017 - 05:58 PM

 

Education bubble, education taboo

“A true bubble is when something is overvalued and intensely believed,” he says. “Education may be the only thing people still believe in in the United States. To question education is really dangerous. It is the absolute taboo. It’s like telling the world there’s no Santa Claus.”

 

 

Peter Thiel:  College is as corrupt as the Catholic Church was 500 years ago.

 

 

How Higher Education Became An Obscenely Profitable Racket 

 

Consider the study Academically Adrift: Limited Learning on College Campuses which concluded that "American higher education is characterized by limited or no learning for a large proportion of students."

 

While the majority of students learn little or nothing of value, the legions of overpaid administrators have expanded like rats on a verdant island (i.e. an island with unlimited money via student loans).

 

In all, from 1987 until 2011-12--the most recent academic year for which comparable figures are available—universities and colleges collectively added 517,636 administrators and professional employees, according to the analysis by the New England Center for Investigative Reporting.

 

"There’s just a mind-boggling amount of money per student that’s being spent on administration," said Andrew Gillen, a senior researcher at the institutes. "It raises a question of priorities." 

 

 

 http://www.zerohedge...ofitable-racket


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A nation of sheep will beget a government of wolves.― Edward R. Murrow