Felix Salmon

Harvard donations: Down, not up

September 16, 2009

On Friday, I posted a chart which I thought showed donations to Harvard University rising substantially over the past couple of years, to over $1.6 billion a year. Boy was I wrong. As the Crimson reports, Harvard received $602 million in gifts this past fiscal year—an 8 percent year-on-year decline.

Hilton’s LBO unwinds

September 16, 2009

The LBO of Hilton hotels made no sense even at the time: I described it as crazy, adding that the lenders (including Bear Stearns, bless ’em) were “taking equity-like risk” for pretty modest returns. So it comes as no surprise to learn that Blackstone, the buyer, has not only written down its investment by half, but is also looking to restructure Hilton’s debt.

Are wages sticky after all?

September 16, 2009

Many thanks to David Leonhardt for the shout-out in his column today. Referencing an old blog entry of mine, he returns to the question of sticky wages and concludes that, contra the likes of Chris Swann, there really is something to it: “the sticky-wage theory,” he says, “seems to have survived the Great Recession”, with average weekly pay rising from $612 to $618 in nominal terms over the past few months, and even more in real terms.


September 15, 2009

The TED spread is just 16bp, lowest since 2004. No good can come of this. — PragCap

How endowments spend tuition payments

September 15, 2009

If you want a defense of the endowment style of investing, Michael Hennessy provides a really good one. Even he, however, admits that many endowments went way too far during the boom years:

Credit card chart of the day

September 15, 2009

John B just left me an interesting comment on the subject of credit cards:

Your statement on banks needing to focus on competing, rather than pages of agate type is correct. but is there a substantially large enough market of major credit card issuers to sustain true competition? I don’t think so. And probably not in a more regulated environment.

Wine sales league table of the day

September 15, 2009

Mike Veseth reprints the most depressing list I’ve seen in a long time:

The top ten individual wines (by volume not value of sales) in 2008 were (drum roll) …

The White House vs Henry Paulson

September 15, 2009

George Bush speechwriter Matt Latimer has an astonishing tale of what the economic crisis looked like from inside the White House — and it’s a must-read, even if GQ does force you to click the “next” button ten times in a row to read it.

A modest suggestion

September 15, 2009

Rupert Murdoch should try selling his iPhone app for a flat $1.99 and see how that works before jumping straight in to a model where he charges that much per week.