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Income Inequality / Inflation Watch: Princeton Endowment Manager's Edition

Tyler Durden's picture




 

Princeton University paid four of its endowment managers a combined $9.2 million in 2013. As Bloomberg reports, this is a 46% increase from a year earlier and four times the increase Harvard University paid its top investors. We are sure they earned it - besides, last year was a difficult year for every asset manager eh (even as the endowment gained only 11.7% last year - average for large endowments? But as one apologist noted "It's easy to whack these guys," - yes it is! But while "it looks big in percentage terms, it’s a basis point or two compared to the endowment," - oh well that makes it ok then. Once again, it pays to be in the 'elite'.

As Bloomberg reports, Princeton University paid four of its endowment managers a combined $9.2 million in 2013, a 46 percent increase from a year earlier and four times the increase Harvard University paid its top investors.

Andrew Golden, the president of Princeton University Investment Co., the company known as Princo that manages the school’s $18.2 billion endowment, collected $3.9 million in total compensation last year. The 55-year-old’s remuneration included a 94 percent increase in retirement and deferred compensation and a 48 percent jump in bonus pay, according to the university’s latest tax return.

However,

The endowment returned 11.7 percent last year, matching the average return posted by endowments greater than $1 billion, according to the National Association of College and University Business Officers and Commonfund Institute’s 2013 endowment study.

So they deserve the raise, right?

“It’s easy to whack these guys,” Charles Skorina, founder of a San Francisco-based executive search firm specializing in investment management, said by phone. “It looks big in percentage terms, but it’s a basis point or two compared to the endowment.”

And summing it all up...

The number of presidents at public universities who made at least $1 million increased to nine from four during the 2012-2013 school year, according to a report by the Chronicle of Higher Education released Sunday. The Institute for Policy Studies published a report on Sunday that revealed that the public universities with the highest executive compensation also tend to have the fastest growth in student debt and use of lower-paid adjunct faculty.

It's good to be king.

 

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Wed, 05/21/2014 - 19:30 | 4783110 LetThemEatRand
LetThemEatRand's picture

I don't get the reason for the last paragraph re presidents at public universities.  Princeton is a private muppet.  And at least a Princeton diploma gets you a shot at membership to the Big Club.  The public university Presidents' pay is a joke, but it's a different joke than the rest of this article.

Wed, 05/21/2014 - 19:40 | 4783144 Harbanger
Harbanger's picture

Socialist scumbag Professors milking the system for all the $$ they can.  Don't you find some hypocrisy in that Lola?

Wed, 05/21/2014 - 19:43 | 4783155 James_Cole
James_Cole's picture

Socialist scumbag Professors milking the system for all the $$ they can.  

Huh?

This is a good one though:

But while "it looks big in percentage terms, it’s a basis point or two compared to the endowment," - oh well that makes it ok then. Once again, it pays to be in the 'elite'.

What's a few basis pts among friends?

Wed, 05/21/2014 - 19:48 | 4783168 McMolotov
McMolotov's picture

In 27 states, a college football coach is the highest-paid public employee:

http://www.thefiscaltimes.com/Articles/2013/05/13/Highest-Paid-Public-Em...

Wed, 05/21/2014 - 19:58 | 4783192 ACP
ACP's picture

All these school employees all seem to be "well-endowed".

Maybe they're compensating?

Wed, 05/21/2014 - 20:50 | 4783314 NoDebt
NoDebt's picture

I sure hope those investment managers took their compensation as "carried interest" so they could pay based on long term capital gains rates (even though their capital was never at risk).  It would almost be a shame if they didn't.  You'd never find another investment manager to do that kind of work for such paltry pay without a generous tax break.  

"Taxes are for the little people."  - The Queen of Mean

Wed, 05/21/2014 - 21:53 | 4783493 Handful of Dust
Handful of Dust's picture
Texas to pay $9.375 million for [football coach] Charlie Strong in 2014

 

The University of Texas' new football coach, Charlie Strong, will be paid $5 million for the 2014 season and the university will pay Strong's $4.375 million buyout to Louisville, according to financial terms approved Monday by the university system's board of regents.

 

http://www.usatoday.com/story/sports/ncaaf/2014/01/13/charlie-strong-con...

 

It's all a matter of priorities ....

Wed, 05/21/2014 - 19:45 | 4783159 i_call_you_my_base
i_call_you_my_base's picture

and use of lower-paid adjunct faculty.

To me the real irony is here, in that they bring in cheap labor, pay them nothing, and don't give them bare benefits like healthcare. They even fight collective bargaining by the adjuncts.

Wed, 05/21/2014 - 19:30 | 4783119 McMolotov
McMolotov's picture

"It's easy to whack these guys... it looks big in percentage terms, but it’s a basis point or two compared to the endowment."

Dude's a walking that's-what-she-said joke.

Wed, 05/21/2014 - 19:52 | 4783175 disabledvet
disabledvet's picture

Everyone is a market timer. Move along...

Wed, 05/21/2014 - 19:43 | 4783151 NeedleDickTheBu...
NeedleDickTheBugFucker's picture

Given all the atrocious economic ideas that have emanated out of the hallowed halls of Princeton University over the years, it's quite logical that they would pay $9.2 million in compensation for a leveraged beta strategy that failed to meet the benchmark.

Wed, 05/21/2014 - 19:43 | 4783153 ebworthen
ebworthen's picture

Gee, wonder why tuition is so high?

It must be all the money they pay those grad. student instructors and janitors.

Wed, 05/21/2014 - 23:57 | 4783786 CaptainNemo
CaptainNemo's picture

It is all nothing more than a silly scheme to steal money from us....just like this thing that we call economy does 

Wed, 05/21/2014 - 19:48 | 4783169 nmewn
nmewn's picture

"...the company known as Princo that manages the school’s $18.2 billion endowment..."

Just one Ivy League School.

"I mean, I do think at a certain point you’ve made enough money." Obama

Really? ;-)

Wed, 05/21/2014 - 21:30 | 4783423 MilwaukeeMark
MilwaukeeMark's picture

A million dollars doesn't seem at all high to me. It takes special skills to get adolescents and their parents to mortgage their entire future in exchange for their brains being pumped full of useless Marxist propaganda. You try it.

Wed, 05/21/2014 - 22:48 | 4783648 Obamanation
Obamanation's picture

It's articles like these that sometimes make me scratch my head about ZH.  For a fund of that kind of size with that type of YoY return, those salaries are comparable to any private fund.  So if anything it looks like they were underpaid previously.  If endowments and SWF's want to maintain competitiveness in the fund management business, public or private, they need to pay free mkt rates which is what I thought ZH was all about.  

Wed, 05/21/2014 - 23:16 | 4783705 SmackDaddy
SmackDaddy's picture

or you could look at it this way.... any pay is too much for these worthless pieces of shit doing make believe work in a fantasy illusion. 

Wed, 05/21/2014 - 23:40 | 4783760 Obamanation
Obamanation's picture

Yeah let's just group all ppl in finance collectively into your category of worthless p.o.s.'s.  Make believe to who exactly?  To your ilk who like to take extreme positions and paint everyone in an industry you don't respect as evil?  

Thu, 05/22/2014 - 02:38 | 4783970 The Wedge
The Wedge's picture

You're just not going to get through to some here. Sadly, many here believe because person a makes x amount, somehow it takes away from person b as though there is a fixed amount of money. They also like to lump everyone on wall street together as you pointed out. They often call for and hope the system will crash. I often wonder if they realize how many people that would hurt having their life savings and retirements wiped out. I also wonder if they realize when countries, especially large ones, collapse they get new governments and historically this has not been a positive for the people. I suppose they don't actually have any skin in the game.

And the term "income inequality" is a misnomer. There is no such thing as income equality. Never has and never will. The day we have income equality is the day we are all slaves. Even then some animals will be more equal than others. Truth is many believe in a fatalistic point of view that the man prevents them from the life they feel they deserve. They're already mentally enslaved. But the bonds can be easily broken. As Marley sang, 'none but ourselves can free our minds'. There will always be obstacles and despite this people overcome them every day. Wow, I've channeled Huxley, Friedman and now Bob Marley. But I digress. Many who feel this way do so not without merit. There is absolute corruption that emanates from Washington spreading in all directions public and private. I call them criminal gangs. So there's no question roadblocks are thrown up unfairly that make it harder for the average person. But the center of the crime syndicate is Washington, not wall street or corporations or some guy who makes more money than you. Real power comes from the ability to tax, sign unfair trade agreements and make war not wall street or a companies ability to pay politicians for favor or whatever. These are underlings in the gang.

The head of the snake is in Washington. When you start talking income inequality the presumption is some entity, like Government, can somehow make everything equal. Or the reason for inequality is because someone else makes more than you. That is absurd. The best they can do is govern in a responsible manner keeping the playing field level as possible. Of course they do not do this. So thinking anyone other than yourself can make things equal is the height of absurdity.

Thu, 05/22/2014 - 22:02 | 4787193 MontgomeryScott
MontgomeryScott's picture

Yo, 'bama:

'INDUSTRY' is defined as follows:

1. Commercial production and sale of goods.

2. A specific branch of manufacture and trade.

3. The sector of an economy made up of manufacturing enterprises.

NOW, when you want to talk about brainwashing the younger generation and call it an 'industry', it seems that you need to refine your use of language.

That IS, UNLESS, you consider those who have been taught WHAT to think and put on the endless taxpayer treadmill as 'GOODS' (OR, 'creating' fake money out of thin air and charging interest in REAL terms to use it, and profiting from it).

You FUCK.

Mon, 05/26/2014 - 03:34 | 4794833 Obamanation
Obamanation's picture

So according to your dipsh*t definition of industry, roughly 80% of Americans who are in a service oriented business are worthless?  Got it.  

Thu, 05/22/2014 - 07:22 | 4784134 esum
esum's picture

funny how the ivy league has cultivated a bunch of commies with scholarships no less... capitalism is  feeding the libtards who want to take it down... amazingly stupid... beyond schools look at rockefeller, carnegie, ford foundations and the flaming commies who run them... however is is genius to get people to willingly surrender freedom and individuality while borrowing and paying to get indoctrinated..and burying themselves in unmanageable debt... bravo... 

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