African Money Laundering

During the werewolf's travels throughout Africa, Zambia specifically, he recalls getting his hands on some local currency, the Kwacha, that was so filthy, a haz-mat suit would have be advisable in handling it. The notes were so odious, greasy, yucky, and sticky, the werewolf wondering if they had been deposited in someones rectum at some-point. The gooey residue that seemed to coat each note managed to contaminate the werewolf's old travel wallet, rendering it useless. The filth has spread from local currency to international bills it seems. Anyhow, a friend sent the werewolf this update from AP on the need sanitize currency in Zimbabwe.

"Some have become almost too smelly to handle, so Zimbabweans have taken to putting their $1 bills through the spin cycle and hanging them up to dry with clothes pins alongside sheets and items of clothing.

It's the best solution — apart from rubber gloves or disinfectant wipes — in a continent where the U.S. dollar has long been the currency of choice and where the lifespan of a dollar far exceeds what the U.S. Federal Reserve intends."

This takes the meaning of dirty money to a whole new level.

Higher education's crashing endowments.

According to Business Insider, here are the ten worst performing higher education endowments.

1. Harvard, down 30% and $10.9 billion.
2. Yale, down 29% and $6.5 billion.
3. Duke, down 28% and $1.7 billion.
4. Brown, down 27% and $730 million.
5. Syracuse, down 33% and $327 million.
6. University of Minnesota, down 27% and $312 million.
7. Cornell, down 26% and $1.4 billion.
8. University of Southern California, down 26% and $918 million.
9. California Institute of Technology, down 26% and $483 million.
10. Grinnell, down 27% and $396 million.

Wow. The total loss for the above endowments is about $23.67 billion. (this is just sample of a population of over 800 endowments) That is some serious cheddar. Some of the most "elite" schools in the country are represented on this list. One would think with portfolios the size of a small country's GDPs that risk management and hedging would be a core strategic component of endowment management. Guess not. What will be interesting is measuring the long term costs of these staggering losses to the reputations, quality, moral, and perceptions of the aforementioned schools and other top losers. Endowments were a huge value add to differentiating these institutions in the marketplace. They underwrote specialized faculty members who added prestige, exotic resources, important research, unique facilities, and scholarships among other things. When these dry up, what happens?

From a consumer perspective, tuitions will definitely increase at all of these schools due to acute operating budget shortfalls. (They'll increase everywhere) Due to systemic failures, there are few, if any, white knight philanthropists able to bridge the budget gaps of this magnitude. Value will get harder to define. Much like the collapse of the storied and allegedly invincible investment banking houses last year, is higher education slowly entering a new era in terms of how universities are perceived and managed? Will the titans fall? Given that the squeeze is near universal, it's hard to gauge who will win and who will lose. The werewolf still hasn't gotten his paws around the implications of these imploding endowments. Considering they took generations to build, most of them will likely never regain what they've lost from a balance sheet perspective. Once the balance sheet goes south, it's open season. It should be interesting to watch how this all plays out.

Here is the methodolgy:
24/7 Wall St. has analyzed the data for all 842 institutions and made comparisons based on 1) absolute dollar gain and loss, 2) percentage gain and loss, 3) greatest percent and absolute dollar gains and losses at the largest endowments (those with over $1 billion under management) with a special focus on those that lost 5% more than the average endowment in the survey or 23.7%, and 4) colleges and universities with endowments of more than $300 million which outperformed the average endowment loss of 18.7% by 5%–that is, those which had percentage losses of 13.7% or less.
Based on this analysis, 24/7 Wall St. picked the 20 worst managed university and college endowments and the 17 best. There were not enough colleges and universities to make a list of the 20 best based on our criteria. 24/7 also picked a “best of class” of endowments of more than $100 million which had absolute percentage gains over the one year period. Only 33 endowments of any size in this group of 842 had positive gains.

The price of "Hope and Change."

Remember how all of that buzz about hope and change circulated with typhoon like force back in 2008/2009? For a man who pledged to usher in a new era in American governance, publicly bemoans the corrupting influence of money in politics, and publicly attacks the Supreme Court; President Obama seems very invested in pay-for-play politics of yore. The Daily Caller paints an interesting picture of how money has influenced Obama's appointments here. Although it's not illegal and is a previously accepted practice to appoint loyal fundraisers, it is certainly in the stratosphere of lying and hypocrisy given where the president's rhetoric has been on these issues. Even by modern political standards, this is tacky and disingenuous. The werewolf doesn't object to politicians rewarding their loyal bundlers and fundraisers for doing their job. He objects to them branding themselves dishonestly and thinking they can get away with it unnoticed in this day and age. It's very patronizing and disrespectful. This voters and taxpayers of this country owe to themselves to start insisting that politicians put their money where their mouth is!

From the previously cited Daily Caller article, here is the menu of  key positions sold to political hacks in the Obama administration: 

The Big Changers’ Club ($500,000+)
Avant, Nicole (Los Angeles, CA)
Position: Ambassador to the Bahamas
Barzun, Matthew (Louisville, KY)
Position: Ambassador to Sweden
Beyer, Don (Alexandria, VA)
Position: Nominated to Ambassador to Switzerland and Liechtenstein
Bleich, Jeff (Piedmont, CA)
Position: Ambassador to Australia
Danzig, Richard (Washington, DC)
Position: Member, Defense Policy Board
Donahoe, Eileen Chamberlain (Washington, DC)
Position: Nominated to Ambassador to UN Human Rights Council
Eacho, William (Bethesda, MD)
Position: Ambassador to Austria
Forester, Christine (San Diego, CA)
Position: Member, Presidential Committee on the Arts and Humanities
Genachowski, Julius (Washington, DC)
Position: FCC Chairman
Gips, Don (Boulder, CO)
Position: Ambassador to South Africa
Gutman, Howard (Washington, DC)
Position: Ambassador to Belgium
Harris, Scott (Washington, DC)
Position: General Counsel, Department of Energy
Katz, Allan (Tallahassee, FL)
Position: Nominated to Ambassador to Portugal
Kennard, William (Washington, DC)
Position: Ambassador to the European Union
Oreck, Bruce (Boulder, CO)
Position: Nominated to Ambassador to Finland
Overton, Spencer (Chevy Chase, MD)
Position: Principal Deputy Assistant Attorney General in the Office of Legal Policy
Perrelli, Tom (Arlington, VA)
Position: Assistant Attorney General
Rivkin, Charlie (Los Angeles, CA)
Position: Ambassador to France and Monaco
Roos, John (Hillsborough, CA)
Position: Ambassador to Japan
Sanchez, Frank (Tampa, FL)
Position: Undersecretary of International Trade
Solomont, Alan (Boston, MA)
Position: Ambassador to Spain
Spinner, Steve (Menlo Park, CA)
Position: Loan Programs Advisor, Department of Energy
Stroum, Cynthia (Seattle, WA)
Position: Ambassador to Luxembourg

West, Tony (Oakland, CA)
Position: Assistant Attorney General, Civil Division