Friday Assorted Links

1. At virtual Family Chapel, the ‘spiritual but not religious’ find community during pandemic. Eldest is featured, making me even more famous.

2. Why Trump Was Deaf To All The Warnings He Received. Incuriosity and paranoia.

3. Colleges could lose up to 20 percent of students.

“Ten percent of college-bound seniors who had planned to enroll at a four-year college before the COVID-19 outbreak have already made alternative plans. Fourteen percent of college students said they were unlikely to return to their current college or university in the fall, or it was “too soon to tell.” Exactly three weeks later, in mid-April, that figure had gone up to 26 percent. Gap years may be gaining in popularity. While hard to track, there are estimates that 3 percent of freshmen take a gap year. Since the pandemic, internet searches for gap years have skyrocketed. College students do not like the online education they have been receiving. To finish their degrees, 85 percent want to go back to campus, but 15 percent want to finish online.”

4. The Grumpy Economist on University finances, particularly endowments. Sign of the seriousness of things, belt tightening ahead even for the uber wealthy.

“University endowment practices are quite a puzzle. . . . Why are they invested in obscure, illiquid, hard to value, assets, with at least two layers of high fees (university management + asset managers) rather than, say, have one part-time employee and put the whole business into Vanguard total market for about 10 basis points? Why do they leverage with short-term municipal debt which must be rolled over at the most inconvenient times? Why do university presidents seem to glory in great endowment returns in good times, but these occasional liquidity crunches are seen simply as acts of nature, not preventable with a nice pile of liquid assets? Why do donors put up with this — why do donors give money that will be managed in obscure high fee investments, rather than demand low-fee transparent investment, or even set up separate trusts, transparently managed, to benefit their alma maters?”

A flurry of great questions. The short answer to the first question I suspect is because investment managers’ think they’re smart enough to pick stock winners when history suggests otherwise.

An addendum suggests I’ve nailed it:

“Where are the trustees? Well, I speculated to one correspondent, there is a natural selection bias. How do you get to be a university trustee? 1) Make a ton of money as a (lucky) active asset manager, especially on trades and investments that come from college contacts;  2) Collect a lot of fees;  3) Persuade yourself how smart you are and how easy the alpha game is 4) Desire to socialize with the people who run universities. This is hardly likely to produce contrarians, fans of scientifically validated, quantitative, low-fee investment strategies.”

5. The Real Story Behind That Viral Photo of President Johnson During the Vietnam War. In praise of thoroughness and media literacy.

“. . . President Johnson wasn’t crying over thousands of dead American soldiers in the photo. Johnson is actually listening to an audio tape that was created by Captain Charles “Chuck” Robb, his son-in-law. That detail would allow the casual viewer to assume that LBJ was distressed to hear the recording, but it seems that so many of the documentary filmmakers who use this image haven’t bothered to look at the other photos taken during that same time in the White House.”