Podcast Summary
College Endowments: A Significant Source of Funding for Elite Universities: Elite universities have substantial financial resources due to large endowments, enabling them to provide extensive support for students and academic programs.
College endowments, particularly at elite universities, play a significant role in funding higher education operations. The largest endowments, such as those at Harvard, Yale, and Princeton, have grown tremendously over the years, with assets totaling nearly $1 trillion. Universities withdraw approximately 5% of their endowment each year to support their operations, resulting in substantial resources for these institutions. For instance, Princeton University, which had an endowment valued at over $100,000 per student in 2021, spent less than $10,000 per student in the 1970s. This shift in funding sources has led to substantial financial resources for these universities, enabling them to provide extensive support for their students and academic programs.
University Endowments and Secretive Investments: Universities invest in private equity and hedge funds, but secrecy makes it hard to know where money is going. Some universities struggle to divest from defense and Israel, but can opt for transparent, ESG-screened funds.
The endowments of wealthy universities, particularly those at the top tier, have grown significantly over the last few decades due to high returns from investments in private equity and hedge funds. These investments are often kept secretive, making it challenging for students and the public to know where their money is being put. Universities, especially private ones, face difficulties in divesting from industries like defense and Israel due to the secrecy surrounding these investments and the focus on maximizing returns. However, there are options for universities to invest in more transparent, passively managed funds that screen out defense contractors and weapons manufacturers based on environmental, social, and governance criteria. Ultimately, the challenge lies in universities defining their values and applying them to investment decisions.
Universities aligning investments with principles: Universities can ethically grow endowments by prioritizing values and reaching consensus on their application to investments, as demonstrated by UC system's successful fossil fuel divestment.
Ethical and values-based investing is a viable option for individuals and institutions, including universities, to grow their endowments while aligning their investments with their principles. The University of California system, for instance, successfully divested from fossil fuels and continues to maintain a healthy endowment. However, the challenge lies in deciding which values to prioritize and reaching a consensus on their application to specific issues. While there was a level of agreement on climate change before divestment policies were implemented, achieving such consensus on complex and contentious issues like the Israeli-Palestinian conflict may be more difficult. Nevertheless, universities should engage in thoughtful reflection on their values and how they apply to their endowment investments, as they increasingly connect institutions to global economic issues.
Students pushing universities to take action against racism and discrimination: Universities face pressure from students to address racism and discrimination, driven by activism and a polarized climate, with politicians amplifying extreme rhetoric and endowment funds intersecting with education as key issues.
Universities are facing increased pressure from students to take proactive steps against racism and discrimination, much like corporations did during the Black Lives Matter movement. This trend is being driven by students who have grown up in an era of activism and demand more from institutions. While there is a rich history of student protests on campuses, the current climate is more polarized and fearful than in the past, with politicians inserting themselves into the situation and amplifying extreme rhetoric. The management of endowment funds and the intersection of money and education are also key issues in this context. It will be interesting to see how universities respond to these challenges and how students continue to push for change, both on campus and off.
Young workers' decisions influenced by social and political issues: Up to half of younger workers would not consider living in a state banning abortion, highlighting the importance of businesses staying attuned to social and cultural shifts to attract and retain talent
Young people's decisions about where to live and work are increasingly influenced by social and political issues, such as access to reproductive rights and LGBTQ protections. This was highlighted in a CNBC survey, which found that up to half of younger workers would not consider living in a state that bans abortion. The implications of this trend are significant for businesses, as more than 20 states have restricted or banned abortion access in the past two years. Additionally, Gen Z is carrying more credit card debt than previous generations did at the same stage in life, according to a report in The Wall Street Journal. These findings underscore the importance of companies staying attuned to social and cultural shifts and adapting their policies and practices accordingly to attract and retain talent.
Gen Z carrying more debt with savvier management: Gen Z deals with higher debt and inflation, but manages it better through lifestyle adjustments
Young adults today, specifically those in the Gen Z age group, are carrying more debt and higher average balances on their credit cards compared to a decade ago. This is due to factors like inflation in food, housing, and student loan debt, along with stagnant wage growth. Despite this, Gen Z seems to be more savvy when it comes to managing their debt, as they're more likely to use credit cards to live their best life but then adjust their lifestyle at home to afford their expenses. This is a shift from previous generations, as young adults in the past might have struggled more with managing their debt and its long-term consequences. The current economic climate, with higher prices and dwindling savings, is forcing people to reevaluate their spending habits and adjust to the new reality.
Open conversations about menstruation impacting menopause discussions: Gen Z's openness about menstruation influences adults to discuss menopause, leading to greater education and awareness.
The open conversations about menstruation among younger generations are influencing adults to destigmatize and openly discuss menstrual experiences and health issues, including menopause. Erin, a Gen X mother, shared her personal experience of feeling more comfortable discussing menstrual pain at work due to her daughter's generation's openness about the topic. Additionally, the lack of open dialogue and understanding about menopause in the past has resulted in a greater need for education and awareness. The sad news of Kimberly's cat Jasper's passing was also shared, with listeners expressing their condolences. In the spirit of Mother's Day, Mallory Lewis, the puppeteer and children's entertainer who performs with her mother Sherry Lewis's character Lamb Chop, shared that she used to believe her mother wasn't always right but has come to realize that she was. This realization is a reminder of the importance of appreciating the wisdom and experiences of those around us.
Productivity and having children: Not having children can impact productivity levels, but both having and not having children require hard work and unique challenges.
Productivity and getting things done can be influenced by various factors, including having children or not. Amy and Kimberly, hosts of the Make Me Smart podcast, had a conversation about their different productivity levels, with Kimberly explaining that not having children is a significant factor. They both acknowledged their hard work, but appreciated the unique challenges each other faces. The podcast also mentioned the ongoing criminal trial of former President Donald Trump and the fines he's accumulating for breaking gag orders. In the upcoming newsletter, they plan to explore the effectiveness and fairness of fines as a deterrent for rule-breakers. Additionally, Rima Jerez, host of This Is Uncomfortable, encouraged listeners to join her podcast's summer book club, which offers recommendations on books that challenge perspectives on money, class, and work, along with interviews and giveaways.
