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A comment on Cash-Strapped State Schools Being Forced to Privatize.

Re: Cash-Strapped State Schools Being Forced to Privatize by mhb on Thursday April 23, 2009 @02:11PM (#576186)
The article says that a $16 billion endowment is needed to replace the state's annual contribution of $327 million. Obviously no one know what a reasonable return on an endowment will be in the future, but you would like to think that 2% is overly pessimistic.

If they assume a 5% return, the endowment needed is $6.5 billion.

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Re: Cash-Strapped State Schools Being Forced to Privatize by gambling8nt on Thursday April 23, 2009 @03:22PM (#576309)
You're not considering that they also need to grow the endowment to keep up with inflation; their estimate seems to indicate an expected return of 2% over inflation--a more reasonable projection for long term conservative investment.
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Re: Cash-Strapped State Schools Being Forced to Privatize by mhb on Friday April 24, 2009 @09:03AM (#577414)
OK. Thanks.
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