I am referring, of course, to the sad fortunes of Harvard University’s endowment, which I have blogged on a number of occasions.

Well, Felix Salmon notes that , something which I noted in December, though, to be fair, I never thought that it would get to this point, he said, quoting Mr. Salmon:

Richard Bradley reports:

Harvard has already halted the hiring of junior faculty and announced an early retirement program for tenured professors, and for the first time ever is considering laying off tenured professors.

And why might Harvard be laying off tenured professors? Because it’s down to its last $25 billion, of course. Bradley adds a bit to what we know about Harvard’s financial mismanagement:

According to the university’s 2008 financial report, in the next 10 years it must pay various private investors some $11 billion in capital commitments. Where will that money come from if, as seems likely, endowment growth over those years is minimal or nonexistent, and alumni’s own strained budgets limit their generosity?

So, the question here is where Harvard will go with all of this.

Obviously, hitting up alumni for more money is a given. That’s what they do normally.

The real question is whether they will either move to a less aggressive, and less risky strategy, which will provide lower, but more stable, returns and greater liquidity, or whether they will go whole hog into more private equity deals, betting on a rebound which will lift them out of their problem?

Human nature being what it is, I’m going to guess that they go with the latter, because doubling down on failure is basic human nature.

^*Yes, I spent a lot of time on this title, and get your mind out of the gutter!