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Stanford Getting Rid of $18 Billion Endowment of Coal Stock

Soulskill posted about 2 months ago | from the unconflicting-itself-of-interests dept.

Education 208

mdsolar sends this report from the NY Times: "Stanford University announced Tuesday that it would divest its $18.7 billion endowment of stock in coal-mining companies, becoming the first major university to lend support to a nationwide campaign to purge endowments and pension funds of fossil fuel investments. The university said it acted in accordance with internal guidelines that allow its trustees to consider whether 'corporate policies or practices create substantial social injury' when choosing investments. Coal's status as a major source of carbon pollution linked to climate change persuaded the trustees to remove companies 'whose principal business is coal' from their investment portfolio, the university said."

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208 comments

Activist investors (5, Insightful)

EmagGeek (574360) | about 2 months ago | (#46943687)

They are not acting in the best interest of those the endowments are there to serve. They are using the financial clout of the endowments to make a political statement, often to the detriment of the endowment's beneficiaries.

Stupid.

Re:Activist investors (4, Insightful)

Travis Mansbridge (830557) | about 2 months ago | (#46943729)

It would seem they simply consider the environmental detriment more significant than the economic detriment.

Re:Activist investors (1)

Anonymous Coward | about 2 months ago | (#46943807)

Which would be fine, if they actually prevented any environmental detriment. But if they sold the shares, then someone else bought them, so for the Coal companies it all comes out in a wash.

Re:Activist investors (4, Informative)

afidel (530433) | about 2 months ago | (#46943869)

Companies only get money from stock when they offer new shares (or sell those already in company reserves), by refusing to buy shares in these types of companies they are reducing the value of future offerings by becoming one less bidder for those shares.

Summary is WRONG (5, Informative)

ShanghaiBill (739463) | about 2 months ago | (#46943965)

they are reducing the value of future offerings by becoming one less bidder for those shares.

Not by much, because the summary is WRONG. $18B is the value of their entire endowment. The fraction of that specifically invested in coal is a tiny fraction of that. If they are smart, they already divested, before making the announcement.

Re:Summary is WRONG (3, Insightful)

K. S. Kyosuke (729550) | about 2 months ago | (#46944097)

Not just the summary, the article's title is misleading as well. And here I was almost thinking here that just Stanford's coal stock is half of my country's annual state budget!

Re:Summary is WRONG (-1)

Anonymous Coward | about 2 months ago | (#46944599)

K. S. Kyosuke ya bigmouth: Yer bein called out (why ya runnin "forrest"?) http://slashdot.org/comments.p... [slashdot.org]

Re:Summary is WRONG (1)

geekoid (135745) | about 2 months ago | (#46944211)

Smart? well that depends on their goal.

Re:Activist investors (4, Insightful)

Anonymous Coward | about 2 months ago | (#46944601)

No, they aren't. If you auction off a commodity, I don't lower the sale value by not bidding. The sale value will be whatever the economic usefulness of the item dictates, so long as there are enough willing buyers to soak up the entire supply. To put it another way: the value of coal stock is a feature of the value of coal. Complete divestiture by everyone on the planet wouldn't even kill those companies - in fact they'd be able to buy all their own stock back for a pittance! The only thing that will kill the companies is refusing to buy their *product*. Stanford should rather have calculated their profits from these investments and used that money to divest themselves of their use of coal.

Re:Activist investors (1)

Penguinisto (415985) | about 2 months ago | (#46943899)

Stanford can afford to do it. Most of the lesser-known colleges cannot.

Either way, I wonder where they will put the money. After all, almost any actually profitable stock out there is connected to a company that in some form or another is considered 'evil' in the eyes of some activist organization, so what's to stop some activist group form using this as a precedent?

Re:Activist investors (1)

mysidia (191772) | about 2 months ago | (#46943999)

Either way, I wonder where they will put the money.

In other news... the FBI just sold off $18 out of 25 billion worth of Bitcoins from Silk road, and MIT is giving out $100 in Bitcoins to students.

What do you think Stanford spent the $$$ on? :)

Re:Activist investors (4, Insightful)

ShanghaiBill (739463) | about 2 months ago | (#46944005)

so what's to stop some activist group form using this as a precedent?

The fact that the endowment managers can pick and choose which activists they pay attention to. They didn't divest from coal because of a few whining activists. They divested because of broad support among students and faculty for the divestiture. It is also likely that they looked at coal mining companies, and decided that they weren't a very good investment in the first place. Coal mining may not be a good long term growth industry.

To the Contrary. The last ones out get burned. (5, Insightful)

turkeyfish (950384) | about 2 months ago | (#46944037)

To the contrary, Stanford is simply astute enough to be the first to sell, while the price of companies involved in coal are still high. Its now just a trickle, but soon it will be a flood. The smart ones always get out first. The rest won't be able to afford not to and will begin to sell as their portfolios in these companies as they decrease in value. With new solar technologies capable of energy capture at up to 70% likely to start hitting the market within 5 years and wind energy becoming cheaper and cheaper and the electric car industry just around the corner, fossil fuel dinosaurs will be returning once again to the depths. Only those locked in will ride coal and ultimately fossil fuels all the way to the bottom.

The energy barons of the future will be those that invested in renewables first. Its inevitable and of course, the reason that China is now spending 3 times more on solar ($147 billion in 2011) than the US ($52 billion in 2011). No one can say the Chinese don't know how to grow their economy, which will be the world's largest this year, if it isn't already.

Re:To the Contrary. The last ones out get burned. (1)

K. S. Kyosuke (729550) | about 2 months ago | (#46944107)

Of course, the Chinese also have a lot of interest in getting the pollution out of the air around Shanghai and other cities.

Re:To the Contrary. The last ones out get burned. (-1)

Anonymous Coward | about 2 months ago | (#46944603)

K. S. Kyosuke ya bigmouth: Yer bein called out (why ya runnin "forrest"?) http://slashdot.org/comments.p... [slashdot.org]

Re:Activist investors (4, Informative)

CRCulver (715279) | about 2 months ago | (#46943737)

Harvard divested from tobacco investments over two decades ago and, in retrospect, pretty much everyone agrees it was a good thing. In any event, activists can only push universities to consider their investments. If the university is sitting on a massive endowment and it can easily weather the divestment, then the activists will have their way, but if it were to pose a serious threat to the university, then I think such calls would face great resistance.

In retrospect... (1)

swb (14022) | about 2 months ago | (#46943797)

In retrospect, everything that worked out looks pretty smart, doesn't it?

Everything that didn't work out? Nobody talks about it.

Re:In retrospect... (0)

Anonymous Coward | about 2 months ago | (#46944497)

You have freedom in USA to invest or divest in Coal!

Re:Activist investors (2)

Shakrai (717556) | about 2 months ago | (#46943743)

It's a prestigious University. They'll just jack tuition and fees. What, are you gonna go somewhere else? Okay. We've got a waiting list ten miles long.

You're right of course, but that's basically what their attitude is. I highly doubt they'll go broke over this or any other activist investment decision.

Re:Activist investors (1)

DirePickle (796986) | about 2 months ago | (#46944415)

They're voting with their wallet, as the Randians so often demand. What's the big deal?

Re:Activist investors (3, Informative)

pixelpusher220 (529617) | about 2 months ago | (#46943745)

I'll wager it is in the interest of the 'shareholders'. As in coal may not be the best 'growth' industry in the coming years.

That said, the only way to be 'whole' with what they are saying is 'reducing' their endowment by 18 billion dollars. I.e. donate the stock and give it away. If they simply sell it, then they still have the benefit of having been given it. One might call it laundered money from a social conscience point of view.

Re:Activist investors (1)

kruach aum (1934852) | about 2 months ago | (#46943755)

Money can't buy you lungs that convert CO2 to oxygen, so I would say they are in fact acting in the best interests of their beneficiaries.

Re:Activist investors (1)

Shakrai (717556) | about 2 months ago | (#46943787)

Money can't buy you lungs that convert CO2 to oxygen

If only nature had figured out this problem [wikipedia.org] a few billion years ago.

Re:Activist investors (0)

pixelpusher220 (529617) | about 2 months ago | (#46943825)

whatever you say tree-boy

Re:Activist investors (1)

geekoid (135745) | about 2 months ago | (#46944237)

Considering plants are carbon neutral, I'm not sure what you point is.

Re:Activist investors (0)

Anonymous Coward | about 2 months ago | (#46943845)

Money can't buy you lungs that convert CO2 to oxygen, so I would say they are in fact acting in the best interests of their beneficiaries.

Go out an plant a tree. Green washing with carbon credits and other nonsense will do jack squat to benefit the environment. If you want to help the environment, plant a tree.

Re:Activist investors (1)

Capt.DrumkenBum (1173011) | about 2 months ago | (#46943975)

Money can't buy you lungs that convert CO2 to oxygen

No, but I bet I could buy a shitload of trees with $18B and trees are pretty good at converting CO2 in O2

Re:Activist investors (1)

geekoid (135745) | about 2 months ago | (#46944369)

Lets look at some numbers:
the Kielder Forest has 150 million trees that temporarily hold 89 thousand tons per year.
We emit an EXTRA 29 gigatonnes per.
so that mean we need to build 326,000 kielder forest, or 48,876,404,494,382 trees.
And that's just to stay even, with today's emissions.
Suddenly 18 billion looks like chump change.

Don't get me wrong., I like forests, and would like to see more of them. I'd also like to see an aggressive rain forest restoration program.

Re: Activist investors (1)

Capt.DrumkenBum (1173011) | about 2 months ago | (#46944485)

Sense of humour fail.

Re:Activist investors (0)

Anonymous Coward | about 2 months ago | (#46943757)

Imagine: A pedophile gives you lots and lots of money to invest. You invest the money, among other things, in anti-pedophilia organizations. Why are you acting against the best interests of the pedophile????//?/? Why? Why? Why? Why? Why?

Stupid.

Re:Activist investors (1)

TsuruchiBrian (2731979) | about 2 months ago | (#46943895)

I am not sure why helping to reduce carbon emissions and pollution counts as a political statement. Maybe investing in science is a political statement too because so many Republicans believe in the bible as the ultimate source of truth.

Re:Activist investors (1)

DiamondGeezer (872237) | about 2 months ago | (#46944085)

Refusing to invest in coal industries does not help reduce carbon emissions and pollution one jot. If there's ever a polluting industry it would be the so-called renewables which use rare earths and cause massive pollution.

Re:Activist investors (1)

geekoid (135745) | about 2 months ago | (#46944383)

"which use rare earths and cause massive pollution."
not compared to coal. Coal is far, far worse.

Re:Activist investors (1)

TsuruchiBrian (2731979) | about 2 months ago | (#46944505)

Refusing to invest in coal industries does not help reduce carbon emissions and pollution one jot.

Do you not believe that investment drives use?

If there's ever a polluting industry it would be the so-called renewables which use rare earths and cause massive pollution.

I didn't mention anything about renewables, but I will agree that solar does in fact generate a lot of pollution, wind not so much. The pollution from coal is on a level orders of magnitude higher than any renewables. It even causes more radioactive waste than nuclear does. Coal is by far the dirtiest form of energy we have.

Re:Activist investors (3, Insightful)

KeensMustard (655606) | about 2 months ago | (#46944021)

Fossil fuel industries are the buggy whip manufacturers of our age. In the medium term it makes sense to divest, they don't have a future beyond supporting plastics manufacture and fuels for specialised fields (e.g. manufacturing fuel for aircraft, rather than mining it). So, even supposing their financial obligations should override their ethical obligations (which they don't) there isn't even a financial argument to do so.

Re:Activist investors (1)

JanneM (7445) | about 2 months ago | (#46944055)

The endowment is there to serve the university. And the university is plenty sensitive to its public perception; that affects both enrollment as well as donations. It's not a stretch to say that a fairly large proportion of both current and former students and faculty view global warming as a threat and coal as a bad choice for producing power.

Making these people happy is vital for the universitys bottom line - not to mention that "the university" consists of people that themselves share many of these values. So yes, they are acting in the best interest of those the endowments are there to serve.

Re:Activist investors (1)

gtall (79522) | about 2 months ago | (#46944163)

Well, as fracking and the gas industry is starting to eat coal's bread and butter, i.e., the power plants (no one is planning new coal power plants in the U.S., they are all gas), it was probably a good financial move spun to feed the Stanford rank and file as a eco-conscious decision to save the planet blah blah blah.

It is good for the environment to have coal take it in the neck, but I'd rather the U.S. go back to nuclear. It is also bad for the coal states and the coal workers.

Re:Activist investors (1)

geekoid (135745) | about 2 months ago | (#46944397)

I would also stop permitting the sale of coal mined on public lands to be sold outside our borders.
his will drive up the cost in other countries which would lend themselves to cleaner fuels.

Re:Activist investors (0)

Anonymous Coward | about 2 months ago | (#46944313)

Not much of a libertarian, are you. This is what free people and institutions do -- express themselves. Some will do so in ways you like, some not. Many are willing to pay for expression. Rich people and institutions get more attention when they do so because the greater amounts involved make more of a splash. Enjoy the display of liberty.

Re:Activist investors (1)

dirk (87083) | about 2 months ago | (#46944317)

Only if you believe their only purpose to to make money. Schools are not corporations in that they have other interests besides making money. There is something called contentious investing where you only invest in businesses and industries you believe are worth investing in. You may give up a little money by not investing in coal companies or tobacco companies or for profit prisons or whatever industry you feel isn't worth your money, but you gain a small amount of leverage by taking money away from those industries.

Sometimes morals are more important than money.

Re:Activist investors (0)

Anonymous Coward | about 2 months ago | (#46944375)

For whom it may concern,

  investers we need you

the,
The Coal Industry
Uncle Sam [you-are-the-movement.com]

Re:Activist investors (0)

Anonymous Coward | about 2 months ago | (#46944423)

Stanford has more than enough money to burn. They got over a billion $ of donations just last year. Don't cry for this endowment's beneficiaries.

Re:Activist investors (1)

radl33t (900691) | about 2 months ago | (#46944513)

it is increasingly likely that renewable energy returns will be significantly greater while offering less risk in the future compared to coal. Coal's future is mired in health and environmental problems that will be addressed (in some uncertain way) by the public and government. New coal generation is no longer economically competitive compared to alternatives. Private capital has been quietly making this shift from traditional energy companies into renewable energy for some time now at an overall scale much larger than Stanford's investments.

Re:Activist investors (3, Insightful)

NoKaOi (1415755) | about 2 months ago | (#46944611)

They are not acting in the short term interest of those the endowments are there to serve. They are using the financial clout of the endowments to make a political statement, often to the detriment of the endowment's beneficiaries.

FTFY. They are allowed to divest of companies that will create substantial social injury. Being a major contributor to global warming will indeed to significant social (among other types) injury. Such harm will indeed do harm to the endowment's beneficiaries in the long term. Therefore, they are acting in the long term interest of the beneficiaries (and their children, and their children's children, and their children's children's children...etc).

maybe it is time (0, Funny)

Anonymous Coward | about 2 months ago | (#46943695)

maybe it is time for a digital, decentralized, cryptofuel.

like dogecoal, bitcoal, or cleancoal?

So burn more coal for more prifit margins!! (0)

For a Free Internet (1594621) | about 2 months ago | (#46943699)

Silly feell-good middle class "activism" does nothing.

Only a world planned economy under the workers rule can begin to reverse the harmful ecological consequences of capitalist anarchy.

Great, more profit for the rest of us (0)

Anonymous Coward | about 2 months ago | (#46943711)

Owning a company or not isn't going to determine whether an industry is profitable.

To the contrary (2, Interesting)

turkeyfish (950384) | about 2 months ago | (#46944103)

By selling Stanford will put downward pressure on the stock of coal companies, which means they have less capital against which to borrow and pay executives their stock options. It will take more and more stock options to keep the insiders happy, which will put further pressure on the stocks as other stockholders recognized they are soon to be the last guy out and the one holding the bag. If owned stock in a coal company, I would be selling as quickly as possible and moving into solar, wind and other renewables, since these will be the growth industries of the future, while fossil fuels will be creating more and more pollution and health problems for more and more people, leading to more litigation, more calls for regulation and less profits, especially as the world grows hotter and hotter and the 99% figure out they are being stuck with the tab. Its bad enough that oil companies have been raising prices recently to fund lobbying and campaigning for their favorite republican candidates. As fracking leads to more earthquakes and health and water issues, expect to see the profits in the fossil fuels sectors decline as those in the alternative energy industries rise as new technologies power increase efficiencies and growing public acceptance. It will only take one El Nino to drive this point home to all but those most deeply in denial.

Re:Great, more profit for the rest of us (2, Insightful)

Anonymous Coward | about 2 months ago | (#46944847)

Hah. And here I've been writing paragraphs on other sites trying to explain this to people. Well put.

turkeyfish, stock sales don't put downard pressure on the value of a company. The put a temporary downward pressure on the trade value available on an exchange. But all that effects is liquidity. As long as even two sufficiently-capitalized bidders understand the value of the underlying company, coal stocks would maintain their price with only those two bidders. Why would one of them turn down the stock at a bargain price?

The value of these companies, and thus the value of their stock, is driven by the value of coal. That value is realized on the energy market, not the stock market. The stock market is only where that value is *traded*. Theoretically, sure, massive investor actions could upset underlying dynamics. But it doesn't take a Stanford grad to know that coal energy will never be stopped, or even much affected, by voluntary divestment activity. There are simply too many remaining sources of capital, to the extent that these companies even need new capital at this point. And there will always be enough people happy to soak up the profits of the companies, as long as there are buyers of coal energy.

Far smarter for Stanfard to point this out, then dedicate all coal-energy profits to avoid purchasing the *energy* from coal, and also toward reducing the cost of alternatives, not just for Stanford, but for everyone. They actually chose PR *over* environmental responsibility, not to mention over simple economic intelligence.

Divest of Electrical Use Too? (0, Troll)

ntsucks (22132) | about 2 months ago | (#46943723)

Does this mean Standford will divest itself from the use of electricity too? Or is this just a hypocritical publicity stunt?

Re:Divest of Electrical Use Too? (0)

Anonymous Coward | about 2 months ago | (#46943771)

Wut ?

Re:Divest of Electrical Use Too? (1)

rubycodez (864176) | about 2 months ago | (#46943893)

that 30% of electricity that California imports, where does it come from?

45% of that produced inside the state is from natural gas, better than coal at least.

Re:Divest of Electrical Use Too? (1)

rossdee (243626) | about 2 months ago | (#46943857)

Maybe with that money they will buy a natural gas electrical generator.

Re:Divest of Electrical Use Too? (1)

WalksOnDirt (704461) | about 2 months ago | (#46943897)

Not much electricity comes from burning coal out Stanford's way.

Re:Divest of Electrical Use Too? (1)

bug1 (96678) | about 2 months ago | (#46943945)

Ok, ill bite;
Given that coal causes more harm to society than other forms of electricty generation (it causes more polution per kW), how is divesting coal investments hypecritical.

Re:Divest of Electrical Use Too? (3, Informative)

RugRat (323562) | about 2 months ago | (#46944205)

Does this mean Standford will divest itself from the use of electricity too? Or is this just a hypocritical publicity stunt?

Stanford receives electricity from two sources -- Cardinal Cogen, an onsite natural gas cogeneration unit, and PG&E. Neither of which use coal.

Re:Divest of Electrical Use Too? (1)

alexibu (1071218) | about 2 months ago | (#46944245)

So by your logic : no one can use electricity and be non hypocrites if they are not coal supporters.

This means that you think all electricity does and must always come from coal burning.

In fact electricity also comes from generators not powered by coal now, and in the future, all electricity will come from generators not powered by coal.

Huh? (0)

Anonymous Coward | about 2 months ago | (#46943727)

You make investments based on financial data and analyses. Not politics. Fire the Stanford trustees. Morons.

Re:Huh? (3, Insightful)

Anonymous Coward | about 2 months ago | (#46943811)

Wow, your time as a University trustee seems to have left you really bitter. Oh wait, you were *never* entrusted with maintaining a 120-year-old institution and its 11-figure endowment? Huh.

Stanford is a (very rich) non-profit educational institution, so while they have plenty of sharp investment managers it is not their sole obligation to maximize returns no matter what it takes. Their reputation is worth quite a bit to them. They bring in just about as much money in alumni donations as they do from the endowment.

Surely you must be joking (2)

turkeyfish (950384) | about 2 months ago | (#46944127)

Stanford is simply selling coal stocks while they are high and moving into alternative energies, which are on their way up. From an investment point of view this is a no brainer.

Re:Surely you must be joking (1)

geekoid (135745) | about 2 months ago | (#46944405)

and hopefully it's starts a large trend.

Re:Surely you must be joking (0)

Anonymous Coward | about 2 months ago | (#46944441)

And we will see how much those 'alternatives' actually go up in value. Without government support, most of those ventures would be bankrupt. Their product is too expensive. Examples: Electric cars vs. Prius; or while living in Texas, I was offered the choice of wind-generated electricity or traditional. I chose traditional at less than half the cost.

Sequoia logs (0)

Anonymous Coward | about 2 months ago | (#46943779)

Meh, I'll stock my stove with Sequoia logs.

Re: Sequoia logs (0)

Anonymous Coward | about 2 months ago | (#46944449)

Godwin-ing this post:

You could just round up all the poor and overpopulated undesirables and burn their bodies for fuel! It solves many problems at the same time. And remember to support Democracy, tow the party line!

Good Financial decision making (-1)

Anonymous Coward | about 2 months ago | (#46943823)

Sell it before Chavez Obama nationalizes the coal industry. Buy gold as a hedge before Obama prints away the national debt. Good for Stanford.

Re:Good Financial decision making (1)

turkeyfish (950384) | about 2 months ago | (#46944257)

No need to nationalize these industries. Alternative energy and natural gas are putting them out of business soon anyway. Stanford just doesn't want clunkers draining their portfolios going forward. Its not as if global warming isn't actually occurring.

Yet another sell out (-1)

Anonymous Coward | about 2 months ago | (#46943831)

to politically correct interests. Coal is there for us to use. Bloody tree huggers and their climate change whining.

Re:Yet another sell out (1)

DeathElk (883654) | about 2 months ago | (#46944727)

Yeah, god put the coal there for us to use, right? Fuckwit. Let's see how your bible saves you next time severe weather hits.

I wonder... (1)

NMBob (772954) | about 2 months ago | (#46943861)

How much social injury does having no electricity cause?

Re:I wonder... (1)

turkeyfish (950384) | about 2 months ago | (#46944305)

MIght be a good question to ask the Roman emperors, the French and English Kings and Queens. They seemed to have managed to leave a legacy without electricity. Besides, its not as if the only way one can generate electricity is by burning coal. In fact, solar and wind are proving progressively more and more competitive by the day and will likely be cheaper within 5 years time, which is one of the reasons Stanford is smart to get out while the price of their shares still has some value and they can get in on the ground floor of emerging alternative energy companies.

Re: I wonder... (1)

DigiShaman (671371) | about 2 months ago | (#46944521)

The industrial world is geopolitically hanging on by a thread!!! Wars have historically been fought over resources. Cheap energy and a functional representative government is the base economic factor for all of society. In fact, wealth can be attributed to the BTU. The more BTUs at disposal, the cheaper it is to grow food and make stuff without relying too much on human and animal labor. Shock the word with expensive energy and watch civil and global conflict rise. Getting rid of coal so quickly without a functional replacement could cause WWIII!

Misleading headline (5, Informative)

Daffy Duck (17350) | about 2 months ago | (#46943873)

Stanford University has an $18 billion endowment, but only a fraction of that is invested in coal mining companies. They're not just dumping $18 billion worth of stock.

Re:Misleading headline (1)

gtall (79522) | about 2 months ago | (#46944219)

They got started by Leland Stanford who was a railroad baron and not a particularly nice guy. However, one does not spend an endowment, one invests the endowment to use some of the returns for Stanford research, education, etc. and they use some for plowing back into the endowment so that inflation doesn't make it go bye-bye.

Lemme guess, if you win the lottery, you are going to piss it all on wine, women, and song.

$18.7 billion?! (0)

Alejux (2800513) | about 2 months ago | (#46943935)

How can a university have so much money?

Sorry, but it just seems wrong that institutions that are made to educate people and provide venues for scientific research, to become money hoarding corporations. How much research could they do with a fraction of that money?! The educational debt in the country continues to increase while all these universities hoard more and more wealth.

Re:$18.7 billion?! (2)

Missing.Matter (1845576) | about 2 months ago | (#46943979)

Stanford tuition, room, and board is actually free for students with families making less than $100k a year. http://paloalto.patch.com/grou... [patch.com]

Re:$18.7 billion?! (0)

Anonymous Coward | about 2 months ago | (#46944191)

Assuming they can even get in. Stanford only has about a 5% acceptance rate.

Re:$18.7 billion?! (0)

Anonymous Coward | about 2 months ago | (#46944371)

But... but... but... the Occupy hippies kept telling me only the rich can get into college. This must be a lie!

Re:$18.7 billion?! (2)

hondo77 (324058) | about 2 months ago | (#46943989)

Read. [wikipedia.org]

Re:$18.7 billion?! (0, Interesting)

Anonymous Coward | about 2 months ago | (#46944001)

Almost every individual university in the US is a billion dollar company purely on tuition intake alone. That anyone still believes these institutions exist for educational purposes is ignoring the reality of the industry it has become.

Re:$18.7 billion?! (4, Insightful)

krlynch (158571) | about 2 months ago | (#46944025)

Endowments return significant operating funds in up years, and sales from the endowment assets smooth out what would otherwise be significant operating losses in the down years; they decouple university operating finances from the business cycle and local politics. They _stabilize_ finances. They can also used as collateral allow for much larger debt funded initiatives to be floated. I dearly wish my university employer had a large endowment....

Put another way: you don't eat your seed corn. The endowment is the seed corn. Selling off an endowment for short term, short sighted "it seems wrong to have so much money!" would be criminal

Re:$18.7 billion?! (2)

MachineShedFred (621896) | about 2 months ago | (#46944137)

It has a lot to do with being founded by a railroad baron who didn't want to be the richest guy in the graveyard.

Re:$18.7 billion?! (1)

turkeyfish (950384) | about 2 months ago | (#46944143)

They live on the interest and capital gains. Think about it.

Re:$18.7 billion?! (1)

mysidia (191772) | about 2 months ago | (#46944185)

How can a university have so much money?

Wait... that's probably not even a significant portion of their money. It's just the portion they say is invested in coal. Responsible portfolio managers will typically not put more than 20% of their stocks in any one sector.

Re:$18.7 billion?! (2)

jratcliffe (208809) | about 2 months ago | (#46944897)

That $18.7 billion is the entire endowment, not just the portion invested in coal.

Re:$18.7 billion?! (1)

geekoid (135745) | about 2 months ago | (#46944411)

Harvard could pay for every incoming student, room board, classes materials for over 100 years based on what they have.

Re:$18.7 billion?! (1)

jratcliffe (208809) | about 2 months ago | (#46944889)

Actually, no, they couldn't. Net student income (i.e. total tuition, housing payments, etc.) was about $800 million last year. The endowment was $32 billion, of which $1.5 billion was spent last year. All else being equal, if you cut tuition to zero, you'd burn through the endowment in 40 years. Given that the institution has been around for nearly 400 years at this point, that would be incredibly short-sighted.

Re:$18.7 billion?! (0)

Anonymous Coward | about 2 months ago | (#46944561)

Are you byproduct of NCLB

the,
solar industry

Where will this coal go after divestiture ? (1)

nomad63 (686331) | about 2 months ago | (#46943947)

This is an amazingly stupid approach to look good and get into the good graces of green initiative supporters. But, I am sure, they are not going to stop producing coal from those mines. They are just going to sell it to another entity, which in turn will utilize "dirtier" methods to cultivate these mines and sell the same product to the public to cause the same amount of pollution. It is just plain dumb, but again this is a university suystem with roots in the most liberal of the places, San Francisco Bay Area. Good riddance to them.

Re:Where will this coal go after divestiture ? (1)

alexibu (1071218) | about 2 months ago | (#46944147)

While understanding US politics is always a struggle for me, I think this attitude is particularly noteworthy.

I think what you are suggesting is that to be a good Non Liberal you must invest blindly and only consider short term share value - even if you don't like the industry you must buy their stock if it is seen as a reasonable investment option on a profit basis only.

Does this imply that an authentic Non Liberal would need to invest in abortion pills, pornography, islamic religous organisations and prostitution where they are shown to be good investment options.

Re:Where will this coal go after divestiture ? (2)

gtall (79522) | about 2 months ago | (#46944231)

Not really, look at employment in the coal industry...it has shrunk quite a bit and certainly a lot recently as gas is eating their lunch.

Re:Where will this coal go after divestiture ? (1)

turkeyfish (950384) | about 2 months ago | (#46944235)

One can only imagine buggy whip and slide rule salesmen had the same sentiments as you express. How dare they divest from our anachronistic products. Stanford is simply wise to be the first institution out before the stock prices tank.

"carbon pollution" - LOL (-1)

Anonymous Coward | about 2 months ago | (#46943963)

Liberalism is a mental disorder. What arrogant, nation-wrecking shits they are...

www.wattsupwiththat.com
www.climatedepot.com

There is no such thing as catastrophic man-made global warming. So they renamed it 'climate change', while still IMPLYING, ALL THE TIME, that they actually mean 'catastrophic man-made global warming'. Call them out on this EVERY time they use the phrase 'climate change'.

At least coal works today (0)

Anonymous Coward | about 2 months ago | (#46943993)

Coal might not be the best choice environmentally but at least its functional today. How much money has the country wasted on pipe-dream "green" energy that mainly was setup as an easy way for their exec's to make a quick buck? Instead of trying to make a political point, why not use their resources to actually CREATE a functional "green" energy source and give that technology to the public so we could migrate from coal.

My grumpy-cat side wishes the coal-fired power plants could be allowed to shut down for a week or two just to see the stupid looks on all these "activists" faces when their power goes out. Maybe a nuclear power plant will save them, you know we have built so many new and advanced ones lately.

This changes nothing (0)

Anonymous Coward | about 2 months ago | (#46944067)

If stanford really wanted to make a difference they would actually do something.
Selling stock for money will change nothing but their portfolio. It allows standford its to avoid a political liability. "COVER YOUR ASS" is the name of the game. Under no circumstance do you say or promote anything that will cause excess risk or expose any liability unless calculated and approved to be politically expedient.

Silly liberals (0)

Anonymous Coward | about 2 months ago | (#46944221)

Or they could have just taken all those "evil" profits they made off the coal stocks and set up solar for their entire campus.

Coal is energy (1)

Nukenbar (215420) | about 2 months ago | (#46944267)

Unless they want to turn off every light and computer on campus, they are still regularly using coal energy.

Not necessarily (1)

Anonymous Coward | about 2 months ago | (#46944343)

California has a pretty diverse power grid. [wikipedia.org]

On another note, it's only early May and we are already having air quality problems here in Metro Atlanta.

We are all coal around here and big trucks.

And due to my health issues, I'm stuck indoors.

I just wish we could get away from this antiquated 19th century fuels and engine technology and move into the 21st century.

Misleading... (1, Interesting)

erp_consultant (2614861) | about 2 months ago | (#46944535)

First of all, Stanford does not own $18B in coal stocks. 18B is the ENTIRE endowment amount. Coal stocks are a small fraction of the total.

Now that that little correction is out of the way....

Stanford seems to me to be making an entirely political statement. Selling all of their coal stock is not going to change the supply of coal by even an ounce. Someone else will simply buy the shares.

I wonder how many of those coal plants are producing electricity that powers all those Teslas that I see on the roads here? The electricity has to come from somewhere and there are not enough Solar panels to meet the need. Other options? Nuclear? Not in California.

Almost any way you slice it, power generation is a dirty business.

Shouldn't the responsibility of the endowment trustees be strictly fiduciary? In other words, manage the money and leave the political grandstanding to someone else.

I'm happy to buy (1, Insightful)

amightywind (691887) | about 2 months ago | (#46944543)

I will be happy to buy the stock, at a low price. Since 2008 I have made a small fortune investing in politically unpopular energy stocks. But even scumbag liberals like to turn on the lights and drive their cars.

Stock price (1)

Iniamyen (2440798) | about 2 months ago | (#46944711)

I hope they got a good price! Er no, wait, that would be ba--- does not compute!!!
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