University of Texas Invests in Gold
Forget stocks or hedge funds. The University of Texas is investing its endowment in gold.
The university, which has the fifth-largest endowment in the U.S., invested 3 percent, or $500 million, in the commodity. It is unusual for a university to invest in gold, and its value only increases during periods of inflation. Fears of an unsteady international financial market mixed with the probability of inflation have led them to purchase the precious metal.
“Recently, we’ve added 3 percent, 3 percent of our portfolio, into gold as a protection against inflation, but even more as a lack of confidence in financial markets due to extraordinary government fiscal and monetary stimulus,” Bruce Zimmerman, UTIMCO CEO, told the University of Texas board of regents last Wednesday. “I wish I could tell you the future looked rosy. Unfortunately, that’s not our view. At best, we believe the future is uncertain.”
The university, like many others, has felt the strain of the recent recession. Donations plummeted in 2009. UT received nearly $200 million less in gifts than in 2008.
Though, this isn’t the first wave of financial concern this year. In June, the school had to borrow $516 million to pay for an IRS audit. The campus, located in Austin, is under investigation for the tremendously high salaries of some of its employees, especially, the $5.1 million salary paid to football coach Mack Brown.
Via The Huffington Post and the Houston Chronicle