Management

How Not To Invest – A Lesson From The University of Chicago

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CRSP’s origins date back to the 1960s. Its initial goal was to build a database of historical stock prices. This is harder than it might seem. Before trading was computerized, stock prices were maintained on paper. And when stocks split or companies merged, that added to the complexity.

Despite this seemingly dull mandate, CRSP has played an important role in the development of modern finance over the years. Most notably, the efficient market hypothesis and the capital asset pricing model were both made possible by CRSP data. And today, many of the world’s largest index funds, including Vanguard’s Total Stock Market Fund, are built on CRSP indexes. Endowment Lessons https://humbledollar.com/2026/02/endowment-lessons/

This article by Adam M. Grossman uses the University of Chicago’s financial struggles as a cautionary tale for individual investors.

Key Lessons for Individual Investors

  • Spending: Avoid “Keeping Up with the Joneses”
    • The university invested heavily in new buildings and programs to maintain its “eminence” without securing corresponding revenue.
    • Takeaway: Financial success depends on income exceeding expenses. Operating costs of new assets (like large homes or complex projects) must be planned for in advance.
  • Saving: Beware of Recency Bias
    • During a 15-year market boom, the university ramped up debt rather than stockpiling resources.
    • Takeaway: Investors often falsely assume current trends will continue forever. Use periods of market strength to re-balance portfolios and manage risk rather than increasing lifestyle or debt commitments.
  • Investing: Complexity vs. Simplicity
    • Performance: UChicago’s endowment returned 6.7% annually over 10 years, trailing a simple Vanguard Balanced Index Fund (VBIAX), which returned 8.2%.
    • Liquidity: The university locked over 60% of its funds into illiquid assets like private equity and real estate, making it difficult to cover cash flow needs.
    • Takeaway: High-fee, complex, and illiquid investments often under-perform simple index funds. If elite institutions with dedicated investment offices “are having second thoughts” about private equity, the message for individual investors seems clear.

This summary was produced by Gemini AI and edited by yours truly.

Here’s a link to an article on the sale of CRSP. Morningstar Completes Acquisition of CRSP and Extends Relationship with Vanguard https://newsroom.morningstar.com/news/news-details/2026/Morningstar-Completes-Acquisition-of-CRSP-and-Extends-Relationship-with-Vanguard/default.aspx

Scary Charts 02.02.26

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The jobs market is starting to show hard-to-ignore cracks – https://www.axios.com/2026/02/05/jolts-data-december-jobs-market

US employers cut more jobs last month than in any period since 2009. More than 100,000 workers were fired at Amazon, UPS, and Dow, and hiring was the slowest for any January on record, according to outplacement firm Challenger, Gray & Christmas. The low-fire, low-hire dynamic that has kept the US labor market in an anxious balance appears to have tipped. US layoffs in January hit highest monthly record since 2009 – https://www.semafor.com/article/02/05/2026/us-layoffs-in-january-hit-highest-monthly-record-since-2009

Yikes.

Think Again About Outsourcing Your Thinking 2.0 (if you can)

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Michael Gerlich, head of the Centre for Strategic Corporate Foresight and Sustainability at SBS Swiss Business School, began studying the impact of generative AI on critical thinking because he noticed the quality of classroom discussions decline. Sometimes he’d set his students a group exercise, and rather than talk to one another they continued to sit in silence, consulting their laptops. He spoke to other lecturers, who had noticed something similar. Gerlich recently conducted a study, involving 666 people of various ages, and found those who used AI more frequently scored lower on critical thinking. (As he notes, to date his work only provides evidence for a correlation between the two: it’s possible that people with lower critical thinking abilities are more likely to trust AI, for example.) Like many researchers, Gerlich believes that, used in the right way, AI can make us cleverer and more creative – but the way most people use it produces bland, unimaginative, factually questionable work. Are we living in a golden age of stupidity? – https://www.theguardian.com/technology/2025/oct/18/are-we-living-in-a-golden-age-of-stupidity-technology

Yikes.

Scary Charts 12.01.24

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Office CMBS Delinquency Rate Spikes to 10.4%, Just Below Worst of Financial Crisis Meltdown. Fastest 2-Year Spike Ever – https://wolfstreet.com/2024/11/30/office-cmbs-delinquency-rate-spikes-to-10-4-just-below-worst-of-financial-crisis-cre-meltdown-fastest-2-year-spike-ever/

Yikes.

The world’s worst countries for binge-drinking – https://www.statista.com/chart/5357/the-worlds-worst-countries-for-binge-drinking/

Yikes.

Which Lifestyle Changes Can Make You Live Longer? – https://www.statista.com/chart/31766/reduction-in-the-risk-of-premature-death-after-age-40-when-sticking-to-the-lifestyle-factors/

Yikes.

The Worst U.S. States For Binge Drinking – https://www.statista.com/chart/12345/the-worst-us-states-for-binge-drinking/

Yikes. But a great day for Scary Charts!

A Broad Range of Flexible Retirement Arrangements

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A Phased Retirement Program

Emory University is one of the few employers that offers a phased retirement program. Here’s a breakdown of how its program works:

  • The phased retirement commitment must be for a defined duration, spanning a minimum of six months to a maximum of three years.
  • Throughout this period, you’ll adjust your work hours, reducing them by anywhere from 10% to 50%, while maintaining a minimum of 20 hours per week.
  • By participating, you agree to retire at the end of the specified time frame.
  • Your pay will be adjusted to reflect the reduced workload during phased retirement.

Source: Phased Retirement: What Does It Mean And How Does It Work? — https://www.thepennyhoarder.com/retirement/phased-retirement/

Sign me up (when I’m ready).

Genius Marketing Stuff

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I post things online because I find them interesting. Sometimes I post things online as a part of my collection of Electronic Sticky Notes, a reminder to myself to try a new recipe like https://spainonafork.com/my-mothers-lentil-stew-with-sweet-potatoes-recipe or as in this case a reminder to go back and listen to the entire interview when I have time. The first five minutes of this video taught me something I never knew about product positioning. The interview is over an hour long so I want to watch and listen in bite size chunks.

The Best Retirement Letter Ever

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That’s it!

My favorite excerpt from the letter:

Let’s be honest, some people in academia are horrible, arrogant, selfish and narcissistic. And no matter how much the people at the top say they deal with bad behaviour, the nasty folk do have an annoying habit of getting promoted. The way in which academia selects and rewards particular skill sets produces an over-concentration of people who are low on empathy. I’ve met a lot of those ‘special’ colleagues over the years (no names mentioned obviously). I will not miss them one jot. They create a toxic working environment , dominate the discourse, ride roughshod over the rules, and cause a great deal of harm to others and get away scot-free. They’ve done me significant mental damage, but I can now happily forget them and move on with life.

My recommendation to anyone starting out in academia is stand your ground, challenge these energy vampires and politely make it clear that you don’t want to play their stupid toxic games. They really don’t have the power that they want you to believe they have, even though the system tends to promote them to roles that are beyond their emotional competence to fulfill. Pity them for the lack of other things to do with their lives. And, remember that 98% of what we do as academics is of no importance at all out there in the real world, so when a self-entitled colleague insists that their work on their favourite gene is earth-shattering; more important than anything you could ever do; and a good reason for their career to be advanced faster than yours; just smile and ignore them. Do your own thing, at your own pace. Have a life outside the university and remember that it’s just a job.

https://journalofhumannutritionanddieteticseditor.wordpress.com/2023/11/27/thats-it/