To be fair, Mohamed El-Erian made the leap back to PIMCO. He was already a fairly senior member of PIMCO's staff before accepting the Harvard Endowment job.

Hey Paul,
I think you're incorrect here:

Motivation to run these funds. The opp to apply those skills get good $(but not WS$)& do more than $ for $'s sake.

DS case in point: Runs Yale's $ for 14 yrs, his comp is puny on WS, but his returns kick the a**es of anyone, Endow$ or WS. He can run whatever he wants but stays put.

M E-E's predecessor did 15yrs and left out of frustration w/ faculty politics & his team's reimburse. Opened shop and still runs a big % of Harvard's $. Not a huge step away or up.

M-E-E had no Univ exp and little $ mgmt exp. 6 yrs at PIMCO, of all places, prev analyst at SalmonB and the IMF. Hardly a hedgefund mgr on the make. He was interim & most knew it.

JM comes from 15yrs in the endow grp at Harvard, w/6 yrs off running the Wellesley $. She likes/knows this space. Not a gordon gekko type. In her space she's hit the roof (forget glass ceiling). Why would she leave?
Thoughts?

Josh
jdlazar@gmail.com

Why would Fidelity hire someone like that? Has she ever made money herself? Do you have any direct evidence that she is particularly talented at selecting managers, picking an asset allocation, or anything else?

But, good news! She's a woman! No doubt, Faust and her ilkesses are happy . . .

Larry, do you have a problem with the "ilk" of
half the human population? Does Drew Faust's
chromosomal ilk irk you? Do you know squat about
Harvard? Or do you squat to pee this bilge?

Like my Meema used to say, Doog, "There's no point being a stupid if you can't show it."

Dead on! There are two possibilities here:

1) Jane Mendillo was the best Harvard could do, regardless of gender considerations. But she previously managed a $7 Billion chunk of the Harvard endowment before apparently being forced out by the legendary Jack Meyer. She left to take over the then $1 Billion Wellesley endowment - talk about a demotion! Since taking over at Wellesley, she has averaged a sub-peer-average perforance of just 13.5%. How many people must have turned Harvard down if they were reduced to this choice? With that history, it is almost inconceivable that she will be able to control the Harvad investment committee. In other words, the Harvard endowmwnt will be rudderless. In addition, Harvard has done essentially nothing to address its huge internal problems: if they pay their managers enough to keep them, they get savaged by critics of the rich compensation ... and the managers then leave anyway (see Jack Meyer). El Erian was complaining about this to the New York Times within months of his arrival! Since El Erian left, two other senior managers have left. She will leave. This is the best Harvard can do? O my God.

(2) She was not the best Harvard could do, but she was the best WOMAN who would accept the job. When you consider (1) above, this is actually the LESS damning possibility. But, of course, if Mendillo was picked in part or in whole over other more-qualified men because of her gender, she will have that much more trouble being credible - especially in troubled times. She will leave.

Management of the Harvard endowment is a complete mess. The miracle is that the disaster has not hit yet. In this market, that miracle will not last.

Terry wrote: "she previously managed a $7 Billion chunk of the Harvard endowment before apparently being forced out by the legendary Jack Meyer."

Jack Meyer actually commented on Mendillo's appointment to lead the Harvard endowment to the New York Times [here: http://www.nytimes.com/2008/03/28/business/28harvard.html?_r=1&ref=business&oref=slogin]. Here's the relevant part of the Times article:

"The university’s decision was greeted with enthusiasm by people who have worked with her and in the endowment world in general. 'She is an excellent choice,' Mr. Meyer said in a telephone interview on Thursday. 'She is smart. She is soft spoken, but she is a tough negotiator.'

"Mr. Meyer recalled that when Ms. Mendillo worked on real estate investment for Harvard, 'she went down to Texas by herself and negotiated with two people that represented the seller of the property.'

"'She did a terrific job,' he said. 'She did it alone and came back with a transaction that was much better than what we were aiming for.'"

Those are positive comments as far as they go, but odd ones. First, he seems to avoid saying that she did a "terrific job" with her portfolio ... only with one Texas real estate transaction. He's trying to be nice, but he does not say that he was sorry to see her leave the Harvard fund when he ran it. He avoids commenting on her ability to choose managers or investments - but that SHOULD be most of her new job. But is it?

He says that she's a "tough negotiator," but how much negotiation is she going to be doing in her new position ... except with internal Harvard officials? Is he’s saying here that she’s no pushover, and that the Harvard people should take note because she will stand up for herself and not get run over by the people who did in Jack Meyer? Hard to say. But by focusing on her "toughness" Meyer suggests (or is made by the Times to seem to suggest) that "toughness" (ability to stand up to criticism?) has become the most important qualification for her new job ... a qualification now overshadowing the ability to pick managers or investments. If so, how would he know how Mendillo would respond to internal criticism unless she was seriously criticised while she worked for Meyer, before she finally left?

Strange it all is. Passing strange.

Of course, it's still a good comment from Meyer.