In chapter 7 Charles Wheelan really focuses on investing and how to be a smart investor. One of the most interesting examples he gave was the Harvard endowment and how that has become so large because of the risks they took when investing. Then the economy crashed in 2008 and Harvard lost approximately one third of the total endowment investment in the market. The author makes a personal comparison to the risky investing compared to his moms low risk investing which is done in a checking account. The colleges like Harvard can do these kind of investments because they do not need a quick turn around, they can keep the money in the market for years upon years. Some people may question the judgement for a college to just put all of their endowment money into the rapidly changing stock market, but when you look at is deeper it is not about the short term gain but the long term gain. Overtime this practice has lead Harvard to have one of the largest endowments for any college, and today this amount is around 36.4 billion dollars. This is just really interesting because of how smart these colleges are to figure out all of the economics behind this investing of enormous quantities of money and the market turn around. This practice is in a way only seen with colleges and instutions because they can afford to have short term losses and wait for the real pay day over time. That is because many people are very careful with their money and don't want to just risk putting it up into the air and waiting to see how much will come down.
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