Notes from the Diamond #6: Hittin’ ‘Em Where They Ain’t (Part 1)

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David A. Salem
Email: david.salem@epsilontheory.com
Twitter: @dsaleminvestor

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Part 1: Zest in the Pursuit

Keeping Busy.  To help myself and perhaps other members of the ET pack move through the current MLB off-season more productively than Rogers Hornsby moved through the many off-seasons he endured,[1] I’ve crafted a two-part note about a cardinal challenge in both baseball and investing: hittin’ ‘em where they ain’t.  Part 1 focuses on pros who’ve met this challenge uncommonly well; Part 2 (slated for publication as spring training shifts into high gear later this month) will focus on means that investors might employ to meet this challenge in coming years and beyond.

Pet Peeve. The prior note in this series (Note #5) focused on personal traits enabling certain players to achieve greatness in investing or baseball, and ended with a question about one such great:

What would’ve become of the PE [private equity] industry if, instead of devoting a large fraction of Yale’s endowment to PE, [Yale CIO] David Swensen had deployed all such capital via managers investing exclusively in publicly traded stocks of owner-operated firms?  ‘Tis hard to say, but I’ll try … in my next note.

Before tackling the foregoing question, I feel compelled to do two things.  First, I’ll encourage readers who haven’t digested fully Note #2 (on excessive “juicing” by private equity and baseball pros) and the aforementioned Note #5 (on excessive mimicry of “the Yale model”) to do so before reading what follows, parts of which may seem naïve absent such auguries.  Second, I’ll raise and answer a question that’s both central to this series and worthy of more attention than it typically attracts in discourse about greatness in investing or baseball: what metrics should be used to distinguish truly great practitioners from merely good ones? 

To be sure, with computer-based analytics having transformed both the playing and business of baseball since the current century dawned, pros in that arena devote not merely ample but arguably excessive airtime to quantifiable metrics when grading past or current pros, be they on-field players or execs.  But there’s scant agreement on optimal metrics for divining true greatness in baseball, even and indeed especially respecting criteria for election to its Hall of Fame, and frustratingly scant discussion of optimal metrics for divining competence let alone greatness in finance. 

Pray tell, when was the last time you heard Paul Krugman an “expert” in finance articulate the precise metrics and time horizon underlying whatever critique of the Fed’s evolving policies they’re serving up on Bloomberg or CNBC?  Dunno ‘bout you, but I haven’t encountered such exactitude from a talking head since the San Diego Padres last won the World Series (WS).  That would’ve been … never, the Padres being the longest established MLB team to never win it all: 49 years and counting.[2] 

Gold Standard.  Why demand precision respecting both the metrics being used to gauge results and the time horizon over which they’re being applied when grading fiat-enabled capital allocators like Fed chair Jay Powell as distinct from return-oriented allocators like Swensen or me or perhaps you?  Why not?  If, as Ben Hunt argues persuasively in You Are Here, modern capital markets have morphed into political utilities, it seems not merely fair but essential that we ask whether such utilities’ ongoing administration is producing the optimal deployment of capital — taking due care to define optimal, of course.  By my lights, optimal in this context means the deployment of financial capital that enables the maximum number of citizens to achieve their full potential under whatever boundary conditions the allocators being judged are laboring and neither created themselves nor have the power to change

The italicized caveats are crucial, as exemplified by the tenures of the greatest and least-great Fed heads in my lifetime: Paul Volcker, Fed chair for eight years starting August 6, 1979; and William Miller, Fed chair for 17 months ending the date Volcker started.  Miller didn’t create the stagflation that gripped the US economy in the late 1970s; indeed, given Volcker’s not insignificant role in Richard Nixon’s decision to end the greenback’s convertibility to gold in 1971, Volcker arguably deserves no less blame than Miller for the stagflationary conditions both men encountered during their tenures atop the Fed.[3]  That said, Miller himself took no effective steps to end such torpor — a scourgewhose ultimate purging by Volcker makes his tenure at the Fed the gold standard for greatness in not only central banking but arguably also in capital allocation broadly defined.

For me, that standard or test is simply stated: did the person being graded act boldly enough for long enough to boost materially and sustainably the achievement of human potential? 

Strikingly Similar.  Which past or present players in investing or baseball meet the test for greatness just proffered while also serving as useful case studies for contemporary readers seeking to elevate their own games? 

Many candidates come to mind, some of whose achievements were flagged in prior notes and will be discussed further as this series unfolds, e.g., investor par excellence Jeremy Grantham and baseballer par excellence Joe Torre.[4]  Here and now, however, the tidiest answer I can give to the question just posed while also moving toward an eventual answer (in Part 2) to the counterfactual query raised at the outset of this note is by comparing the words and deeds of the investment pro mentioned in it to those of a legendarily accomplished baseballer whose temperament and indeed origins resembled Swensen’s: Branch Rickey.

Clear Eyes.  Like Rickey, who lived in central Ohio from his birth through completion of his undergrad studies at Ohio Wesleyan, Swensen trod a conventional path to and through college, earning a bachelor’s degree from the UWisconsin branch where his father served as dean of the college and chemistry department chair (UW-River Falls) and from which all five of Swensen’s siblings would also ultimately earn degrees.  So far as I can tell from published accounts of both men’s dealings as well as conversations with Swensen himself, their early 20s were essentially the last intervals in their lives when either Rickey or Swensen fancied getting along to even remotely the same degree as getting ahead.

Indeed, as Lee Lowenfish’s fine biography of Rickey makes plain, and as the ever-expanding universe of writings by and about Swensen makes equally clear, both men rose to the top of their chosen professions by practicing doggedly what Rickey’s fellow Hall of Famer Willie Keeler preached in his oft-quoted response to a reporter’s query about hitting: “I have already written a treatise [on the subject]”, Keeler crowed, “and it reads like this: Keep your eye clear and hit ‘em where they ain’t.[5]

Man vs. Machine.  While never easy, practicing what Keeler preached is markedly more difficult for current pros in both baseball and investing than it was in Rickey’s day.  There are multiple reasons why, including the adoption in both fields of genuinely meritocratic criteria for recruitment and advancement (more on which below) as well as a more dominant catalyst for change that Rickey lived and died too soon to have confronted in the workplace (and likely mastered if given the chance): computer-based informational technologies and the quantitative methods for deploying capital they facilitate. 

Importantly, in both pro baseball and investing the capital being deployed via increasingly quantitative or formulaic methods comprises human as well as financial capital, with the latter (money) being used routinely to obtain the former (talent) in baseball, via market-clearing contracts for free agent players and coveted executives, and with money in the form of fees being used routinely to obtain the asset management talent institutional investors deem essential to achievement of their stated return goals.[6]

Crowded Trades.  As the fine folks at Vanguard among other straight-shooting investment pros have observed, many institutional funds are pursuing return goals they have little or no chance of achieving.  More precisely, such funds have little chance of achieving their stated return goals with their current policies and strategies — means not uncommonly adopted with the specific aim of being “like Yale.”  Paradoxically, as suggested in Wannabes Beware, one reason among others why most institutional funds bent on parroting Yale will fail in the effort is because Swensen has proven so maddeningly effective in preaching publicly what he’s practiced during his commendably long (1985 – present) and ongoing tenure as Yale’s CIO.

To be sure, the illiquid strategies that Swensen has used so effectively on Yale’s behalf — comprising the lion’s share of Absolute Return plus all exposures above it in the nearby graph — haven’t attracted unduly large commitments from institutional investors as a group merely because David has expounded eloquently about them. Rather, locking up capital to the degree Swensen has on Yale’s behalf has become SOP in institutional funds management because in that arena, as in pro baseball, success breeds copycats.

Swensen’s success surely has, as did Rickey’s in developing a system for player recruitment and development that’s served as table stakes for MLB teams since it began producing riches for the Rickey-led Cardinals a century ago. 

Kevin Kerrane tells the tale briefly and well in Dollar Sign on the Muscle: The World of Baseball Scouting:    

[F]rom 1913 to 1917, [Rickey] experimented briefly with the idea of a farm system—direct control of minor-league teams by the major-league parent organization … The farm system was a strategy for saving money: instead of bidding against other major-league teams for minor-league players, Rickey wanted to grow his own.  After World War I, when the minors were in a financial slump, Rickey put his strategy into effect … [B]y 1939, the Cardinal empire included 32 minor-league teams and about 650 players. 

The Cardinals bought pitcher Jess Haines in 1920, and purchased no more players until 1945.  The system did save money. But it made money, too. Rickey was able to generate such a steady supply of young talent that he could sell off the excess at a nice profit, while providing the Cardinals with enough manpower to win nine pennants by 1946 … The competition among so many young players in the system operated as a kind of natural selection.  The minor-leaguers could be left on the farms until, as Rickey liked to say, they “ripened into money.” [Emphases added]

Searching Far and Wide.  As noted in the nearby box, building the pro sports equivalent of an early stage venture program was but one of several innovations Rickey conjured to better the various MLB teams he headed. 

Famously, one such initiative bettered not merely Rickey-led teams but America’s national pastime and indeed the nation more generally: the recruitment and ultimate promotion to the big leagues of non-white and foreign-born players

Like Swensen’s move decades later to expand materially the pool from which Yale draws money management talent by adding a globally diverse array of proven or promising players in illiquid investing to it, Rickey judged correctly that expanding the pool from which his teams drew talent by adding blacks and foreigners to it would pay off big time.  It did, with the more genuinely meritocratic criteria for roster construction that Rickey pioneered — like other innovations with which he’s rightly credited — ultimately becoming table stakes for MLB franchises seeking to field winning teams.[7]  Indeed, as of the most recent date for which reliable data are available (Opening Day 2018), 38% of players on MLB rosters were African-American or foreign born, including many of the sport’s most talented if not also most beloved stars.

Told You So’s.  No one can know for sure until the blessed day arrives how many African-American or foreign-born players will grace MLB rosters when the 2019 regular season commences on March 28.  Barring injury, however, one non-American who made his major league debut in 2018 will likely make the cut — for reasons that would’ve elicited cheers if not also an “I told you so” from Rickey.  Born and raised in Venezuela, 27 year-old Willians Astudillo hasn’t done anything as a pro baseballer that would’ve commended him to MLB front offices during Rickey’s many years heading such offices, unless they were headed by Rickey himself. 

Willians Astudillo at the plate for the Twins in 2018

Ever heard of Astudillo before reading this note?  If yes, it’s for one or both of two reasons: (1) an attractively brief and hugely fun video of his homer in a recent winter league game went viral or (2) Astudillo’s remarkable consistency in avoiding strikeouts — a prized skill indeed at any level of play in baseball — has created a big buzz in MLB circles, teeming as they are in the post-Moneyball era with quant jocks cranking out advanced statistics.

There were no such geeks holding full-time posts in pro baseball, and no advanced stats worthy of the name being compiled in baseball circles, until Rickey hired an immigrant to crunch numbers for the Brooklyn Dodgers in 1947.  Over the next four decades, a Montreal native and former NHL statistician named Allan Roth helped first the Dodgers and in due course not fewer than 20 MLB teams develop enhanced methods for allocating both human and financial capital — on the field (via shrewder defensive positioning and other tactics) and off it (via shrewder personnel policies). 

Roth also helped burnish Rickey’s reputation as “the Brain” of pro baseball by ghost-writing parts of “Goodby [sic] to Some Old Baseball Ideas” — a storm-the-ramparts piece published in Life magazine in 1954 that Michael Lewis mentions briefly in Moneyball, his 2003 bestseller on Billy Beane’s surprisingly lonely efforts as a modern GM to practice what “the Brain” had preached a half-century earlier.  

Lonely No Longer.  However lonely Beane (or Rickey) might have felt using methods that rival GMs deemed imprudent or distasteful, such loneliness was destined to fade.  And so it did, rapidly and rather fully as the Aughts progressed, owing partly to Lewis’s authorial skills and in larger part to Beane’s and later Red Sox GM Theo Epstein’s conspicuous success implementing such methods (a/k/a sabermetrics).[8] 

Similarly, however lonely Swensen (or his longtime and unfailingly supportive investment committee chair Charley Ellis) might have felt using methods that rival CIOs deemed offputting, such loneliness was also destined to evaporate, owing partly to Swensen’s powers of persuasion and in larger part to the stunningly good returns Swensen notched in the years surrounding his pathbreaking book’s initial release.[9] 

Selfish Concerns.  Having fretted publicly at the time of Pioneeering Portfolio Management’s initial publication in 2000 about its potentially deleterious impact on my longtime and highly rewarding vocation (managing money), I fretted privately at the time of Moneyball’s publication in 2003 about its potentially ugly impact on my favorite and generally lovely avocation (watching baseball). 

Sad to say, the concerns just referenced have proven well-founded, with low hanging fruits as well as most harder-to-reach edibles in the illiquid niches that Swensen helped popularize now getting eaten by institutional pachyderms even before they ripen, and with MLB games getting longer and generally more predictable as quantitative methods increasingly supplant intuition as the primary basis for decision-making in dugouts as well as front offices.

(Please don’t tell my kids, whose company I’m keen to continue having for Bosox games at Fenway, but the fraction of plate appearances ending with balls put into play has slumped discernibly since the so-called sabermetric revolution in MLB commenced — from about 74% in 2003 to about 68% in 2018— with strikeouts as a percentage of such appearances moving steadily and depressingly in the opposite direction: roughly 22% in 2018 versus roughly 16% in 2003.  More on such trends — and parallel trends in institutional investing, such as they are — as this series unfolds.[10])

Multi-Tasking.  Don’t get me wrong.  I still love investing, and watching baseball, and please don’t tell my clients — doing both simultaneously.  And I’m confident both domains will continue producing greats as defined above: pros acting boldly enough for long enough to boost materially and sustainably the achievement of human potential. 

Rickey and Swensen certainly qualify as greats by my lights, passing the test just mentioned and in certain respects an even sterner test of greatness for capital allocators of all kinds including but not limited to baseball execs and endowment CIOs: did the allocator being judged not merely handle effectively the external boundary conditions he or she confronted but take effective steps to reshape them in a socially beneficent manner?

Rickey obviously did, as Americans will be reminded anew in coming months via festivities MLB has planned to mark the centennial of Jackie Robinson’s birth.[11]  Swensen’s reshaping of boundary conditions governing his professional labors, while less obvious and momentous than Rickey’s earlier reshaping of his, has been material and laudable nonetheless.  By shifting meaningful fractions of Yale’s investable wealth out of marketable securities in general and tradable bonds in particular into illiquid assets better suited to the profitable exploitation of endowed charities’ perpetual life status, Swensen has created the proverbial win-win, lowering the cost of capital for enterprises in which Yale has invested while simultaneously boosting returns on Yale’s investable wealth.

As this unlocking of institutional potential has progressed — initially and most intrepidly at Yale and in due course at other institutions with so-called permanent capital to deploy — it  has catalyzed a parallel unlocking of human potential, with many intelligent and energetic investment pros granted opportunities that earlier generations of workaholics lacked to deploy such capital in a manner befitting its presumed longevity.

No One’s Perfect.  I recognize that the prior paragraph may make some readers gag, the illiquid strategies it commends having destroyed perhaps more wealth net of fees than they’ve created for institutions employing them as a group.  I recognize too that, as could rightly have been said of Rickey, Swensen’s rigorously data-driven approach to capital allocation hasn’t produced uniformly enlightened decision-making.  Obviously, none of Swensen’s slips have been bad enough to knock him off his lofty perch in his chosen profession, as happened twice to Rickey after he became a big shot in pro baseball: “demoted” (as Rickey saw things) from on-field manager to “business manager” (and de facto GM) by the Cardinals in 1925, Rickey underwent similar humiliation four decades and multiple championships later, when the same Cards terminated Rickey’s contract as the team’s sage-in-residence following its triumph in the 1964 World Series. 

Regrettably for Rickey, but fortunately for Swensen and me and perhaps you, managing money tends to be a more forgiving line of work than managing big leaguers.  While there’s certainly truth in Rickey’s oft-quoted boast remark that “luck is the residue of design,” let’s be honest: to a much greater extent in money management than in baseball, pros can commit impactful errors and still come out on top.  This is especially true of errors of omission, which Swensen arguably made in applying the tenets flagged in the nearby box when and how he did, and that many US-based institutional investors are arguably making as the current century unfolds.

Admittedly, none of the tenets just referenced has proven fundamentally unsound since Swensen’s painstaking studies of capital market history caused him to apply them on Yale’s behalf starting around the time the aforementioned Volcker wrapped up his winning campaign to bend general price inflation downward.  That said, if it’s OK for Rusty Guinn Astros fans to disparage that otherwise superbly managed team’s 2014 decision to “outright” or fire J.D. Martinez at what proved to be the start of a multi-year (and hopefully continuing!) stretch as one of the best power hitters in baseball, it’s presumably OK for Swensen votaries including me to note that bonds have performed much better relative to stocks over the full sweep of David’s tenure than his grand design for Yale’s endowment supposed, especially on a risk-adjusted basis.

Walking the TalkMy fellow ET contributor Peter Cecchini examined the phenomenon just referenced in a recent post, so I won’t discuss it further here, except to say this: as Peter hints, applying data-driven methods like those Swensen used to fashion “the Yale model” back in the day when fashioning investment policies in 2019 would be a mistake of potentially Snodgrassian proportions.[12]

Strike that: there’s nothing wrong with making data as distinct from tradition or intuition king in the policy-making process, as Swensen did as a novice CIO or as Rickey and Roth did for the Truman-era Dodgers, so long as one uses the best available data.

Having bemoaned above the tendency of finance types to opine on all manner of things without articulating clearly the metrics and time horizon underlying such judgments, I’ll walk that talk here by noting that “best” as I’ve just used it means data germane to the deceptively difficult task of enhancing the real or inflation-adjusted value of invested capital over the next 35 years. 

Why 35?  Because I haven’t a clue how materially societal and technological changes will affect the future duration of generational cycles; and the 35 year investment horizon that the estimable Dr. Hunt has referenced in Pricing Power (Part 1 and Part 2) strikes me as an attractively precise substitute for what I really have in mind: a mindset compelling fiduciaries deploying capital today to weigh the interests of future beneficiaries of such capital at least as heavily as the current generation of same.    

Clearly, not all readers are aiming to enhance real wealth over such an extended horizon, even with small portions of their investable wealth.  Just as clearly, many endowed charities are, with the typical publicly supported non-profit impliedly seeking annualized real returns in the range of 4-5%: ongoing enhancements to real wealth needed to offset such orgs’ customary endowment spend rates of 4-5%.[13]

What to Do?  Where in the world can today’s investors deploy capital with reasonable assurance of earning annualized real returns of 5% or more over long and potentially indefinite holding periods?  Just as no wonk worth listening to on monetary matters should critique the Fed’s evolving policies without stating clearly the metrics and time horizon he or she is using to gauge such policies’ success, no hired gun worth canvassing on the real return quandary just referenced should address it without first pushing the ultimate owners of any such capital to articulate with reasonable clarity the types and degrees of risk they’re able and willing to tolerate.  That said, I’m skeptical any strategies the typical investment committee at work today would readily endorse will do the trick, least of all US-focused PE of the sort Swensen funded aggressively and adeptly when most institutions would not and could not.  

Indeed, even as Yale wannabes continue ignoring data Swensen himself cited in Pioneering Portfolio Management respecting PE funds’ ugly tendency to underperform comparably leveraged investments in marketable stocks, stewards of long-term capital outside as well as within the endowment arena are generally ignoring readily available data pointing them toward plausible solutions to the real return quandary raised above.  I alluded to such data in the still unanswered! question with which this note opened and will discuss them and the investment pros who’ve brought them to my attention in Part 2 of this note.  As will be seen, like the astute allocators on which this post has focused — Swensen and Rickey — the pros in question seem to take special delight in hittin’ ‘em where they ain’t.

End of Part 1

PDF Download (Paid Subscription Required): Notes from the Diamond #6 – Hittin ‘Em Where They Ain’t (Part 1)


On Deck

Hittin’ ‘Em Where They Ain’t – Part 2: Addition by Subtraction

Jackie Robinson with Dodgers manager Burt Shotton and teammates (1947)

[1] Born in 1896, Hornsby was a player, player-manager, or off-field exec in pro baseball from 1915 until shortly before his death during the 1962-63 offseason.  Having notched 2,930 fewer MLB hits than Hornsby — generally regarded as the best right-handed hitter in MLB history — I’m hardly one to critique anything he did or didn’t do.  That said, Hornsby might have enjoyed offseasons more if he’d permitted himself to read or watch movies.  He refused to do either during his 23 seasons as an active player (1915 – 1937), convinced that doing so would harm his eyesight.  FWIW, Hornsby didn’t smoke or drink either.  He did gamble, however, compulsively and lucklessly enough (on horse races) to necessitate his working for pay during the entirety of his 25 years as an ex-big leaguer.

[2] Hope springs eternal in Sandi, however, especially for Padres fans with multi-year time horizons: taking a page from the team that won the most recent World Series using a strategy discussed at length below, the Padres have built what is widely viewed as the top farm system in pro baseball as the 2019 season approaches.  If the immediate past serves as reliable prologue to the future — a concededly shaky premise in baseball no less than investing, as also discussed below — the Padres will be world champs within a half-decade, that being the approximate interval between the Red Sox’s zenith in annual talent rankings of MLB farm systems earlier this decade and the team’s most recent World Series win (in 2018). 

[3] Readers seeking more info on Volcker’s role in Nixon’s abandonment of the gold standard in 1971 could do worse than start with the brief history of this decision published by an organization that, like this author, thinks Volcker subsequently did a superb job as Fed chair.  The Hoover Institution’s brief piece on the topic is available here

[4] I’m also planning to write about a pro whose guts and smarts would’ve made him a Hall of Famer if certain team owners hadn’t been so short-sighted and selfish: Fay Vincent, Commissioner of Baseball for a depressingly brief three years ending in September 1992.

[5] Lowenfish’s Branch Rickey: Baseball’s Ferocious Gentleman (2007) remains the best of the multiple Rickey biographies published to date IMO.  No full length biography of Swensen has yet appeared, but much has been written about David’s distinctive personality and methods, including the prior note in this series; a 2017 talk given by this writer (available upon request via dsalem@epsilontheory.com); and, most importantly and authoritatively, in Swensen’s pathbreaking book on institutional funds management and annual reports published by Swensen’s office  available here.

[6] Of the many books about the impact of computer-based analytics on pro baseball, the one I’ve found most illuminating is Travis Sawchik’s Big Data Baseball: Math, Miracles, and the End of a 20-Year Losing Streak, published initially in 2015.  With help from another brilliant baseball wonk (Ben Lindbergh), Sawchik has completed a second book on the steadily rising level of play in pro baseball (off and on the field) that’ll be released in June 2019 — The MVP Machine: How Baseball’s New Nonconformists Are Using Data to Build Better Players.  Perhaps because I’m more intimately familiar with the use and abuse of data science in finance than in baseball, I haven’t identified any books on quantitative methods for investing that I deem must-reads.  If I had to point ET faithful to a single such book while also honoring the principle that it’s better to teach hungry folks to fish than to hand them fishes, it’d be Benoit Mandelbrot’s 2006 classic The Misbehavior of Markets: A Fractal View of Financial TurbulenceFWIW, I try to read every word written by my friend and quant jock extraordinaire Mark Kritzman; a compilation of Mark’s remarkably voluminous writings is available here.

[7] Revenue-sharing protocols generally enable MLB franchises with aggregate big league payrolls beneath the threshold for MLB’s “luxury tax” ($206 million for 2019) to operate in the black even if their big league teams post losing records and miss the playoffs year after year.  How long this not unhappy condition for many team owners (MLB’s equivalent of closet indexing by active money managers?!) can or will last is an open question to be explored in future notes.  As will be seen, tensions between team owners on the one hand and an arguably overmatched players union on the other are mounting in a manner redolent of the widening gyre in American politics on which Ben Hunt has shed useful light in Things Fall Apart.  Whether America’s next national elections on November 3, 2020 will produce a day of reckoning for certain politicians or political views remains unclear.  But it’s virtually certain that a day of reckoning — and perhaps the first work stoppage in MLB since 1995 — will be upon us by this time in 2022, given the 2021 expiry of MLB’s current and increasingly outmoded Collective Bargaining Agreement (CBA).       

[8] This seemingly odd handle for the use of quantitative tools in baseball analytics derives from the leading association of such tools’ users: the Society of American Baseball Research (SABR), founded in — where else? — Cooperstown, NY in 1971.

[9] Over Yale’s six fiscal years ending June 30, 2003 — an interval embodying a wild ride for investors as a group — Yale’s endowment outperformed a 60/40 stock/bond mix by an eye-popping annualized margin of 12.3%: 14.3% per annum for Swensen’s bulldogs vs. 2.0% per annum for puritans maintaining a 60/40 mix of the S&P 500 and a broad US bond index (BBAgg).  Crucially for institutions pondering during the early Aughts whether they wanted to “be like Yale,” Swensen trounced the 60/40 bogey during both bull and bear markets for stocks: 23.1% vs. 6.1% annualized returns in the three years ending June 30, 2000 followed by 7.0% vs. -2.7% annualized in the three years ending June 30, 2003.

[10] Sports fans who deem football superior to baseball due to football’s seemingly zippier pace should note that the average NFL game takes roughly the same amount of time to play as the average MLB game (a tad over three hours) but with roughly one-third less ball-in-play time on average in the NFL than in MLB (12 vs. 18 minutes/game).

[11] MLB will surely and rightly stage similar events in 2034 marking the centennial of the birth of the greatest Latino player in MLB history: Roberto Clemente (1934 – 1972).  A fun and well-researched account of how the Rickey-led Pirates “stole” Clemente from the Dodgers during the 1954-55 MLB offseason is available here.

[12] Though He Who Must Be Not Named can plausibly lay claim to having made the worst error in MLB history (in Game 6 of the 1986 World Series), Fred Snodgrass of the then-New York Giants is viewed by most baseball historians as having committed the worst such gaffe: a dropped fly ball in the final game of the 1912 Series — won ultimately by the team that lost the Series in ’86!

[13] Unlike publicly supported .orgs and .edus that engage routinely in fundraising and are generally free to adopt whatever endowment spending rates (and corresponding return goals) they wish, private grantmaking foundations are subject to minimum payout requirements dictated by Congress. These strictures cause such foundations to  distribute mandatorily an average of about 5% of their wealth each year.

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