December 8, 2023 • 6 min read |
But first, a problem at Penn. |
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Liz Magill. Kevin Dietsch/Getty Images |
Get out or give it back. That was the message from a Wall Street executive to the University of Pennsylvania president regarding his $100 million donation to the school. Ross Stevens' ultimatum comes after Penn President Elizabeth Magill fumbled through a congressional hearing on antisemitism. Magill, along with Harvard President Claudine Gay and MIT President Sally Kornbluth, skirted questions from Rep. Elise Stefanik over whether calling for the genocide of Jews violated their universities' rules on bullying and harassment. "If the speech turns into conduct, it can be harassment," Magill said. The backlash was swift and fierce. Billionaire hedge fund manager Bill Ackman, a vocal critic of Harvard's response to the Israel-Hamas war, called for all three presidents to "resign in disgrace." And while each president issued a statement after the criticism, there was no going back for Stevens. In a letter to his firm's employees, Stevens, who is a Penn alum, said he planned to pull $100 million of Stone Ridge shares he had previously gifted the school "due to the conduct of President Magill" unless there was "a change in leadership and values at Penn in the very near future." |
Kevin Dietsch/Getty Images |
Stevens' ultimatum is the most significant response to the rising tension between elite universities and Wall Street executives. Plenty of alums have threatened to pause donations over concerns of antisemitism on campus and schools' responses, or lack thereof. Taking money back is a whole other ball game. To be sure, Penn isn't exactly hurting for cash. The school's endowment totals some $21 billion. Losing $100 million, while an incredible sum, won't necessarily make a dent. But the optics of a Penn-grad-turned-finance-exec — the exact type of person Penn presumably pitches incoming students as an ally of the school — forcibly taking money away from it cuts deeper than losing $100 million. The ties between Penn and Wall Street run deep. In the same way the University of Alabama is a breeding ground for NFL players, Penn is for Wall Streeters. And it's not just any Wall Streeters, but pretty successful ones. An analysis by Forbes in 2022 found that UPenn had the most undergraduate alumni on its ranking of the wealthiest Americans with 17 grads, including D1 Capital Partners Daniel Sundheim and Blackstone's Jon Gray. But there will be those who don't like the idea of the uber-wealthy holding so much power over universities, even if they disagree with how the presidents handled the congressional hearing. The reality, though, is that billionaire donors and money managers have long held considerable sway via their relationship with elite universities' endowments. |
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Markets 🔔 Before the opening bell: US stock futures struggle for direction early Friday ahead of the big November nonfarm payrolls report. |
Lindsey Nicholson/Getty Images |
1. Congrats! We're all about to be worse off than we were a few years ago. Only the top 1% of consumers will be in a better place financially than they were before the pandemic by mid-2024, according to JPMorgan. Roughly 80% of consumers have already burned through any savings accumulated during the lockdowns. 2. BlackRock got some (unwanted) attention at the Republican debate. The world's largest money manager and its CEO took plenty of shrapnel, highlighting the GOP's constant criticism of the firm. Larry Fink responded by going on the offensive, pointing out that some candidates spread misinformation. 3. Spotify's layoffs demonstrate how the debt market can blow up a company's balance sheet. CEO Daniel Ek cited higher debt-refinancing costs when explaining why the company cut 17% of its staff. Those issues could crop up for other companies as the impact of the Fed's interest-rate hikes are felt across corporate America. |
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Michael M. Santiago/Getty, MarkHatfield/Getty, Tyler Le/BI |
1. Neighbors reveal what it's like to live next to Jeff Bezos. Bezos bought four properties in and around an exclusive Seattle-area enclave in 2019. "He acts like he owns" the neighborhood, one resident said. 2. The debate splitting Silicon Valley: e/acc or decel? E/accs believe that the forces of technology, innovation, and capitalism should be harnessed to drive rapid social change. Meanwhile, decels believe that resources should be allocated toward helping as many as possible. 3. People are hyped for Google's AI model. Gemini was released as Google's answer to OpenAI's GPT-4 (the AI model that powers ChatGPT). One day in, it's already sparking excitement among developers. And Google confirmed that its cofounder Sergey Brin played a key role in its creation. |
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Jennifer Ortakales Dawkins/Insider |
1. Amazon just gave the clearest sign yet it's nervous about Shein. The e-commerce giant announced that it'll reduce seller fees on clothing under $20. This change comes as Shein gains market share and recently filed to go public. 2. Meet the Apple execs charged with picking hit shows. Business Insider identified the executives making programming decisions for Apple TV+'s scripted series. Their roster includes alums from companies like Sony Pictures TV, Paramount Network, and A+E Studios. 3. Elon Musk goes off on Disney CEO Bob Iger, saying he should be "fired immediately." Musk posted on his platform X that Walt Disney was "turning in his grave over what Bob has done to his company." |
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- Calling all Barbz: Nicki Minaj is dropping a new album. It's called "Pink Friday 2," as a nod to her debut album "Pink Friday."
- Today also happens to be Nicki Minaj's birthday. Jim Morrison, Mary Queen of Scots, Amir Khan, and Sinead O'Connor were also born on this day.
- Happy National Brownie Day. It's meant to celebrate the dessert, which was invented near the end of the 19th century.
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