Equities analysts said the decline of theendowment is not unexpected.
"It's not due to Harvard's strategy," said JohnSchmitz, director of equity strategy for FifthThird Investment Advisors. "What we are in is ahighly volatile time in the market."
Other schools have experienced similar fiscaldownturns.
Princeton's endowment--$5.6 billion at the endof fiscal year '98--fell 7 percent in August buthas since rebounded to enable the university tobreak even for the year, said Justin Harmon,Princeton's director of communication.
At the University of California at Berkeley,endowment returns have declined over the past yearfrom returns of 17.5 percent in fiscal year '97 toreturns of 12.8 percent in the last fiscal year.In the last two months things have gotten "evenworse," according to Elizabeth Yung, senioranalyst at the UC Berkeley Foundation, theorganization that manages the school'sinvestments.
Meyer said he hopes Harvard can even profitfrom judicious investment while stock prices arelow. But both Meyer and other investors refuse tospeculate on the future.
"The people in charge of Harvard's endowmentcan't make decisions on what is going to happenover the next three or four months," Schmitz said