Harvard and Yale, whose endowments enjoyed robust growth in the years leading up to the financial crisis, watched their endowments crater in value over the past year. Harvard's tumbled from more than $36 billion to $26 billion, a drop of 27 percent. (When combined with a dip in giving, the total change was about 30 percent.) Yale's plummeted to about $16 billion, down from $23 billion, which was also a 30 percent decrease in value. Both schools said they were adapting to the losses and continuing to cut developments not already funded in earlier years or by current capital campaigns. According to the Times, other schools and foundations with endowments of more than $1 billion have seen an average decline of 17 percent so far this fiscal year.

So, yes, parents of smart kids, for the next few years, you are going to continue to arrive on campus, look at your child's ragged freshman dorm room, and ask yourself, I'm paying $50,000 a year for this? But then again, we can't imagine a time, no matter what improvements, expansions, or construction goes on at these schools, when that won't be what parents are thinking.

Harvard and Yale Report Losses in Endowments [Dealbook/NYT]