Getty Trust to Slash Budget as Investments Tumble
In a separate interview, James Williams, the Getty's chief investment officer since 2002, said there was no plan to change the investment strategy the trust has pursued since the middle of this decade, betting heavily on "alternative investments" such as hedge funds, private partnerships, raw materials and "distressed" companies trying to emerge from Chapter 11 reorganization. Williams said the Getty's approach, which de-emphasizes holdings in publicly traded stocks and bonds, was safer because it allows greater investment diversity.
The strategy is known as the endowment model or the Yale model, in deference to the university that pioneered it in the 1980s, reaping huge returns and begetting many imitators among universities and other nonprofit institutions that could afford to invest huge sums over a long term.
Williams said that over the last year and a half, the Getty had tried to minimize what he considered the approach's two pitfalls: investing in ventures that are loaded with debt and tying up too much money in assets that are hard to sell quickly.
The human factor in this unhappy numbers game is apparent at www.silencedogetty.blogspot.com, where nervous and sometimes angry Getty staffers have been venting anonymously since Feb. 21. "The frustration and fear was palpable" after a round of layoffs last spring, the blog's pseudonymous founder wrote then, and had intensified since December, when Wood issued his memo that further cuts were coming. Wood said Friday that the layoff of 47 workers then, plus the elimination of 77 vacant positions, wasn't done to save money but to "reallocate" resources after a yearlong examination of the trust's priorities.
Staffing now stands at 1,395 full-time and 101 part-time positions.
Wood said he empathized with the anxieties evident on the blog. "I'm anxious myself, to some degree, although we're on the right path, hard as it is." He said he was bothered by the blog's "innuendo that people don't dare ask questions or they would suffer for that. That is not the operation we run."
