Monthly Archives: July 2013

Top 10 Landowners in HBCU States


Editors’ Note: There are no African Americans among the top 100 landowners’ in America according to The Land Report 100. If Special Order 15 had been honored African America would have controlled 160 million acres post Civil War or 7 percent of America’s land. Today, African America controls a mere 0.0033 percent of America’s 2.3 billion acres or just under 8 million acres. Most of the top ten landowners have property in other states but our list includes those with large holdings in at least one designated HBCU state. The top ten landowners in HBCU states control 10.2 million acres or approximately 28 percent more land than all of African America. HBCU land-grant institutions could play a large role in the education of African America to the importance of land ownership.

1) Ted Turner (Georgia) – 2 000 000 Acres

2) Emmerson Family (California) – 1 840 000 Acres

3) Brad Kelley (Kentucky) – 1 500 000 Acres

4) King Ranch Heirs (Texas) – 911 215 Acres

5) Pingree Heirs (Massachusetts) – 830 000 Acres

6) Reed Family (California) – 770 000 Acres

7) Ford Family (California) – 625 000 Acres

8) Lykes Brothers Heirs (Texas & Florida) – 615 000 Acres

9) Briscoe Family (Texas) – 560 000 Acres

10) W.T. Waggoner Estate (Texas) – 535 000 Acres

Source: The Land Report

HBCU Money™ B-School: What Is Risk?

By & Securities Exchange Commission



All investments involve some degree of risk. In finance, risk refers to the degree of uncertainty and/or potential financial loss inherent in an investment decision.  In general, as investment risks rise, investors seek higher returns to compensate themselves for taking such risks.

Every saving and investment product has different risks and returns.  Differences include: how readily investors can get their money when they need it, how fast their money will grow, and how safe their money will be. In this section, we are going to talk about a number of risks investors face.  They include:

Business Risk

With a stock, you are purchasing a piece of ownership in a company.  With a bond, you are loaning money to a company.  Returns from both of these investments require that that the company stays in business. If a company goes bankrupt and its assets are liquidated, common stockholders are the last in line to share in the proceeds.  If there are assets, the company’s bondholders will be paid first, then holders of preferred stock.  If you are a common stockholder, you get whatever is left, which may be nothing.

If you are purchasing an annuity make sure you consider the financial strength of the insurance company issuing the annuity.  You want to be sure that the company will still be around, and financially sound, during your payout phase.

Volatility Risk

Even when companies aren’t in danger of failing, their stock price may fluctuate up or down.  Large company stocks as a group, for example, have lost money on average about one out of every three years.  Market fluctuations can be unnerving to some investors.  A stock’s price can be affected by factors inside the company, such as a faulty product, or by events the company has no control over, such as political or market events.

Inflation Risk

Inflation is a general upward movement of prices.  Inflation reduces purchasing power, which is a risk for investors receiving a fixed rate of interest.  The principal concern for individuals investing in cash equivalents is that inflation will erode returns.

Interest Rate Risk

Interest rate changes can affect a bond’s value.  If bonds are held to maturity the investor will receive the face value, plus interest.  If sold before maturity, the bond may be worth more or less than the face value.  Rising interest rates will make newly issued bonds more appealing to investors because the newer bonds will have a higher rate of interest than older ones.  To sell an older bond with a lower interest rate, you might have to sell it at a discount.

Liquidity Risk

This refers to the risk that investors won’t find a market for their securities, potentially preventing them from buying or selling when they want. This can be the case with the more complicated investment products.  It may also be the case with products that charge a penalty for early withdrawal or liquidation such as a certificate of deposit (CD).

Accumulation Risk

Not investing may result in insufficient funds to accomplish life’s goals.  For most people, the only way to attain financial security is to save and invest over a long period of time.  You need to have your money work for you.

Are there any Guarantees?

The Federal Deposit Insurance Corporation (FDIC) – Savings accounts, insured money market accounts, and certificates of deposit (CDs) are generally viewed as safe because they are federally insured by FDIC.  This independent agency of the federal government insures your money up to $250,000 per insured bank.  It is important to note that the total is per depositor not per account.  But there’s a tradeoff between security and availability; your money earns a low interest rate.

The FDIC insures deposits only.  It does not insure securities, mutual funds, or similar types of investments that banks and thrift institutions may offer.

The National Credit Union Administration (NCUA) –The National Credit Union Share Insurance Fund (NCUSIF) is the federal fund created by Congress in 1970 to insure credit union member’s deposits in federally insured credit unions.  The Dodd -Frank Act permanently established NCUA’s standard maximum share insurance amount at $250,000.  NCUSIF is backed by the full faith and credit of the U.S. Government.

Securities Investors Protection Corporation (SIPC) – Securities you own, including mutual funds that are held for your account by a broker, or a bank’s brokerage subsidiary, are not insured against loss in value.  The value of your investments can go up or down depending on the demand for them in the market.  The Securities Investors Protection Corporation (SIPC), a non government entity, replaces missing stocks and other securities in customer accounts held by SIPC member firm up to $500,000, including up to $250,000 in cash, if the firm fails.  For more information see

The HBCU Endowment Feature – Edward Waters College


School Name: Edward Waters College

Median Cost of Attendance: $18 481

Undergraduate Population: 769

Endowment Needed: $284 237 780

Analysis: Edward Waters College needs approximately $284 million for all of its students to attend debt free annually. The college is located in Jacksonville, Florida which has an estimated population of 820 000 with 30 percent of that population being African American which is well above the state’s overall African American population percentage of 16 percent. Jacksonville being located in the northeast part of the state would allow for recruitment opportunities into southeastern Georgia. All factors that are extremely needed for a school where student population has declined by almost 40 percent. This gives Edward Waters College an opportunity to expand its geographic presence. It has legacy on its side as the oldest HBCU in Florida which can be a remarkable marketing point if properly used. They also have prime academic balance between STEM and humanities which can be presented as an opportunity to develop wholistic students and a great selling point. The enrollment desperately needs to reach a population of 3 000  students in order to start to produce enough alumni for a donor pool that can impact the college’s long-term endowment. There should be some consideration to develop a niche graduate program to begin to create a pipeline of high quality donors. Edward Waters College is an HBCU with a lot of potential and promise but demographic headwinds could ultimately make its journey forward very difficult. If it can conquer the challenge of its demographics, then the school is in a prime position to see an explosion in its endowment and secure footing for its future.

As always it should be noted that endowments provide a myriad of subsidies to the university for everything from scholarship, faculty & administration salaries, research, and much more.

HBCU Money™ Business Book Feature – Tower of Basel: The Shadowy History of the Secret Bank that Runs the World


Tower of Basel is the first investigative history of the world’s most secretive global financial institution. Based on extensive archival research in Switzerland, Britain, and the United States, and in-depth interviews with key decision-makers—including Paul Volcker, the former chairman of the US Federal Reserve; Sir Mervyn King, governor of the Bank of England; and former senior Bank for International Settlements managers and officials—Tower of Basel tells the inside story of the Bank for International Settlements (BIS): the central bankers’ own bank.

Created by the governors of the Bank of England and the Reichsbank in 1930, and protected by an international treaty, the BIS and its assets are legally beyond the reach of any government or jurisdiction. The bank is untouchable. Swiss authorities have no jurisdiction over the bank or its premises. The BIS has just 140 customers but made tax-free profits of $1.17 billion in 2011–2012.

Since its creation, the bank has been at the heart of global events but has often gone unnoticed. Under Thomas McKittrick, the bank’s American president from 1940–1946, the BIS was open for business throughout the Second World War. The BIS accepted looted Nazi gold, conducted foreign exchange deals for the Reichsbank, and was used by both the Allies and the Axis powers as a secret contact point to keep the channels of international finance open.

After 1945 the BIS—still behind the scenes—for decades provided the necessary technical and administrative support for the trans-European currency project, from the first attempts to harmonize exchange rates in the late 1940s to the launch of the Euro in 2002. It now stands at the center of efforts to build a new global financial and regulatory architecture, once again proving that it has the power to shape the financial rules of our world. Yet despite its pivotal role in the financial and political history of the last century and during the economic current crisis, the BIS has remained largely unknown—until now.

HBCU Money™ Dozen Links 7/8 – 7/12


Did you miss HBCU Money™ Dozen via Twitter? No worry. We are now putting them on the site for you to visit at your leisure. We have made some changes here at HBCU Money™ Dozen. We are now solely focused on research and central bank articles from the previous week.


Watch the Oregon Sea Grant video, “How to Feed a Giant Pacific Octopus l Oregon Sea Grant

Classroom pets and plants can quickly become invasive too, so be careful with them l IL-IN Sea Grant

Did you know there are approx. 800,000 miles of public sewer lines in the US l EPA Research

Do you know what Vibrio vulnificus is? l Louisiana Sea Grant

Need to model the hydraulic & water quality behavior of water distribution piping systems? l EPA Research

Ever wonder why E=mc^2 is so incredibly famous? “Starts With a Bang!” l SLAC

Federal Reserve, Central Banks, & Financial Departments

Lawmakers propose PATH Act to create housing sustainability l Housing Wire

New home purchase mortgage apps decrease by 15% l Housing Wire

The Crash, Risk and Monetary Policy. A look at 1987 market behavior l Chicago Fed

See today’s import/export data broken down by country and type of product l St. Louis Fed

Teachers: Get resources to inspire your students about entrepreneurship at our workshop 7/19 l Kansas City Fed

Elementary teachers: Register for “Talking Economics, Walking History” on Aug. 7 in Little Rock l St. Louis Fed

Thank you as always for joining us on Saturday for HBCU Money™ Dozen. The 12 most important research and finance articles of the week.