Obama’s chief economic advisor apparently went all in on Harward’s endowment fund against all advice…resulting in major losses:

Mohamed El-Erian, would later sound the same warnings to Summers, and to Harvard financial staff and board members.

“Mohamed was having a heart attack,’’ said one former financial executive, who spoke on the condition of anonymity for fear of angering Harvard and Summers. He considered the cash investment a “doubling up’’ of the university’s investment risk.

But the warnings fell on deaf ears, under Summers’s regime and beyond. And when the market crashed in the fall of 2008, Harvard would pay dearly, as $1.8 billion in cash simply vanished. Indeed, it is still paying, in the form of tighter budgets, deferred expansion plans, and big interest payments on bonds issued to cover the losses.

Combined with the “dream team” of Geithner and Bernanke this is not exactly confidence inspiring. But it explains a lot in terms of recent policy.

They doubled down on debt in order to jump start the economy. It’s a gamble by an economic advisor who has a track record of gambling with other peoples’ money and losing…..