Scene Last Night: ETFs, Frida Kahlo Talk of Garden PartyAmanda Gordon
Charles Johnson, who gave $250 million to Yale in 2013, praised the recent gifts of John Paulson ($400 million to Harvard) and Steve Schwarzman ($150 million to Yale).
“Philanthropy is good,” Johnson said cheerfully Thursday night at the New York Botanical Garden’s Conservatory Ball.
For the moment, the former chief executive officer and chairman of Franklin Resources is still the giver of Yale’s largest donation.
What Johnson doesn’t have is the promise of a building with his name on it, even though his gift is helping to build two new residential colleges that will enable Yale College to increase class size by 200 students. Naming the facilities is up to Yale’s governing board. University administrators have said living donors are ineligible.
Asked about having a residential college named after him, Johnson, who turned 82 in January, said, “No comment.” He was slightly more talkative about the ball: “It’s fun. You can wander around the garden. It’s a very relaxed atmosphere.”
Before sitting down for dinner next to his sister Bonnie Sacerdote, Johnson fielded two more questions. On the subject of ETFs versus active investment managers, he said he had “no pearls of wisdom.”
And would he be dancing later? (to music by Soulsystem Orchestras, led by a former drummer of Skid Row.)
“I have a bad foot and a bad hip, so probably not. If I do go, it will be very briefly with my wife.”
Across the dance floor, Jeff Peek said he’s interested in ETFs at WisdomTree that hedge out currency risk. He also said he’s joining Bank of America as of July 6.
One table over was Chuck Royce, a pioneer of small-cap investing. “Passive is in a bubble,” Royce said. “We are returning as we speak to risk management being the predominant way” to invest.
As Royce took his wife, Deborah, to the dance floor, Alexandra Lebenthal and Martin Shafiroff sat together for the meal featuring a shrimp ceviche, herb-roasted chicken and Spanish almond tart with tequila whipped cream: the event’s menu, decor and women’s fashion all nodded to Frida Kahlo, whose interest in plants is the subject of the Botanical Garden’s current exhibition.
Shafiroff, who picks managers for individual and institutional investors at Barclays Capital, said he’s steering money to private-equity firms. “I’m mostly interested in partnerships that build companies,” he said.
Lebenthal, who runs a wealth-advisory firm, came down on the side of managers. “You want someone you can talk to about managing your money,” said Lebenthal, adding she’s concerned about “the whole liquid alts world of ETFs. I think it’s going to be a bubble that’s going to blow up and everybody’s going to say, ‘Oh, we should have seen that.’ And my dress is by Carolina Herrera.”
Herrera herself was under the tent set up behind the Enid A. Haupt Conservatory, sitting with actress Emmy Rossum. The designer’s brand was a ball sponsor, and provided bottles of men’s and women’s perfume as parting gifts.
The evening started in the Perennial Garden in front of the conservatory, where Ali Wambold enjoyed a cocktail. “Imagine a world where all investors only invested in ETFs,” the managing principal of Corporate Partners said. “What would determine stock prices? So you will always have active managers, and as the market shifts toward passive management, the bigger the opportunity for active management.”
Guests arrived to a receiving line manned by Gregory Long, the CEO and president of the garden, Maureen Chilton, its chairman, and the party chairwomen including Ann Johnson, Deborah Royce and Gillian Miniter.
Near a mariachi-style band, Chilton’s husband, Richard Chilton, chatted with a horticulturalist at the garden and Jennifer Foster, an equity specialist at his firm.
Chilton said leaving long-short equity hedge funds for ETFs is the wrong move. It’s like “selling your umbrellas because there’s been sunshine for six years,” Chilton said. “What, we’re never going to have rain again?”
Thankfully, no rain came down on the party, which raised $1.6 million.