• Update: JP Morgan Pulls Back, Bear Stearns Gets Some Good News
• Update: Bear Stearns Tells Investors Subprime Hedge Funds are 'Almost Worthless'
• It's Official: Bear Sees Troubled Subprime Hedge Fund Implode, Other Likely to Follow
• Bear Stearns Allegedly Offers $3.2 Billion to Avert Fire Sale
• Subprime Bond Market 'House of Cards' Set to Fall

The Wall Street Journal ran an interesting story this morning that manages to cover some additional details on the Bear Stearns debacle, while also bringing attention to the newest player in the subprime mortgage bond market — colleges.

First, the details on Bear Stearns' two troubled funds, focusing in on Merrill's auction of fund assets:

Most of the trades Merrill made were at prices of 85 to 95 cents on the dollar. A person familiar with the auction said some bids — which didn't result in trades — were as low as 30 cents on the dollar.

Yesterday afternoon, other lenders to the Bear funds put a further $800 million of the Bear funds' assets up for auction, according to investors who reviewed the lists of assets. Those moves prompted speculation that talks had broken down that were aimed at finding a solution short of auctioning the assets.

Looks like my thoughts last night were correct — AAA and AA securities are getting roughly 90 cents on the dollar, while anything below that is essentially being bid at junk.

Now, to subprime's newest would-be players. The Journal story reported that university endowments "can tolerate more short-term volatility and face less-frequent scrutiny than most public pension funds."

The case of Bill Spitz, who runs Vanderbilt's endowment, is a good example:

Bill Spitz, chief investment officer for the $3.4 billion endowment at Vanderbilt University in Nashville, Tenn., says … he has earmarked $50 million to invest in [subprime mortgage] securities through a new fund from Trust Company of the West …

Mr. Spitz says he has no expertise in the mortgage market, but is placing money with TCW as part of Vanderbilt's strategy of putting as much as 5% of the fund's assets into "opportunistic" investments they hope can boost returns.