Yale University Investment Chief David Swensen says that despite a 25% loss in the school's endowment amid the economic turmoil, he has no plans to change his investing strategy.

“We really haven't changed much at all, he told FOX Business anchor Liz Claman. “I think one of the most important things that investors can do is stick with a tried-and-tested strategy. We are reestablishing our policy targets through rebalancing and sticking with what we think will work in the long run.

While many schools, including elite private colleges, are curbing construction and new developments to help deal with a drop in funds, Swensen said he’s not making any jerky actions.

"You should try and tune out the news. When people react to what they see in the newspapers or on TV, they're liable to end up behaving perversely.

In the last few months Yale’s endowment has taken a significant hit. In June the fund dropped to around $23 billion with about $17 billion sitting in the fund now.

In mid-December, Yale’s president warned the endowment’s drop in value could leave a $100 million hole in the school’s 2009 budget. The endowment supports 44% of the school's $2.7 billion annual budget.

Swensen also sharply criticized the government’s handling of the financial meltdown, saying regulators took steps that exacerbated the problem and were too inconsistent.  

"You almost have to be trying to do things in an incoherent, inconsistent way to have ended with a huge range of ways they have come up with to address these problems."

Economic recovery can only take place once the credit markets are fixed, he said.

"The only way to fix the credit markets is to reestablish flows of private capital, and the government in too many instances has substituted the government’s balance sheet for flows of private capital."

While Swensen agreed with the idea of TARP in principal, he said it lacked a stable, consistent execution.

“What I would argued for would have been a very consistent, very transparent approach where the government would say what we are going to do in every instance. We are going to do what Warren Buffett did with Goldman Sachs (GS), put in preferred stock -- and we are going to do in on terms that are predictable and consistent and then private capital flows would be attracted to the financial institutions."

Swensen has been managing Yale’s endowment since 1985 when it was at just $1 billion.