State Employees’ Retirement Fund Market Value Altimeter
February 2004
| Valuation Date |
Market Value (in billions) |
| 12/31/03 | $9.369 |
| 11/30/03 | $9.107 |
| 10/31/03 | $9.073 |
| 9/30/2003 | $8.857 |
| 8/31/2003 | $8.851 |
| 7/31/2003 | $8.874 |
| 06/30/2003 | $8.707 |
| 03/31/2003 | $8.181 |
| 12/31/2002 | $8.537 |
| 12/31/2001 | $9.914 |
| 12/31/2000 | $10.890 |
| 12/31/1999 | $11.055 |
| 12/31/1995 | $6.595 |
| 12/31/1990 | $3.935 |
What a rut to be in: Another gain, the 9th straight, by the State Investment Fund portfolio which showed a 262 million increase between November 30th and December 31, 2003. The total market value of the fund as of year ended showed 9.369 billion. We note that inequities in the fund were increased from 56% the first of 2003 to 59.3% the end of December. Fixed income, alternatives and real estate all were reduced at least by 1% during this period. Incidentally, Webster indicates that the word equity means, “the amount of value of a property or properties above the total of liens or charges.”
Observations, Facts and Assumptions
How sad — Because of investment losses caused by a weak economy more than 110,000 retired state employees in the State of Minnesota received pension increases of only 2.1% in December according to the State Board of Investment. Annual increases have averaged 5.6% over the past five years. I repeat, how sad.
I stumbled on to a few quotes concerning performance evaluations and immediately thought of the previous State Administration. “ He sets low personal standards and then consistently fails to achieve them.” “I would not allow this employee to breed.” “Since my last report this employee has reached rock bottom and has started to dig.” “This employee should go far — and the sooner he starts the better.” — and so he went, pensions and all.
If you are a prude don’t read what follows unless your curiosity is overbearing: Since July, 2000, the United States has lost nearly 3 million manufacturing jobs which reflects more than 15% of its factory work force. This problem has especially hit the State of Michigan. Our present Governor is working on stopping the hemorrhage and we trust she will succeed. Most of these jobs have gone overseas or to Mexico because it is cheaper to manufacture certain goods elsewhere. Over the past year in Michigan unemployment increased 17.7% while nationwide it crept up 0.4%. Also, because of the state’s budget crunch, Michigan credit rating has been lowered a notch by Standard and Poors. Unfortunately, we could go on. Now the good news? “ Analysts predict modest market gains in 2004.” Also the success in Iraq. Is this a fairy tale. A resurgent economy — stocks appear to be showing solid gains although analysts believe the value of , stock is a bit high, at least 10%, relative to companies profits. The Jobs and Growth Tax Relief Reconciliation Act of 2003 signed on May 28th was a 350 billion tax cut package engineered by President Bush. This equates to about $16 for each US citizen. I bought a new driver’s license in January and there is where my $16 went. Drivers licenses are now $18. I read some place that life is like a doughnut. You are either in the dough or in a hole.
Now let us get a little positive: Mr. Charles B. Johnson, Chairman of Franklin Templet Investments states, “Today the US economy is measurable healthier and the market has delivered its best gains in several years which has given rise to greater investment optimism. US economic growth accelerated particularly during the summer months of 2003 In fact, real gross domestic product (GDP} a key measure of the nations economic output, surged 8.2% in the third quarter-the largest quarterly increase in nearly two decades.” Now if we only had a little extra cash to invest with Mr. Johnson! Hey — do you suppose we could transfer our state investment savings over to the Minnesota system?
Did You Know
- That 40% of vehicles on the road today are either SUV s or trucks.
- It was 1781 that the first modem bank in the United States, the Bank of North America, opened in Philadelphia.
- The life span of a coin in the US is twenty-five years.
- The first signer of the Declaration of Independence John Hancock, was, born in 1737.
- What determines gas prices?
- Forty three percent-crude oil costs
- Thirty one percent-federal and state laws
- Thirteen percent-distribution and marketing
- Thirteen percent-refining costs and profits
Source: Energy Information Administration
Ponder This
- A nickel isn’t worth a dime anymore. — Yogi Berra
- Rule No. 1: Never lose money. Rule No. 2: Never forget Rule No. 1. — Warren Buffet
- If only God would give me a sign like making a deposit in my name in a Swiss bank account. — Woody Allen (Woody dreams like elderly state retirees).
Editor’s note: Al Trierweiter is a former President of the Lansing SERA Chapter, former Chairman of the Michigan SERA Coordinating Council, former Legislative Representative for both the Lansing Chapter and the SERA Council. AI may be reached at 6440 Old River Trail, Lansing 48917; phone 321-0041.
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