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Wednesday, December 15, 2010

Masters of the Universe, Salem Division

We're in a "death spiral," but we can still hand out nearly a million in bonuses to state employees who are overseeing the state's losing investments. $258,000 a year isn't enough -- they need a bonus on top of that or they'll move on. Come on, Ted Wheeler, do something.

Comments (7)

Just want to chime in again with the suggestion that these jobs not have their salaries reduced but rather that they be abolished entirely.

Any honest investment pro will tell you what a boatload of research conducted over decades shows: NOBODY knows how to beat market averages reliably, and paying for someone to do so makes you a chump. The only thing we need in an investment manager is the ability to put funds into a broad market index and keep costs low (the Vanguard strategy).

Spot on George!

I can name several outfits that would be good stewards of that money at a fraction of the cost. They would not be funding leveraged buyouts that eat up jobs. What a ripoff.

It's almost like they are holding their jobs hostage.*

"Pay me more or I quit!"
The only proper response to that should be a smile, handshake and a escort to the door.

* someone had to

Talk about tone-deafness. With the state in a "death spiral" and other public employees losing their jobs, forced to take furloughs, or having their hours cut, these wanna-be Wall Street sharks are still demanding their full slurps from the public trough. It's particularly galling since any investment profits their bonuses are supposedly based on are thanks in large part to taxpayers bailing out the economy the last couple of years.
I'm disappointed that Ted Wheeler is not going to rescind these bonuses. Ted, we hardly knew ye.

I agree with George that a passive investment strategy is best, since nobody beats the market in the long run. We have to keep in mind, though, that the state is handcuffed to 8% returns for Tier 1 employees. They have to goose returns by getting in bed with KKR and other barbarians to meet that mandate. Unless that mandate is removed -- extremely unlikely given recent court rulings and union resistance -- these and other shady dealings are guaranteed to continue.

Similar story, different galaxy.

"County commissioners’ salaries, car allowances to go up".


Lc Scott, I say the same thing about executive retention bonuses for dying companies. "But...but if we don't offer multimillion-dollar bonuses, those execs will leave the company!" Considering that the highest compensated individuals at these companies and the ones who caused their collapse can usually be hit with the same bullet, I'm in favor of the same treatment in the private and public sector: giving them a ten-second head start before getting out the bullwhips.

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