The bad news: STRS assets are now down $46.4 billion; a drop of 42%. (We were in shock when it stood at $30 billion!) The good news? There isn't any.

From Dennis Leone, March 14, 2009
Subject: RE: Investment Balance Feb.28th

Yes. Here it is: As of February 27, 2009, STRS total assets stood at $46.4 billion – which represents a total drop of 42% of when STRS peaked at $80.1 billion on October 31, 2007 (which was just 16 months ago).

For the first 8 months of the current fiscal year 2009, our stock market returns have been -32.1%. Add a -5.4% return for the previous fiscal year, and you will come up with a -37.5% for the past 20 months. How can anyone EVER get a bonus check when we have lost 42% of everything we have in the past 16 months and when our investment returns have been -37.5% for the past 20 months?

Oh, but they beat the so-called Wall Street market “benchmark,” or so I am told, which I guess means that I am supposed to be happy. I'm not. We shouldn't just suspend bonuses, freeze wages, and hold the line on hirings, we should be reducing salaries and cutting staff. Future bonuses should never be considered until our asset total returns to at least where we were at the beginning of the current fiscal year – which was $70.1 billion

What do private companies do that lose 42% of their value in 16 months? What do school districts do? We all know the answer to those questions. It’s called LAYOFFS.

I wonder if there is a single STRS investment staff member who has received an unsatisfactory evaluation recently? Don’t blame them, I am told by staff and board members, because it is the market’s fault. But please blame them, and please praise them, and please give them huge bonus checks when our stock market returns go up 20%, like they did 2 years ago. Heaven forbid if I suggested that the “market” caused everyone’s stock market portfolio to go up 2 years ago.

Dennis Leone

From John Bos, March 14, 2009 2:41 PM
Subject: Investment Balance Feb.28th

Does anyone know the STRS Investment Balance for the end of February?

JBos