Dennis Leone: Some words for today's STRS Board

From Dennis Leone

December 2, 2020 

The Board has a potential huge PR problem with this F-rating, coupled with gigantic bonus checks for the investment staff (many of which were based on benchmarks staff members set for themselves). You saw recently, as everyone did, that the DOW got over 30,000 last week. I wish to point out to the Board, firmly, that I was on the Board in 2008 when things suddenly went downhill in the stock market.

Here is my point: Just before that happened, the DOW hit 14,000 and our total assets at STRS were OVER $80 billion. The news media has reported recently that our total assets at STRS are NOW back up to $80 billion. It took STRS 12 years to get our assets to climb back up to our previous high of $80 billion, even though the DOW more than doubled in value during those 12 years.

This is an incredible embarrassment. The Board should be demanding better performance from the investment staff instead of giving them gigantic bonus checks. A solid argument could be made that NO bonus checks should have gone out during those 12 years when our total assets were not back to what there were in 2008. All of those dollars given in bonus checks over the 12 years should have been divided among all retirees, especially since our COLA was eliminated.

Dennis Leone

STRS Board member 2005-2009