Rudy Fichtenbaum: One must wonder why the staff are so invested in influencing the current Board elections

 My Previous Post on Mr. Neville’s Presentation

By

Dr. Rudy Fichtenbaum

April 27, 2022

In my last Post, I asserted that the index returns for the S & P 500 and the Russell 3000, as reported by Mr. Neville in his surprise presentation at the April 21st Board Meeting, did not include dividends. I was mistaken, and for that I apologize. However, I would not have accused Mr. Neville and Mr. Worley of using indices that did not include dividends, had I been given the data I requested in a timely manner. Additionally, I would not have been so quick to post my analysis without seeing the data had I not been concerned about the timing of Mr. Neville’s presentation.

My efforts to obtain the data used in Mr. Neville’s presentation included: 1) I asked for a copy of the data, upon which Mr. Neville’s graphs were based, immediately after his presentation; 2) I had to repeat my request for this data to Mr. Worley at the end of the Board meeting because he failed to list providing the data to me and Mr. Steen on the “list of things to do”; 3) I still had not received the data forty-eight hours later. In the past, previous requests for data or other information had also been met with delays.

Additionally, I questioned why Mr. Neville’s presentation was given when it was not on the agenda, and only appeared in Board packets at 7:59 AM on the morning of the meeting. It appeared to me that the surprise presentation by Mr. Neville was strategically connected to the Board elections. The timing of Mr. Neville’s presentation enabled the Staff to include a statement in the STRS April 22nd eUpdate (released the day after the Board meeting) that STRS’s active investing has historically beaten index investing. This timing was important because Mr. Neville was well aware that, in the eyes of many active and retired members, a key election issue is active investing (and the bonuses paid to Staff) v index investing. His presentation appears to be a continuation of Staff trying to influence Board elections. Recently, a number STRS email communications selectively corrected supposedly erroneous statements made by, or on behalf of, candidates endorsed by ORTA, the STRS Watchdogs, OFT, and Ohio AAUP, but failed to similarly address misstatements by incumbent candidates. One must wonder why the staff are so invested in influencing the current Board elections.

I still believe that STRS would benefit from index investing, a topic which I will address in future posts.

Dr. Rudy Fichtenbaum is Professor Emeritus of Economics at Wright State University and an elected member of the STRS Board since September 1, 2021.