This is your daily pension announcement: Well, more frequent because of recent events. Read this article. Why was this only published in the East.... hmm chain newspaper... #handsoffmypension #jasoncausedarecession #noireallymeanit
Jack Mintz is a smart person and a decorated academic. I have heard him speak several times mostly about CPP enhancement and I met him once. I don't always agree with him, but I do agree that he is intellectual honest.
So Jack writes this article about how the JK proposed Alberta Pension Plan upon CPP pullout would be a great idea. Except in doing so he provides all the evidence against putting ATRF assets with AIMCo. #suckandblow #ABTeachers
For example: "Some argue that Alberta could use the funds to backstop Alberta businesses similar to the role of the Caisse de dépôt et placement du Québec. However, this is not something to emulate with some investments in sub-profitable companies in prior years." #notwithmymoney
This is, of course, the primary worry of teachers. That money held in trust for them will be used to backstop failing Alberta businesses that can't compete. Straight from Jack: do not do this. Do not emulate. Poor investments are poor investments. Concern is warranted.#treasury
Next Jack says: "Although pension fund managers hope to earn better returns with private equity than market-based securities, such investments result in higher administrative costs." Yeah that is right ATRF has higher investment admin costs because of private equity assets.
In fact, the six year annualized return (to Dec 31, 2018) for ATRF private equity is 20.7% substantially higher than public market investments (AIMCo for the same period returned a paltry 7.8% in private equity). As Jack tells us the rule, we should shout out hallelujah!
Next Jack says: "Overall, economic studies are not conclusive with some suggesting that size results in lower costs per dollar of assets but only for small- and medium-size pension plans." Let that sink in. Big not necessarily better.
Travis Toews' claim that big plans automatically have lower costs is entirely incorrect. I have said from the start of this brouhaha that this move deserves careful study. That study has not been done.
Next Jack says: "Besides, being larger does not necessarily lead to better performance since it is harder to find large investment opportunities." I HAVE BEEN SCREAMING THIS! WHY IS NO ONE LISTENING? Moving ATRF assets to a larger organization will likely reduce investment return
There you have it straight from the renown public policy expert often quoted by the UCP. I am shocked the CFA's at finance have allowed Travis (and his MLAs) to say the things he has. It stands up to no academic scrutiny. None. #talkoutofyourmouthandassatthesametime
Teachers need to fear GOA interference in investments with AIMCo backing failing Alberta business (Gainers anybody?). Teachers also need to fear a lower investment return with a large manager like AIMCo. Lastly, teachers need to fear the lies that are being foisted upon them.
