Although I hesitate to engage in a debate between correspondents to your Letters to the Editor, a desire to ensure accuracy compelled me to write.
In your July 27 edition, you published a letter by James McRitchie. Mr. McRitchie did not identify himself as a candidate for an elected seat on the board of California Public Employees' Retirement System. Thus, when Mr. McRitchie criticized the actions of CalPERS Board President William Crist, your readers were not given the important information that Mr. McRitchie is opposing Dr. Crist in a pending election.
Quite frankly, P&I was used to promote the campaign platform of a single candidate. This concerns me because, unlike the campaign materials that CalPERS distributes to its members/voters, not all candidates had an equal opportunity to comment, nor was there any requirement for truthfulness.
I am also concerned because Mr. McRitchie states unequivocally in his letter that CalPERS adopted its recent ethics reform policies contrary to a "legally required rulemaking process" and that the court will "likely throw out the rules."
Again, the search for accuracy forces me to point out that Mr. McRitchie is not an attorney, is not licensed to practice law in California, and has raised these issues in the context of his campaign.
CalPERS Board stands firmly behind the legality and validity of its policies, and the sound judgment that those policies represent.
James E. Burton
Chief Executive Officer
California Public Employees'Retirement System
PBGC's DB promotion
I found your July 27 articles on efforts of the Pension Benefit Guaranty Corp. to promote defined benefit plans very interesting ("Pension plans face a facelift," page 2 and "PBGC divulges DB plan details," page 8).
Since the PBGC's revenue comes from premiums charged to sponsors of defined benefit plans, it comes as no surprise that they are marketing these plans heavily, and that they report with dismay the decline of defined benefit plans.
But the PBGC is a government regulatory agency, not a private enterprise in business for itself.
If Corporate America decides that 401(k) plans are the future retirement plans of choice, then the PBGC should step back and let it happen. In fact, the shift to defined contribution plans should relieve the PBGC of future unfunded liabilities. The federal government should be pleased with this development.
There are good reasons to support defined benefit plans, but this support should come from employees, employers, and pension professionals, not from the PBGC.
Raymond J. Murphy
Benefits Planning and Analysis Manager
Hershey Foods Corp.
Global manager missing
The Common Fund was not included in the lists of managers in surveys in the July 13 and July 27 issues of Pensions & Investments.
It was missing from the July 13 Special Report on International/Global Managers. As of March 31, The Common Fund managed $2.36 billion in international/global assets. Although we would not have made the top 50, The Common Fund would have come in at number 65. We never received the survey.
It was also missing from the July 27 Special Report on the Largest Managers. As of Dec. 31, The Common Fund managed over $19.1 billion. The Common Fund would have ranked number 245.
As many may know, The Common Fund is a nonprofit membership corporation devoted exclusively to enhancing the financial resources of educational institutions through superior fund management and investment advice. We employ a multimanager, multistrategy approach.
Kwok J. Eng
Director-Member Services Research
The Common Fund
Manager left out
Your May 18 issue contained a special section on money managers that did not include Investment Counselors of Maryland.
Please note that, at year-end 1997, we had $4.443 billion under management with tax-exempt assets of $3.897 billion.
Elizabeth A. Dannettel
Assistant vice president
Investment Counselors of Maryland
One of Top 500
In your July 27 issue you listed the top 500 managers in your P&I/Watson Wyatt World 500 listings. Inadvertently, Value Asset Management was not listed.
Value Asset Management was formed in 1996 for the express purpose of purchasing majority interests in high quality investment managers. Today VAM has more than $8 billion in assets with its affiliates. These assets reside in three firms: Dalton Greiner (small-cap value), Harris, Bretall (large-cap growth) and Grosvenor Capital Management (hedge fund of funds).
Our philosophy is to purchase a select group of non-competing managers and allow them to operate autonomously around a common distribution and service platform. We believe this to be the way for these entities to enjoy optimal growth.
We respectfully ask that Value Asset Management be included on any reprint lists you may issue.
Leighton W. Strader
Executive Vice President
Value Asset Management Inc.
Despite our submissions, we were disappointed that your June 15 Pensions & Investments' Performance Evaluation Report, as well as your July 13 addenda did not include our performance figures for the quarter, year and three years, ended March 31, 1998.
For all three periods our MultiCap Equity Composite is well into the first quartile, as the accompanying table shows.
Derwood S. Chase Jr.
President and Chief Investment Officer
Chase Investment Counsel Corp.
Chase Investment Counsel Corp.
Balanced Multicap Midcap
quarter 9.45 14.92 13.32
1-year 32.80 57.62 50.17
3-year 22.68 34.61 31.62
Dec '97 196 357 75